The Dow Jones Industrial Average was buoyant on Thursday, up 0.8% at 12:10 p.m. EST. A cooling of tensions between the U.S. and Iran may be a driving force behind the gains.

Tech giants Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT) were both outperforming the market on Thursday. Apple stock jumped after double-digit iPhone shipment growth in China was reported for December, and Microsoft stock rose after an analyst predicted major cloud wins in 2020.

Apple's China sales rebound

Apple has been having a tough time in China over the past few months. On a year-over-year basis, iPhone sales in China were down 10.3% in October, and down a whopping 35.4% in November. That's according to data from Credit Suisse.

It looks like the situation improved last month. Bloomberg reported on Thursday that Apple's iPhone shipments in China were up 18.7% in December. The iPhone 11 is apparently seeing stronger demand than its predecessor, raising the odds that Apple will report solid quarterly results later this month.

The iPhone 11 in various colors

Image source: Apple.

Apple doesn't have a 5G iPhone available, which could put it at a disadvantage to Chinese smartphone vendors this year. Apple is widely expected to launch a 5G iPhone in September, but analysts at Susquehanna expect the first 5G iPhone to support only the slowest variant of the networking technology. Faster versions will likely come three to four months later, according to the analysts.

Also on Thursday, analysts at Jefferies substantially raised their price target on Apple stock. Jefferies' old price target of $285 was bumped up to $350, driven by expectations that Apple will report impressive holiday-quarter results. Jefferies found that foot traffic at Apple's stores has been solid this holiday season, with Black Friday traffic the best it's been in three years.

All of this positive news pushed shares of Apple up 2.1% by early Thursday afternoon. So far this year, the stock has gained about 5.5%.

Analyst optimism boosts Microsoft

Microsoft is well positioned to capture a growing share of the cloud infrastructure market, according to the optimistic analysts at Wedbush. Wedbush said on Thursday that its confidence in the company has increased after performing some checks.

Wedbush sees the deal flow for Microsoft's Azure cloud platform coming in stronger than expected. Based on enterprise customers and partners spoken to, Wedbush expects Microsoft to win the majority of upcoming major cloud deployments, beating out the market leader, Alphabet's Amazon Web Services.

Wedbush boosted its price target on Microsoft stock from $185 to $195, and it sees the stock potentially hitting $210 if its bull case fully plays out.

Microsoft is coming off a strong year for its cloud computing business. The company scored a surprise win when it snagged the $10 billion JEDI cloud contract from the U.S. Department of Defense, and Azure has been gaining market share while Amazon has been losing it. Microsoft is still in a distant second place to AWS, but it's closing that gap.

Shares of Microsoft were up 1.3% on the analyst price target bump. The company is expected to report its quarterly results at the end of this month.

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