Equities on average went nowhere this past week as investors remained mostly on the sidelines. While volume perked up a bit from the preceding week, it remains low. The Dow Industrials, which are loaded with multi-nationals, edged higher by only 0.04% as the dollar rose against most currencies. The S&P 500 fared better with a 0.4% move to the upside and technology stocks helped the NASDAQ gain nearly 1%. The biggest drag on the averages was the telecommunication sector souring by 3.5%, thanks to uninspiring results from Verizon Communications and a drop in price of AT&T following it proposed takeover of Time Warner for a whopping $85.4 billion in cash and stock. Most of the other sectors did well, led by basic materials, which popped 2%.
Earnings results continue to arrive in fits and spurts with little surprises. However, Morgan Stanley and Goldman Sachs helped the financials and Microsoft lent a hand to other technology plays with better-than-expected results. Oil remained above $50/bbl. and pundits believe the worst may be over for energy with more nations willing to participate in OPEC’s output cuts. A fall in crude stockpiles also helped support West Texas Intermediate prices, which hit a 15-month high of $51.60 during the week. Gold also advanced on the strong dollar.
On Friday, we will get a sense of GDP growth for the third-quarter with an estimated annual rate of 2.5%, according to Bank of America Merrill Lynch. Report of jobless claims and September durable goods’ orders will also get some attention. Earnings will continue to pour in, too. This week we will hear from income choice Kimberly-Clark with an estimate for the third quarter of $1.54 vs. $1.51 last year; conservative candidates 3M Co. ($2.14 vs. $2.05), United Parcel Service ($1.44 compared to $1.39) and Colgate-Palmolive ($0.73 vs. $0.72); and aggressive pick Dow Chemical with an estimate of $0.80 vs. $0.82 a year ago.
On a personal note, thebuttonwoodproject celebrated its sixth year of service on Saturday. Results have been decent, while not spectacular; as the basis for the blog is to educate and promote ideas for long-term investors and to provide meaningful insights in approaching the complexities of Wall Street. I hope you have enjoyed reading my posts as much as I have enjoyed writing them.
Here is the answer to last week’s trivia question: Virtually all Major League Baseball teams are privately held. Which team, however, is traded on the NASDAQ? Atlanta Braves, Minnesota Twins, Kansas City Royals or Arizona Diamondbacks. Answer: Atlanta Braves. The tracking stock (see glossary), The Liberty Braves Group (NASDAQ – BATRA), owns and operates the Atlanta Braves and associated real estate projects. The Liberty Braves Group operates as a subsidiary of Liberty Media Corporation. The Toronto Blue Jays is owned by publicly held Rogers Communications, but is not independently traded.
Today’s Trivia Question: As thebuttonwoodproject enters its seventh year, I have posted 1,492 times. How many views from readers have been made of these postings over the past six years? 2,981, 5,440, 8,002 or 13,624.