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Wall Street Gains Confidence as Major Concerns Ease
Investor uncertainty on Wall Street diminished this week as two significant concerns—the trade war with China and inflation—have shown signs of resolution. Although negotiations between the world’s largest economies are ongoing, both parties revealed increased alignment on key issues. In addition, Tuesday’s inflation report indicated results below expectations for the third consecutive month. Grocery prices experienced their most considerable decline in nearly five years, while gas prices dropped for the third month, countering the narrative that tariffs would trigger inflation. Below are three crucial stocks to focus on:
First Solar Soars on Encouraging Legislation
Shares of leading solar company First Solar (FSLR) surged nearly 20% on Tuesday, marking a 50% increase so far this month. Following a recent rally from lower prices, news that solar incentives will remain unaffected by budget cuts propelled the stock significantly. Tax credits for First Solar and other solar companies will extend through at least 2028. Additionally, FSLR garnered two critical upgrades:
Wolfe rated FSLR as outperforming, citing clear potential for $10B earnings from 45X credits, translating to approximately $92 per share. They emphasized FSLR’s strong domestic position as the only sizable manufacturer of solar modules without dependence on foreign components like cells or wafers.
Deutsche Bank (DB) echoed these sentiments, highlighting FSLR as a potential safe choice amid legislative changes, largely unaffected by 45X credit fears.
After experiencing underperformance for six months, FSLR’s shares have reclaimed their 200-day moving average, with trading volumes surging to five times the usual levels.
CoreWeave Shows Strength After IPO Base Structure
CoreWeave (CRWV) has begun a promising upward trajectory following its IPO base structure. Specializing in cloud computing, CoreWeave offers high-level processing power for large-scale computing and AI tasks. Shares rose nearly 10% and are approaching earlier all-time highs ahead of earnings. The company reminds many of Alphabet (GOOGL), which exhibited similar patterns prior to its breakout.
Supported by institutional investors like Nvidia (NVDA), CRWV must deliver robust earnings tomorrow to sustain its current momentum; however, the recent price trends are encouraging.
Image Source: TradingView
OKLO Shares Rise on NuScale Earnings Report
Oklo (OKLO) experienced over a 10% increase in share value as trading volume doubled the 50-day average, following strong results from nuclear “small modular reactor” company NuScale Power (SMR). OKLO is set to report its earnings shortly. As the sole SMR company to receive approval from the US Nuclear Regulatory Commission, NuScale’s positive performance could prompt expedited regulatory approvals across the sector, especially given the energy landscape’s current dynamics and former OKLO board member Chris Wright’s position as the new US Secretary of Energy.
Bottom Line
This week, investor confidence significantly increased as two major uncertainties dissipated, driving several stocks across various sectors to new heights.
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