Apple and Amazon lead the race to 1,000 billion in the stock market

Apple and Amazon lead the race with 1,000 billion in the stock market

Amazon's market capitalization approaches 1,000 billion dollars / & copy AFP / Archives / Lionel BONAVENTURE

Who will be the first to reach the milestone of 1,000 billion dollars on the stock market? Long alone in the lead in the quest for this Grail, Apple has just been joined by Amazon without the fear of a new technological bubble.

Apple, 939 billion dollars, remains the private company the most expensive in the world on the markets. And it could very well pbad the symbolic threshold after the publication of its quarterly results Tuesday.

But Amazon is on the lookout: its market capitalization climbed Friday to 917 billion dollars, before ending at 882 billion, thanks to quarterly figures well received by investors.

Alphabet (866 billion), the parent company of Google, and Microsoft (827 billion) are also in the running, while Facebook (505 billion) is for moment disqualified by losing $ 119 billion after the release of its results on Thursday.

The largest exponents of the traditional economy, the holding of billionaire Warren Buffett Berkshire-Hathaway (492 billion) and the bank JPMorgan Chase (395 billion), were relegated to the rank of spectators.

The company of Chinese state PetroChina had briefly crossed the milestone of 1,000 billion in 2007 when it was floated on the stock market but was soon back down.

– Refugee Sector –

According to the TD Ameritrade website, used by many of retail investors, the online trading giant Amazon was the most popular title in the first half of the year, while Apple was the second most sold out.

"The average investors investing in Amazon are also those who use its services, "notes JJ Kinahan who badyzes these data for the company. Investors "see it as an action that still has a lot of growth potential and benefits from the increased purchasing power (of the Americans) thanks to the improvement of the economy," he adds. [19659004] But Apple, which unveils record numbers quarter after quarter, keeps hands.

Ken Berman, strategist for the brokerage site Gorilla Trades, bet that the apple brand will exceed $ 1,000 billion after its results Tuesday thanks the rising price of its iPhone, the growing interest in its iPad and the strength of its services.

"In my eyes, the Apple action is probably not expensive enough," says Nate Thooft Manulife Asset Management.

The new Apple Store in Milan, Italy, July 26, 2018 / & copy AFP / Piero CRUCIATTI

"The technology sector is the safe haven of the market right now, its profits are the most constant, its accounts are the most balanced, the innovation is there," he explains.

We're good far from the situation of the late 1990s, when a multitude of startups have seen their title explode on Wall Street even as their strategy was barely sketched, provide several badysts.

– New economic model –

"The big problem of the internet bubble was that most companies had no income, no profits, many were just a fad, and nothing to do with all the companies that have has become an essential part of people's lives, "says Gregori Volokhine, fund manager for Meeschaert Financial Services.

"At the time, most of these companies traded on the stock market at a price that exceeded more than 100 times their profits," said Kate Warne market specialist at Edward Jones. Nothing comparable today.

For Apple, the ratio of stock price to earnings is currently 18.62, below the S & P 500, the index that represents the 500 largest companies listed on Wall Street. (20,86)

Even in the event of an economic crisis, the technology sector is well positioned, notes Maris Ogg, portfolio manager for Tower Bridge Advisors. "If companies have to make cost reductions, they will invest in technologies to replace any laid-off people."

For Nicholas Colas of DataTrek Research, it is also difficult for investors to evaluate strategies for relatively new business model

"These are basically ideas created by a handful of people, developed and maintained by perhaps 10,000 coders (sometimes much less), but used by billions of people around the world," note there. "It is possible that the markets do not yet understand what must be a valuation + correct or normal +".

(© AFP / July 29, 2018 07h35)