Wall Street ended the week on a mixed note on Friday, in quiet trading. True, for the holiday-shortened week, equities made a comeback, but it appeared to be focused around lower-quality stocks that have been beaten down attracting bargain hunters. While advancing stocks outnumbered decliners by 5-1, the generally low volume was not encouraging. The Dow Industrials and S&P 500 moved higher by 2.5% and NASDAQ tacked on 167 points or nearly 4%, and market sectors were in the green, with technology shares leading the pack, followed by consumer services and industrials. Oil was able to at least remain stable, which brought some bidders to the table, with the price of West Texas Intermediate closing virtually unchanged at $29.64/bbl., which some market watchers are no calling a bottom for crude.
Economic news has been mixed with positives in employment, industrial production and housing starts being overshadowed by tepid spending for capital projects, lackluster gains in retail spending and slow growth abroad. Monetary policy easing by central banks to spur some kind of economic improvement in Asia and Europe is also weighing on buyers to get back into the market with any conviction. The lack of leadership by financial stocks, along with energy related issues, is also a concern.
The earnings season for the fourth quarter of 2015 was less than inspiring and guidance has been woefully weak. Some big retailers will be reporting earnings for the all-important holiday quarter, including Lowes, Home Depot and Macy’s. Aggressive candidate Foot Locker reports on Friday, with estimates of $1.12 vs. $1.00 a year ago. We will also hear from Royal Bank of Canada this week with expectations of $1.67 for its first quarter of fiscal 2016, unchanged from the same period last year. And finally, Federal Reserve presidents will be out in force this week with their outlooks on the economy and monetary policy, so mid-week, especially, may be the more volatile of the trading days.
Here is the answer to last week’s trivia question: The Coca-Cola Co. is in a dispute with the U.S. Patent and Trademark Office on its Coke Zero trademark. The challenge to Coca-Cola is being led by rival? PepsiCo, Dr. Pepper Snapple Group, Cott, or Monster Beverage. Answer: Dr. Pepper Snapple Group, which markets its Diet Rite products as “Pure Zero”. PepsiCo also challenged the “Zero” trademark in Great Britain in 2007, and won the case there.
Today’s Trivia Question: S.C. Johnson & Son, maker of such products as Saran Wrap, Pledge, Glade, Windex, Raid and Ziploc bags is? Privately held; a division of Church & Dwight; Publicly held trading under the ticker symbol SCJN; or owned by private-equity firm The Carlyle Group.