Equities continue to bounce around positive and negative territory reliant on any headline news that suits trader’s fancy. The current level of stock prices since the January high has provided what technicians call a consolidation period or moving sideways until some catalyst forces a new direction. Should the economy continue to fire on all cylinders, it would suggest that the next leg is up, despite headwinds from the Federal Reserve and potential trade wars. My optimism is centered around expectations of a pickup in consumer purchases at stores and online, with results buoyed by further job gains, fatter paychecks and tax refunds.
Thanks mostly to a rally on Friday, stocks ended the week pretty much where they started. The Dow Industrials and the S&P 500 barely budged giving up about 0.2%. The NASDAQ, however, provided a gain of 1.2%, as technology stocks outperformed the overall market, and were the only clear winners for the week. Conversely, telecom stocks retreated over 5% on M&A concerns for the group, with a renewed hookup between T-Mobile and Sprint sending both issues down in price and Verizon Communications reacting negatively to the potential of stiffer competition in the wireless space. Health care names were also on the losing side of the ledger, giving back 2.6%, on average. Job growth in April came in under estimates at 164,000, but the March job number was revised upward. The unemployment rate fell to 3.9%, a 17-year low.
Wall Street is trying to cope with a number of cross currents. For the most part, earnings and the economy are proving supportive, while interest rates, trade issues and global tensions are pressuring prices. All the while, the indexes remain in a tight band around the break-even line for 2018. Expect more volatility and ongoing ebbs and flows until a clearer picture unfolds.
Here is the answer to last week’s trivia question: CVS Health, a buttonwoodproject conservative choice, owns about 9,800 retail drugstores throughout the U.S including Target outlets, except for which state? Hawaii, Alaska, Wyoming or North Dakota. Answer: Wyoming
Today’s Trivia Question; Behr Process Corp. (better known as BEHR Paints) is owned by? The Behr Family, Home Depot, Masco Corp. or Bain Capital.