Energy, healthcare and utilities were not able to participate in the 2.5% gain in the Dow 30 this past week, but all the other sectors made significant gains led by technology and industrials, higher by 4.4% and 3.3%, respectively. Equities were lifted by possible stimulus moves by the European Central Bank and an interest rate cut by the People’s Bank of China in an effort to kick-start a weakening economy. Earnings season has been a ho-hum affair thus far, with many companies being squeezed by the strong U.S. dollar and unevenness in emerging markets. However, some notable exceptions provided for a number of wild swings this past week. On the plus side, Microsoft, Amazon.com, McDonald’s and Alphabet (nee Google), were strong performers offset by steep losses from the likes of Sketchers, Harley-Davidson and Pandora Media. Other news sent shares of Valeant Pharmaceuticals down by 35% in reaction to negative press regarding its business model and drug company AbbVie was lower by over 9% on adverse reactions to its Hepatitis C drug. Weight Watchers, however, liked the $43 million investment by Oprah Winfrey, bidding the shares higher by 132% for the week. On average, sentiment remained elevated as the NASDAQ and the Dow Transports gained about 3% and the S&P 500 was up over 2%, pushing the index into the black for the year by 0.8%. The small-cap Russell 2000, however, was virtually flat for the week. Oil future prices were down on inventory figures and a stronger dollar, with West Texas crude hitting a multi-week low of $44.60/bbl. down by $2.66 since last Friday. Merger and acquisition news heated up in the technology space with semiconductor equipment maker Lam Research planning a takeover of rival KLA-Tencor and Western Digital bidding $19 billion for SanDisk. Wednesday will end a two-day meeting by the Federal Reserve and an unlikely change in policy and a rate hike. For blog readers, earnings from Gilead Sciences and United Parcel Service will be released on Tuesday and Friday we will hear from conservative choices Colgate-Palmolive and CVS Health.
On a personal note, I take pleasure in recording the fifth anniversary of thebuttonwoodproject this week and hope the site has provided some meaningful investment insight for my loyal followers. Looking forward to better times as we begin year six.
Here is the answer to last week’s trivia question: The unique nine-character alphanumeric code that identifies a financial security for the purposes of facilitating clearing and settlement of trades is known as?: CUSIP, Registrar ID, Transfer Agent Identifier, CHCT. Answer: CUSIP the acronym for Committee on Uniform Security Identification Procedures
Today’s Trivia Question: Which pizza chain is the largest by both total revenue and number of locations, world-wide? Domino’s, Little Caesars, Pizza Hut or Papa John’s.