Plus, Reddit and several other major websites were down early this morning due to a Fastly outage, Bitcoin is dropping after the U.S. recouped most of the ransom paid to the hackers that took down the Colonial Pipeline last month, and one analyst says Apple could hit a $3 trillion market cap next year.
Stocks were higher at the open on Tuesday with the Dow adding 15 points, or less than 0.1%. The S&P 500 rose nearly 0.2%, while the Nasdaq gained 0.5%.
Clover Health shares are up more than 82% at the time of writing as Reddit’s WallStreetBets forum moved beyond meme stocks. Redditors are encouraging each other to take advantage of the largest short interest in Clover and are aiming to squeeze out the short sellers. “This looks like the perfect setup for a combined short and gamma squeeze,” one trending Reddit post said. “I see no reason why CLOV couldn’t reach the same price point as AMC did last week (>$70). It might even go higher than that.” Wendy’s is another addition to the retail-trader frenzy, and is up 18% so far today as it gains traction on social media and on Reddit. “The power of the network effect of social media entices more people to get involved, so then they start broadening their horizons, looking for other names that have high short interest and things like that,” said Michael O’Rourke, chief market strategist at JonesTrading.
Speaking of Reddit, it and many global news websites—including the Financial Times, New York Times, and Bloomberg—experienced intermittent outages early this morning. Amazon, Twitter, PayPal, Spotify, and Twitch were also affected by the outage. Content-delivery network Fastly was responsible for the outage, and has since fixed the issue. “This is what happens when half of the internet relies on Goliaths like Amazon, Google, and Fastly for all of its servers and web services,” said Gaz Jones, technical director of digital agency Think3. “The entire internet has become dangerously geared on just a few players.”
Bitcoin is down more than 13% at the time of writing to $31,246. The plunge comes as concerns grow that the world’s largest cryptocurrency isn’t beyond government control after U.S. officials recovered nearly all of the Bitcoin ransom paid to the perpetrators of the cyber attack on the Colonial Pipeline last month.The U.S. said it recouped around 63.7 Bitcoin traced to recipients of a 75-Bitcoin ransom paid by Colonial soon after the early May attack that resulted in a shutdown of the nation’s largest gas pipeline, causing fuel shortages across the east coast. The fact that investigators “could trace the untraceable and seize it might be undermining the libertarian, free-of-government-control case” for Bitcoin, said Jeffrey Halley, senior market analyst at Oanda.
Southwest Airlines said it is increasing its order for Boeing’s smallest 737 Max model by 34 planes, just two months after committing to buying 100 of the planes as demand for air travel accelerates. The aircraft will be delivered next year and will bring Southwest’s planned 737 Max 7 fleet to 234 planes. Southwest said it expects to spend around $1.5 billion on aircraft next year, up from its previous projection of roughly $700 million. The order is good news for Boeing as it shows that the most significant 737 customer is still committed to the plane despite the controversies that previously grounded the plane for nearly a year.
And Wedbush analyst Dan Ives said Apple could hit a $3 trillion market capitalization in 2022, up from its current valuation of $2.1 trillion. “If you look at the innovation, if you look at the supercycle playing out in the services business right now, I believe this is just sort of the next stage of growth,” Ives said, adding that the jump in valuation would be seen in “12 to 18 months from now.” “They have put an iron fence around their install base, continue to monetize it, and the bears and skeptics will continue to doubt them,” Ives continued. Given that Apple continues to “prove them wrong. … Which is why when I look around the corner, despite this digestion period, I see a $3 trillion market cap (in) 2022.”
Stocks We’re Watching
22nd Century Group Inc (OTC: XXII): 22nd Century Group shares gained 13% yesterday after the biotech announced new initiatives to strengthen and maximize revenue opportunities in its hemp/cannabis franchise, including strategic partnerships with two plant breeders, a close partnership activity with Aurora Cannabis, and the establishment of a newly created Canadian subsidiary. “The addition of breeders who specialize in alkaloid-based plant cultivation to our network of strategic partnerships provides us with the competitive edge to commercialize our second-generation IP and technologies,” James A. Mish, CEO of 22nd Century Group, said in a press release. “As cannabis regulation evolves, we believe that companies able to control the traits and consistency of the plants will command a premium price and margin in the marketplace. 22nd Century is well-positioned to capitalize on the tremendous potential in the global legal cannabis space by creating hemp/cannabis plants that have stable, specific cannabinoid levels at commercial scale for various end-use markets.”