"Apple Hits Record High on New AI Tools; Oracle Soars 9.3%"

By Bill Bullington

6/11, 18:25 EDT
Apple Inc.
Autodesk, Inc.
Affirm Holdings, Inc., Inc.
Broadcom Inc.
CrowdStrike Holdings, Inc.
Walt Disney Company
Alphabet Inc.
Intel Corporation
Meta Platforms, Inc.
Microsoft Corporation
NetApp, Inc.
NVIDIA Corporation
Oracle Corporation
Paramount Global
Spotify Technology S.A.
AT&T Inc.
Warner Bros. Discovery, Inc. - Series A
Zscaler, Inc.

Key Takeaway

  • Apple (AAPL) surged 7.3% to a record high after unveiling new AI tools, driving significant tech gains; Oracle (ORCL) jumped 9.3% postmarket on cloud partnerships.
  • Regulatory moves and strategic delays: Biden Administration considers AI chip restrictions for China; Intel (INTC) delays $25 billion Israel chip plant construction.

TMT Megacap Watch

Apple (AAPL +7.3%) led gains among major tech names after unveiling new artificial intelligence features at its developer event. Microsoft (MSFT +1.1%), (AMZN +0.1%), Alphabet (GOOGL +0.9%), and Meta Platforms (META +1%) also saw positive movements, while Nvidia (NVDA -0.7%) dipped slightly.

What's Moving the Market

AI Innovations Drive Tech Surge:

  • Apple (AAPL): Apple shares soared to a record high, closing up 7.3%, following the announcement of new AI tools at its developer event. The introduction of these features, which require the A17 Pro and M-series chips, is expected to drive a significant hardware upgrade cycle, particularly among younger consumers.
  • Alphabet (GOOGL): Benefited from positive sentiment as analysts highlighted that Apple's AI focus underscores Alphabet's strong position in the AI space.
  • Oracle (ORCL): Postmarket, Oracle shares jumped 9.3% after announcing cloud infrastructure partnerships with Google Cloud, Microsoft, and OpenAI, signaling robust growth prospects in the AI and cloud sectors.

Regulatory and Strategic Developments:

  • Biden Administration: Considering further restrictions on China's access to AI chip technology, which could impact the competitive landscape for US chipmakers.
  • Intel (INTC): Delayed construction of its $25 billion chip plant in Israel, reflecting strategic pacing of its global investments.

Elsewhere in TMT

Broadband and Streaming Dynamics:

  • NetApp (NTAP +2.1%): Outlined ambitious growth targets at its investor day, driven by a shift to Flash storage and cloud penetration, suggesting potential for low-double-digit EPS expansion.
  • Zscaler (ZS +2%) and CrowdStrike (CRWD +2.7%): Both companies announced partnerships with Nvidia to enhance their AI capabilities, positioning themselves strongly against competitors like Microsoft.
  • Media Sector: Streaming losses are narrowing significantly, with Warner Bros. Discovery (WBD -1%) and Disney (DIS -1.8%) achieving profitability. However, Paramount (PARA -7.9%) continues to struggle, highlighting the varied performance within the sector.

Corporate Actions and Ratings:

  • Affirm (AFRM +11%): Gained on news of its partnership with Apple Pay, which could significantly boost its in-store mobile payment presence.
  • Spotify (SPOT +0.3%): Plans to introduce a premium tier, potentially adding $400 million in annual revenue, signaling confidence in its competitive edge and pricing power.
  • Autodesk (ADSK -3.1%): Fell after announcing an internal investigation of accounting practices, now under probe by the SEC and DOJ.

Analyst Ratings:

  • Apple (AAPL): Upgraded to Buy at DA Davidson with a price target of $230, reflecting strong confidence in its AI-driven growth prospects.
  • AT&T (T): Raised to Neutral at BNPP Exane, while Comcast received a downgrade, indicating mixed sentiment in the telecom space.

Upcoming Earnings:

  • Broadcom Inc. (AVGO): Scheduled to report postmarket on June 12, with investors keenly watching for updates on its AI and semiconductor segments.

Stay tuned for more updates as we continue to monitor these dynamic developments in the TMT sector.