April 19, 2018.
The major indexes didn’t change much at the end of the day, but there were more than a few companies in the spotlight. For one, Amazon (AMZN), which had not disclosed its Prime client numbers in the past, announced that it had hit the 100 million mark. Maybe – just maybe – it was the company’s CEO, Jeff Bezo’s way of sticking it to Trump, who seems to have tried to hurt Amazon by threatening its joint venture with the U.S. Postal Service. The market was sure to reward Amazon, which rose 1.60% on the day. I.B.M. (IBM) was another stock in the limelight, tumbling 7.6%.
As for future markets, at present we can expected subdued action at the opening.
RJ Hottovy, an analyst at Morningstar Inc., noted, “What we’re seeing in Europe and other markets is similar to what we saw in the U.S. between 2010 and 2014.” He focused on the added value of Prime: “People see value in Prime memberships in terms of shipping speed and content. It’s important to investors because membership retention rates are north of 90 percent.”
Offering a word of advice for other companies as well, Bezos commented, “People are pretty good at learning high standards simply through exposure,” adding, “High standards are contagious. Bring a new person onto a high standards team, and they’ll quickly adapt. The opposite is also true. If low standards prevail, those too will quickly spread.”
In after-hours trading, American Express (AXP) rose 3%, the company beating on the earnings and revenues fronts, while also lifting its full year guidance. With that said, the company’s expenses were higher than expected as the company spent more on customer retention in the face of growing competition. Likewise, it was the company’s first quarter under the helm of a new CEO.
Alcoa (AA) was another stock that saw lively movement after closing. In late-trading, the company rose 4%, the company outstripping top and bottom line forecasts. Interestingly enough, the company, in its earnings statement, noted that it anticipates a widening global deficit for aluminum and alumina this year.
Kinder Morgan was up over 1% in extended trading after its mixed earnings announcement. The energy company only just beat analyst’s consensus on the bottom line, but revenues came out far short of estimates. The cherry on top though was that the company raised its quarterly dividend by 60%.
Philip Morris (PM) will be one of the main companies reporting today, along with Skechers (SKX).
The International Monetary Fund (IMF) was also on center-stage after warning that in light of the tide that has lifted financial assets and the latest geopolitical developments, things are looking rather like what unfolded before the financial crisis 10 years ago. The IMF’s economists pointed to growing risks to a certain degree over the last 6 months in so far as global growth goes; it highlighted drop-bottom interest rates in many countries and the large volatility in capital markets as being the reasons for such. Pointing to liquidity, the IMF noted that we could see a re-evaluation of asset values rather suddenly.
Lastly, the Beige Book, which is released 8 times a year pointed to the American economy continuing to be solid.
Daily Summary: The Dow slipped 0.16%, the S&P 500 seeing light gains of 0.08%. The NASDAQ edged up 0.19%. The NASDAQ is up 3.20% over the last 5 trading days. All-in-all, the sectors on the S&P 500 ended mixed, energy stocks up 0.61% and material stocks tacking on 0.52%. The weakest sectors were utilities, which fell 0.51% and consumer staples, which lost 0.81%. Six sectors ended up, 5 ending down. The energy sector is up 2.60% over the last 5 trading days.
Thursday’s Hot Stocks: AA, AXP, SNBR, URI, TSM, BBT, PM
Have a great trading day!