Wall Street yawned at much of this week’s headline news including the President’s meeting with North Korean dictator Kim Jung-un; an all-but-expected Federal Reserve interest rate hike; and a go-ahead of the $85 billion mega-merger between AT&T and Time Warner. But escalating tariffs with China, bad blood with our allied trade partners in Europe, Canada and Mexico and the prospect of an additional rate hike this year turned traders negative later in the week. However, the S&P 500 was curiously flat over the past five trading sessions and the Dow gave back less than one percent through it all. The NASDAQ managed a nice 1.3% gain and transportation stocks were strong on news of more oil being produced by OPEC that could lower fuel costs.
Of the ten market sectors, half were higher on the week, led by consumer goods and services and utilities. The OPEC treat, however, sent energy stocks lower by 3.2%. Gold declined by $23.50/oz. to settle at $1,274.60 as the dollar strengthened over most other currencies. Tuesday we will hear from Oracle Corp. to see how it fared in its final fiscal quarter of the year. Street expectations are at $0.94 per share vs. last year’s $0.89, but Oracle is always full of surprises.
So, the push and shove among bulls and bears continues with little conviction in either direction. And my sense is that this year’s back-and-forth action will continue for a while, leading to further range-bound results along with bouts of volatility in a pricey market. However, there are still pockets of values out there, but given the elevated level of equities, investors will need to be selective. Best to sit back and let the traders fight it out for now and enjoy the rest of the Father’s Day weekend.
Here is the answer to last week’s trivia question: What company is the world’s largest auto manufacturer by revenue? Volkswagen, Daimler, Toyota or General Motors. Answer: Toyota with sales in 2017 that exceeded $277 billion.
Today’s Trivia Question: Jim Beam bourbon whiskey has been around since 1795. The brand is owned by? Diageo, Brown-Forman, Constellation Brands or Suntory Holdings.