Apple, Qualcomm taken off J.P. Morgan's Analyst Focus List on consumer spending worries
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Tech stalwarts Apple (NASDAQ:AAPL) and Qualcomm (NASDAQ:QCOM) were removed from J.P. Morgan's Analyst Focus List as the firm said investors appear to be focusing on concerns related to consumer electronics, citing a potential consumer spending pull-back.
A team of analysts, led by Nicholas Rosato, noted that there were "early signs" of a reversal from value stocks into growth stocks are signs of a recession appear to be a focus of investors, one that is "driving favor towards quality and growth even if it comes at a rich multiple."
The analysts noted there has been "a lot of noise" surrounding tech spending, but as concerns for the global economy start to move into the sector, it could impact a number of end markets and then move into business and commercial spending.
"In this regard, we believe it's apt to moderate our near-term bullishness for shares of [Apple] and [Qualcomm], which we have had on the Analyst Focus List, as we look for clarity on the magnitude of the Consumer spending pull-back," the analysts wrote.
Apple (AAPL) shares ticked up slightly higher in premarket trading on Friday to $174.87, while Qualcomm (QCOM) rose slightly more than 0.5% to $153.86.
Instead, the firm is moving Arista Networks (ANET) and Ciena (CIEN) to the Analyst Focus List, as it expects "strong resiliency in spending from both Telecom customers towards their networks, as well as from cloud companies towards building infrastructure to support workload migration to the cloud."
On Wednesday, Apple (AAPL) started allowing certain apps, including Netflix (NFLX) and Spotify (SPOT), to allow sign-up links that point outside Apple's App Store.