Amazon Stars in End-of-the-Week Drama!

Stocks ended the week mixed, with the S&P 500 recording negligible gains of 0.1%, the NASDAQ dropping 0.9% with pronounced tech sector weakness. The market’s focus at the beginning of the coming week will remain on tech stocks, which stabilized on Friday after having seesawed all week long, after being hit by massive selling at the beginning of the week. The tech sector (XLK) was the week’s worst-performing sector, shedding 1.1%.

Investors will also continue to respond to Amazon’s (AMZN) large and unforeseen move to acquire Whole Foods Market (WFM), making a $13.7 billion offer for the supermarket chain. The move shook up retail and food chains, erasing in the process, on aggregate, billions of dollars of their market caps. While Amazon offered to buy WFM at a valuation of $42 per share – a move that led to a 29% surge in the latter – competing store chains fell sharply on Friday. Target (TGT), for example, plummeted 5.14%, the largest U.S. supermarket chain, Wal-Mart (WMT) slashed 4.65%. The speculation on the market is that WFM might get a counter bid, a fact that caused the stock to end slightly above $42, Amazon’s offer price.

Friday’s movement could have been expected to be sluggish, in keeping with the slow summer months – if not for the drama piqued by Amazon. That notwithstanding, despite the jump in volumes in light of Friday’s “triple witching” option expirations, most of the market was rather quiet.

A whole slew of political news and economic events last week had laid the groundwork for substantial market movement, but when push came to shove, the only event that really had an impact on market movement was Fed Chairwoman, Janet Yellen’s announcement that the Fed was hiking rates, but more importantly, her comment that the central bank hopes to start normalizing its balance sheets later this year. The bears for quite some time already have been expecting the Fed to be the catalyst sparking a turnaround in the market; and the fact that the Fed had let its stimulus-driven balance sheet mushroom to $4.3 trillion, quantitative easing bond purchases and all, was to be, the main driver behind a deep correction, they were hoping. Until now, they’ve grossly erred, but the market’s response last week to the Fed announcement proves that their approach wasn’t baseless.

This coming week, Wednesday’s existing home sales figures will be key, as will be the case with Friday’s new home sales figures, along with Markit’s manufacturing figures. There will be half a dozen Fed bankers who will be speaking this coming week, which kicks off with the speech of the N.Y. Fed branch, William Dudley, on Monday. The speeches are likely to shape market movement in the event they give voice to concern about the latest weakness in the newly released economic figures – or hint at the bank slowing its rate hike pace, a fact that would suggest Fed concerns about the robustness of the economy.

Crude prices are likely to be consequential for stock movement, while traders are carefully looking to see whether crude will succeed in maintaining the support level of $45 a barrel, or on the flipside, whether it will fall deeper in the direction of the next support level at $40, perceived far and wide as a slippery slope for the market. The crude ended the week at the $44.74 level, with cumulative weekly losses of 2.4%.

In Summary for the Week: We now find ourselves in one of the least opportune seasons for the market, June itself being one of the worst-performing months historically. The Federal Reserve is now off the radar screen, and in the absence of any significant earnings reports in the near future, there really isn’t any news of substance that could serve as a driver behind market movement. Traders will need to continue to focus on movement in individual stocks, without resting their laurels on the market on large.

IndexLastDaily change
DJX0.11%21,384Up
SPX0.03%2,433Up
Nasdaq(0.22%)6,152Down

Have a great trading week!

 

Economic Calendar

 

DAYTIME (EST)EventForecastImpact
Tuesday8:30Current Account Balance-$123.4BMedium
Wednesday10:00Existing Home Sales5.52MMedium
Wednesday10:30Crude Oil InventoriesLow
Thursday8:30Initial Claims240KHigh
Thursday9:00FHFA Housing Price IndexMedium
Friday10:00New Home Sales599KMedium

 

 

Earning Calendar

 

SymbolCompanyAM/PMDay
LENLennar CorporationAMTuesday
RHTRed Hat, Inc.PMTuesday
FDXFedEx CorporationPMTuesday
ADBEAdobe Systems IncorporatedPMTuesday
KMXCarMax Inc.AMWednesday
ORCLOracle CorporationPMWednesday
CACICACI International IncPMWednesday
HAINThe Hain Celestial Group, Inc.AMThursday
CCLCarnival CorporationPMThursday
CMCCommercial Metals CompanyPMThursday
ACNAccenture plcPMThursday
BBBYBed Bath & Beyond Inc.PMThursday

 

Today’s Picks – Day Trading!

SymbolBreakoutBreakdownMomentumMomentum
WRK57.86CVNAAN
CBI$15.00PSXGIS
AMAT$42.32OXYTGT
URI$102.73HIIQHSY
PDCE$44.00 BWA
  WBA
  BGS
   
   
   
   

 

New York Strategy Swing

#DateStockLong\

Short

StatuesData CloseProfit\

Loss

11.5.2017AAOILongClose2.5.2017+0.54%
23.5.2017SCSSLongClose9.5.2017-1.71%
34.5.2017CRZOShortClose5.5.2017+0.30%
48.5.2017WTWLongClose16.5.2017+6.09%
515.5.2017AANLongClose16.5.2017-1.70%
616.5.2017CCLLongClose17.5.2017-0.41%
717.5.2017AMAGShortClose24.5.2017+5.38%
817.5.2017AANLongClose24.5.2017-2.59%
919.5.2017TRCOLongClose23.5.2017-1.45%
1019.5.2017GIMOLongClose26.5.2017+2.05%
111.6.2017BF.BLongClose6.6.2017+0.95%
127.6.2017LULULongClose9.6.2017-2.24%
1314.6.2017SIGShortOpen -1.90%
1416.6.2017YHOOLongOpen-0.36%
15
16