Despite a two hundred plus point gain for the Dow on Wednesday, the market ended up pretty much where it started the week. Weighing on equities was a combination of nervousness of a default on Greek debt and a Congressional vote to derail the Pacific trade bill, which offset bullish retail sales and jobless data. The International Monetary Fund walked away from talks on the Greece bailout issue citing “major differences”. Retail sales jumped 1.2% in May and figures for the previous two months were revised upward, thanks in part to auto buyers and gasoline sales as motorists took to the roads. For the week, the Dow and S&P 500 were virtually flat, with the NASDAQ giving up about 0.3%. On sector-by-sector view, there was divergence among strong financials and consumer goods stocks vs. weakness in technology, energy and utilities. Transports were again negative by 1%, on average. Traders are quickly moving away from high-yielding REITS, telecoms and utilities in an attempt to get ahead of eventual market weakness in these areas when interest rates start to rise. Nonetheless, a well-balanced portfolio of high-quality income producing stocks should do fairly well on a total return basis over the longer-term. Year-to-date, the Dow has gone from 17,983 to a close on Friday of 17,899, for a negative 84 points. So if your monthly brokerage statements aren’t what you would like them to be, you’re not alone. Looking at the week ahead, the Federal Reserve isn’t expected to make any substantive changes in its monetary policies when it makes a formal announcement on Wednesday. However, traders will be hanging on every word for clues as to the FOMC’s interpretation of economic data and what that might mean for an interest rate hike in the third quarter.
Here is the answer to last week’s trivia question: WD-40 Company is: Privately held, a division of Occidental Petroleum Corp., a publicly traded company or owned by private equity firm Apollo Group? Answer: San Diego-based WD-40 Co. is a publicly traded company listed on the NASDAQ under the symbol WDFC. Besides its namesake product, WD-40 Co. also makes 3-IN-ONE Oil, Lava Soap, Carpet Fresh and other household cleaners.
Today’s Trivia Question: Qualcomm, one of the first cell phone manufacturers and developer of the Palm operating system, sold its mobile phone manufacturing division in 2000 to: Nokia, Motorola, Kyocera or Samsung?