Shortly after new U.S. tariffs were announced in May 2019, the S&P 500 lost $1.2 trillion.
Shortly after that, China retaliated, announcing tariffs on $60 billion worth of U.S. goods, making the situation so much more “fun” that it already was.
Worse, according to analysts at the time, “Our view is this could escalate for at least a matter of weeks, if not months, and it’s really to get the two back to the negotiating table and finish the deal, is probably going to require more pain in the markets. Really the only question is if we need a 5%, 10% or bigger market correction,” said Ethan Harris, Bank of America Merrill Lynch, as quoted by CNBC.
Of course, it took a big bite out of stocks.
However, it may also create a “blood in the streets” opportunity for investors. Some of those opportunities include:
Curaleaf Holdings (CURLF)
With the latest, short-lived pullback in cannabis stocks, CURLF has become aggressively oversold. And we believe now is a great time to accumulate shares. We also believe the stock could soon list on a major exchange after many of its major competitors. one of the most exciting stories for investors has been the push by marijuana stocks to list of major U.S. exchanges in the U.S. and abroad. By doing so, cannabis companies draw bigger investors, including institutional investors that aren’t often able to invest in OTC-listed stocks. While there’s nothing wrong with listing on the OTC, a major exchange offers a bigger audience of potential investors, and Wall Street firms. Many cannabis stocks have seen their share prices run higher in anticipation of, and after, listing on a major U.S. exchange.
Apple Inc. (AAPL)
We believe we’re being offered another opportunity, as the incredibly beaten down stock begins to recover from a low of $170. Plus, with the trade war showing some signs of cooling off near-term, Apple will benefit from that, too. Better yet, major analysts are now saying, “The bad news is over” for the stock. Technically, the stock is aggressively oversold at bottom of trend. What we’d like to see here is a potential reversal to at least $200, near-term.
Intel has been severely beaten down to a 52-week low on trade war concerns. After an incredible pullback, Intel is severely oversold at triple bottom support. It’s also oversold at its lower Bollinger Band (2,20) with RSI, MACD, and Williams’ %R all telling us this sell-off may be overdone. We believe that the trade war fears are priced in.
Cree Inc. (CREE)
CREE provides lighting-class light emitting diode (LED), lighting, and semiconductor products for power and radio-frequency (RF) applications in the United States, China, Europe, South Korea, Japan, Malaysia, Taiwan, and internationally. It operates in three segments: Wolfspeed, LED Products, and Lighting Products. We believe Cree could push significantly higher after the pullback. In fact, it’s just beginning to rebound from an oversold prices of $60. Our near-term target is $80 on the stock.
Etsy, Inc. (ETSY)
ETSY operates as a commerce platform to make, sell, and buy goods online and offline worldwide. Its platform includes its markets, services, and technology, which enabled users to engage its community of sellers and buyers. The stock was another unfortunate victim of the trade war pullback. However, it appears the worst has been priced into the stock.