Reddit Stocks: What meme stocks are trending today? – July 7, 2023

US futures

• Dow Jones Industrial Average is down 0.2%
• S&P 500 is down 0.2%
• Nasdaq 100 is up 0.1%

 

US non-farm payrolls

Markets are digesting US non-farm payrolls, which saw fewer jobs added than forecast for the first time in over a year to suggest the labour market, which has remained buoyant despite the challenging economic conditions, is starting to weaken.

NFPs rose 209,000 in June, marking a deceleration from the 306,000 additions we saw the month before. That was below the 225,000 forecast by economists. The unemployment rate dropped back to 3.6% as expected after the surprise rise to 3.7% last month.

Average hourly earnings rose 0.4% from last month, faster than the 0.3% forecast. They were 4.4% higher than the year before, also ahead of the 4.2% estimate.

That is countering the concerns that emerged yesterday when the less accurate ADP report suggested far more jobs would be added than forecast and fuel the need for more interest rate hikes. Although the data will be welcomed, it is not enough alone to suggest there will be any changes to the Fed's plan to keep hiking interest rates. 

 

Most discussed Reddit stocks

Below is a list of the top 10 most mentioned US stocks on the WallStreetBets thread on Reddit over the last 24 hours, according to data from Quiver Quantitative. Exchange-Traded Funds (ETFs) and other instruments have been excluded:

1. Visa
2. Tesla
3. Rivian
4. NVIDIA
5. Meta
6. Apple
7. Microsoft
8. C3.ai
9. Mullen Automotive
10. Advanced Micro Devices

 

Most active US stocks before the bell

Below are the most active stocks with a valuation of at least $500 million before the bell, based on trading data taken from Bloomberg:

1. Rivian
2. Nikola
3. Tesla
4. Carnival
5. SoundHound AI
6. Lucid Group
7. Lilium
8. Palantir
9. Riot Platforms
10. Joby Aviation

 

US premarket winners and losers

Here are the stocks worth at least $500 million experiencing the sharpest movements in premarket trade, according to data from Bloomberg:

Winners	%	Losers	%
The Metals Co (TMC)	9.9%	LifeZone Metals	-9.6%
THG Therapeutics	6.3%	Levi Strauss	-8.2%
Desktop Metal	5.2%	Varonis Systems	-4.8%
AAON	5.0%	Summit Therapeutics	-4.6%
ACV Auctions	4.9%	Cymabay Therapeutics	-4.3%
E2open Parent Holdings	4.9%	PureCycle Technologies	-4.0%
Beam Therapeutics	4.8%	WeWork	-3.6%
Verve Therapeutics	4.4%	Vizio	-3.4%
Bowlero	4.3%	Marqeta	-3.1%
Ispire Technology	4.1%	Livent Corp	-3.1%

 

Top US stocks to watch

Tesla is up 0.4% at $277.50. Mizuho raised its price target on the electric carmaker to $300 from $230 this morning, becoming the latest to become more bullish on the stock. The company is offering a new cash rebate in China of CNY3,500, worth some $484, for customers that are referred by existing owners. That is raising fears that the price war in China is not done, despite 16 companies agreeing to maintain fair practices and avoid abnormal pricing earlier this week. Plus, reports suggest it is laying off some employees working on its battery packs in the country. Media reports suggest fewer than 1,000 staff are working on its two battery pack production lines but it is not clear how many are being let go.

Rivian is up 3.9% and set to open at fresh 2023-highs of $22.47 after closing higher for seven consecutive sessions, with the electric vehicle maker finding further support today after Wedbush raised its price target to $30 from $25. The broker said Rivian has suffered during a period of ‘one step forward, two steps back’, but that it now sees demand for what it called a ‘unique’ product lineup as analyst Dan Ives said the company is ‘finally making a turn’. The recent rally has been driven by news it delivered more vehicles than expected in the latest quarter and because it has shipped its first electric vans being made for Amazon, its largest customer and shareholder, to Europe. CEO RJ Scaringe also told Bloomberg this week that the supply chain is much healthier now than it was in the last quarter, which should help it ramp-up production as it tries to produce 50,000 vehicles this year. ‘We want to make sure we over-deliver on our numbers, over-deliver on our targets,’ he said.

Nikola is up 1.5% before the bell. The electric vehicle startup has delayed its annual general meeting for a second time this year, this time until August 3, as it struggles to secure enough support from shareholders for a key proposal to increase the amount of shares it can issue. It needs a majority of shareholders to back the proposal, which would allow it to raise fresh equity. This is not the first time Nikola has struggled to convince investors to let it raise money after it delayed its meeting last year on numerous occasions for similar reasons. Nikola recently announced it was cutting costs in order to reduce the amount of cash it is burning through as it cash balance continues to dwindle but the difficulty in raising new equity will increase fears it could hit financial trouble.

Mullen Automotive is down 1.9% today and continues to stir discussion amongst retail traders. The company, which is a tiny player with a valuation of just $110 million, has surged higher recently after it retained a law firm to ‘combat naked short selling activities’. It believes it ‘may have been the target of a market manipulation scheme involving naked short selling’ and is now investigating. Over 16% of its float is shorted, according to the latest data from Fintel. That announcement has caused record trading volumes in the stock, with almost 1.4 billion shares trading hands on Wednesday and 1.9 billion traded on Thursday. That compares to its 100-day average of just 71 million! Mullen announced last month that it sold 22 of its electric cargo vans to Randy Marion Automotive Group and booked its first quarterly revenue of $308,000 in the three months to the end of June.

Another smaller EV startup, Fisker, is down 1.6% after it produced fewer cars than hoped in the second quarter. It managed to produce 1,022 of its Ocean SUV, way below the 1,400 to 1,700 it was aiming to make. It blamed delays in getting hold of components from suppliers for the miss. Still, the output marked a significant rise from the 55 vehicles produced in the first quarter.

Flying cars – or vertical take-off and landing aircraft – continue to create hype as multiple stocks continue to stir the imagination of the markets. Lilium is up 1.2% after completing a European safety audit to keep it on track to secure an all-important licence needed to get its aircraft off the ground while Joby Aviation is up 3.5% after also making progress by passing the third of five-stages to get its aircraft active in the US. Both stocks have flown higher since the start of May as their ambitions edged closer toward becoming a reality, but have seen a pullback this week.

Apple is down 0.2%. The iPhone maker is just about holding onto its $3 trillion valuation but remains below the all-time highs hit a week ago. Apple is planning to sell its new Vision Pro mixed-reality headset through in-store appointments in select locations in the US early next year, according to unnamed sources speaking to Bloomberg. They will first become available in select hubs such as in New York and Los Angeles before being rolled-out nationwide and then other international markets at the end of 2024, with the UK and Canada earmarked as the first overseas markets. It will be made available to buy online in the US from 2024 too. That comes after reports suggested Apple has had to scale-back production due to the complexity of the design.

Microsoft is down 0.2% this morning, having rallied yesterday after Morgan Stanley said it expects it to join the $3 trillion valuation club within the next year, naming it as it as its Top Pick amongst large cap software companies. It believes generative AI will significantly expand the scope of its business and that its valuation remains reasonable despite the surge seen in 2023.

Markets have initially welcomed Meta’s launch of its new social media platform named Threads that is designed to compete directly with Twitter, with the latest update suggesting it has already seen 30 million users sign up. The stock is up 0.3% this morning. Twitter has threatened to sue the company, with CEO Elon Musk tweeting that ‘competition is fine, but cheating is not’ in response to reports of a potential lawsuit. ‘Twitter intends to strictly enforce its intellectual property rights, and demands that Meta take immediate steps to stop using any Twitter trade secrets or other highly confidential information,’ Twitter’s lawyer Alex Spiro wrote. A Meta spokesperson said there were no former employees of Twitter working on Threads.

Amazon is up 0.6% and M&A news is the focus today. We discovered yesterday that European antitrust regulators are opening up an in-depth probe into its proposed takeover of iRobot. Meanwhile, CEO Andy Jassy rejected the idea Amazon could spin-off its cloud-computing arm Amazon Web Services, which makes the bulk of the company’s profits, during an interview with CNBC yesterday.

Alphabet, the most unloved member of Big Tech this year, is trading marginally lower before the bell. Broker’s views on the Google owner is at its weakest in over a year and the search engine giant trades at a discount to its rivals as markets ponder whether artificial intelligence poses a threat or an opportunity for the company and worry about the state of the advertising market, where it makes all of its money. The Information reported yesterday that Alphabet has delayed the release of custom chips made for its Pixel smartphone by at least a year, which will force it to keep using Samsung chips in the meantime. The report said it will also move production over to Taiwanese giant TSMC once its new chip is sorted.

NVIDIA is up 0.3%. The stock has pulled back since hitting all-time highs last month as markets began to question its lofty valuation that has soared higher this year thanks to its prospects around AI, with rising tensions between the US and China also causing concerns. Still, it remains not far below those highs. AMD is up 0.4%. We discovered yesterday that Cathie Wood’s Ark Investment Management sold $2.7 million worth of shares in NVIDIA to reinforce the idea that its valuation is at profit-taking levels while Ark’s Autonomous Technology & Robotics ETF bought over 24,000 shares in AMD for around the same amount. That suggests some are starting to act on the huge valuation gap between NVIDIA and other chipmakers. For example, NVIDIA currently trades at a forward price-to-earnings ratio of 48.5x while AMD trades at just 32.2x.

Alibaba is up 3.2% amid reports that regulators are about to fine its fintech affiliate Ant Group at least CNY8 billion, equal to around $1.1 billion. The news is being seen as supportive as it could draw a line under the probe into the financial behemoth, paving the way for Ant Group to secure a financial holding licence and revive its IPO prospects after being previously derailed by regulatory pressure.

Biogen is in play after the US Food & Drug Administration have its Alzheimer’s treatment named Leqembi approval, marking the first time a drug has reached this stage. The drug, developed in partnership with Eisai, should allow it to be covered by broader range of insurance schemes. However, there are conditions, such as the requirement for it to carry the strongest safety warning.

Visa is down 0.3% at $238.18 despite MoffettNathanson raised its price target on the payments giant to $320, marking a new high on Wall Street. The broker also bumped-up its view on rival Mastercard to a Wall Street high of $490, with an Outperform rating on both stocks. Mastercard is trading marginally lower at $393.10 this morning.

Levi Strauss is down over 8% and at five week lows of $13.15 after cutting its outlook for the remainder of the year. The jeans maker said it is now expecting annual adjusted EPS of $1.10 to $1.20 rather than its original range of $1.30 to $1.40. That meant its guidance slipped below the $1.29 forecast by analysts. Sales fell over 9% in the latest quarter but came in as expected while quarterly adjusted EPS of $0.04 was better than the $0.03 forecast but down heavily from the $0.29 profit reported the year before. Analysts said wholesale remains the problem and is countering ongoing strength from its direct-to-consumer business. A slew of brokers lowered their price target in response, with the lowest coming in at $14 and the highest at $15.

Cryptocurrency stocks Marathon Digital, Riot Platforms and Coinbase are down 0.1% to 0.9%. Bitcoin is rebounding from a three-day losing streak today but holding above $30,100. Markets are focused on news that the largest crypto exchange Binance has been hit by an exodus of executives.