Market Gets Wakeup Call as Euphoria Wanes
Shlomo Cooper, Tradenet Chief Analyst
Earnings Reports Record Improvement though Delays Could Beset Trump’s Plans
Wall Street took a step back yesterday after storm clouds again appeared on the geopolitical front. Stocks traded down on Monday, led lower by the energy sector on the background of a decline in crude prices, as investors decided to wait for the next round of primetime earnings report, while seeking further clarity regarding the economic plans of President Trump. The S&P 500 backtracked after having closed at an all-time high on Friday. The market euphoria is beginning to wane, Wall Street now getting it that not everything will be seen to in Trump’s first 100 days of office. In brief, there’s still a large measure of uncertainty.
In summary for the day, the S&P 500 recorded a decline of 0.21%, the NASDAQ shedding 0.06%.
Economists at Goldman Sachs noted yesterday that it’s more reasonable to expect the U.S. fiscal boost, if it happens at all, to play out in 2018 seeing that Trump’s growth-oriented agenda is likely to be offset by the negative impact of newly carved trade agreements and limitations on immigration.
The biggest movement yesterday was in precious metals, which soared on the background of investor’s desire to tuck away their capital in safer shores in light of growing uncertainty about European elections this year as candidates for once-fringe parties succeed in gaining popularity on the heels of Trump’s election victory. Over the coming months, elections will take place in German, Italy and France. Gold (GLD) lured in buyers yesterday, demonstrating strength with gains of 1.35%, expressing traders’ fears about the trade discussions being held by Trump. Moreover, it seems that Trump’s timetable for some of the items on his agenda is creating uncertainty, the newly elected U.S. president sharing in an interview on Sunday that the repeal of Obamacare may take until 2018. This statement raised questions about the timing of tax reform and the fiscal stimulus initiative, the 2 main topics on Trump’s agenda that had caused stocks to rally after the elections.
One of the stocks commanding attention was Hasbro (HAS) which soared 14.1% after the number 2 toymaker in the U.S. reported a holiday quarter with record sales. Processor and graphic chip maker, AMD, soared 11.4% on the background of favorable coverage it received from Barron’s which projected that the stock’s value is likely to double thanks to its success in retaking once lost market share, and its new management team. Tyson Foods (TSN) fell 3.5%. The company reported that it had received a subpoena from the U.S. Securities and Exchange Commission apparently related to allegations of collusive price fixing in the poultry market.
A number of key companies from different sectors stand to report over the rest of the week, including Coca Cola (KO), Disney (DIS) and Gilead (GILD).
Over half of the companies on the S&P 500 have reported their Q4 results, two-thirds having beaten Wall Street’s earnings forecasts.
On the S&P 500, 15 stocks rose to new 52-week highs, just one stock dipping to a new yearly low; on the NASDAQ, 108 stocks recorded new 52-week highs, 24 falling to new yearly lows.
About 6 billion shares changed hands on U.S. exchanges, beneath the 6.7 billion average over the last 20 trading days.
Tuesday: Michael Kors (KORS), British Petroleum (BP) and General Motors (GM) will be some of the companies from different industries reporting in the morning today. On the economic front, trade balance figures will be released at 8:30 N.Y. time, the consensus being a contraction in the trade deficit to $44.8 billion from the prior deficit reading of $45.2 billion. Additional job market figures will come from the JOLTS survey, which tracks the number of new job openings, the reading coming out at 10:00.
Other companies reporting today before opening include: ADM, CAH, EMR, VMC, TEN. Disney (DIS), and Gilead (GILD) will be among the companies reporting their numbers after closing – along with TWLO, Z, AKAM, and PNR.
Tuesday’s Hot Stocks: FOXA, GPS, FMC, FN, KORS, NOV, CAH, VMC, OMC
Have a great trading day!
|Tuesday||10:00||JOLTS – Job Openings||–||Medium|
|Friday||8:30||Export Prices ex-ag.||–||High|
|Friday||10:00||Mich Sentiment – Prelim||97.9||High|
|TSN||Tyson Foods, Inc.||AM||Monday|
|CTSH||Cognizant Technology Solutions Corporation||AM||Monday|
|NOV||National Oilwell Varco, Inc.||PM||Monday|
|FOXA||Twenty-First Century Fox, Inc.||PM||Monday|
|VMC||Vulcan Materials Company||AM||Tuesday|
|MOS||The Mosaic Company||AM||Tuesday|
|CAH||Cardinal Health, Inc.||AM||Tuesday|
|OMC||Omnicom Group Inc.||AM||Tuesday|
|ORLY||O’Reilly Automotive, Inc.||PM||Tuesday|
|AKAM||Akamai Technologies, Inc.||PM||Tuesday|
|MCHP||Microchip Technology Incorporated||PM||Tuesday|
|GILD||Gilead Sciences Inc.||PM||Tuesday|
|DIS||The Walt Disney Company||PM||Tuesday|
|PXD||Pioneer Natural Resources Company||PM||Tuesday|
|SO||The Southern Company||AM||Wednesday|
|TWX||Time Warner Inc.||AM||Wednesday|
|ALK||Alaska Air Group, Inc.||AM||Wednesday|
|YUM||Yum! Brands, Inc.||PM||Wednesday|
|LVLT||Level 3 Communications, Inc.||PM||Wednesday|
|TSLA||Tesla Motors, Inc.||PM||Wednesday|
|PRU||Prudential Financial, Inc.||PM||Wednesday|
|OXY||Occidental Petroleum Corporation||AM||Thursday|
|CVS||CVS Health Corporation||AM||Thursday|
|RAI||Reynolds American Inc.||AM||Thursday|
|KO||The Coca-Cola Company||AM||Thursday|
|Q||Quintiles IMS Holdings, Inc.||AM||Thursday|
|CCE||Coca-Cola European Partners Plc||AM||Thursday|
|DTE||DTE Energy Company||AM||Thursday|
|AAP||Advance Auto Parts, Inc.||PM||Thursday|
|ATVI||Activision Blizzard, Inc.||PM||Thursday|
|XRAY||DENTSPLY SIRONA Inc.||AM||Friday|
Today’s Picks – Day Trading!
New York Strategy Swing
Today’s Picks – Swing “New-York Strategy
No.1 – UAA
|Company Name||Under Armour|
|Sector||Consumer Goods | Textile – Apparel Clothing|
No.2 – GNC
|Company Name||GNC Holdings|
|Sector||Services | Drug Stores|
|Earning Date||16 Feb|