Market 2018-01-24 (Dollar, Defense, and more)

Indices are mixed today. Nasdaq manages to recover half of the intraday loss, finishing -0.6%.

Mortgage applications jump 4.5% last week as buyers rush to lock low interest rates. Refi up 1%.

Treasury Secretary Steven Mnuchin says"weak dollar is good for US economy". This is short-sighted and irresponsible, which may trigger trade wars. Moreover, treasury yields will jump if Foreign investors lose confidence in green bills, thus increasing borrowing cost and causing recession. One example is the weak Japanese Yen in recent years. The economy has been trapped no matter how hard its government tries to stimulate. The case in US could be worse.

The weak dollar (UUP -1%) boosts commodities: Crude +2.28% to $65.94. Gold +1.53% to $1,357.20. Once again, pay attention to inflation.

Winner

Financial sector is strong today, GS +2.1%, MS +0.6%, WFC +1.5%, JPM +1.3%, C +1.2%, BAC +0.5%...AIG +3.2%

GWW +18.5% after reporting EPS of $2.94 beat by $0.74, Revenue of $2.63B (+6.5%) beat by $60.00M.

NFLX +4.4% and WHR +4.1% rally again.

Chinese Techs: JD +3.5%, BABA +1.7% on its way to $200, QD +7% (too bad I sold my shares yesterday), YY +1.6%

RCL +4.2% after reporting Q4 EPS of $1.34 beats by $0.14, Revenue of $2B (+4.7% Y/Y) beats by $30M. CCL +3.9%

Defense companies deliver strong earnings. GD +5.8% after reporting Q4 EPS of $2.50 beats by $0.12, Revenue of $8.28B (+8.2% Y/Y) misses by $130M, with improved cash flow and margin. UTX (-0.2%) is relatively quiet after ER beat. RTN +0.9%, LMT +0.5%.

 Biotech companies are also doing well in earnings. NVS +4.8% after reporting Q4 EPS of $1.21 beats by $0.02. Revenue of $12.92B (+4.9% Y/Y) beats by $130M.

 ABT +4.2% after reporting Q4 EPS of $0.74 beats by $0.01. Revenue of $7.59B (+42.4% Y/Y) beats by $200M. However, IBB -0.8% amid profit-taking after a strong YTD run. I expect other biotech companies will report strong earnings.

CMCSA +1.3% after ER beats and dividend & buyback boosts.

Losers

Airlines have a very bad day, as UAL (-11.4%) plans to start "price war" --- to add U.S. capacity over the next 3 years at over a 6% pace. AAL -6%, ALK -6.9%, DAL -5.2%, LUV -4.7%...

TXN (-8.5%) tumbles after ER. LRCX -2.5%, AMAT -1.6%. I will buy if it falls below $100 (around $110 now).

GE -2.6% after reporting  EPS of $0.27 missed by $0.01, Revenue of $31.40B (-5.1%) missed by $2.66B. Power business down 15%. BHGE -5.7% after ER beats. I am very disappointed as GE CEO seems to have no clear picture how to turn the company around. However, I will hold my patience for another 1-2 quarters.

QCOM -0.5% after receiving $1.2B fine from EU antitrust regulators.

DUST -6.3% as gold miners enjoy the gold price breakout.

MAT -2.8% as ToysRUs to close 175 stores.

AH Earnings


  • LVS (-0.3%)  Q4 EPS of $0.88 beats by $0.11. Revenue of $3.44B (+11.7% Y/Y) beats by $170M. Shares +0.9% in AH.
  • CCI (-0.7%) Q4 EPS of $0.17 misses by $0.07. Revenue of $1.24B (+20.4% Y/Y) beats by $90M. Shares +0.7% AH.
  • LRCX (-2.5%) Q2 EPS of $4.34 beats by $0.66. Revenue of $2.58B (+37.2% Y/Y) beats by $10M. Shares +2.9% in AH.
  • F (+0.8%) Q4 EPS of $0.39 in-line. Revenue of $41.3B beats by $4.31B. Shares -0.8% AH.
  • URI (-0.2%) Q4 EPS of $3.34 beats by $0.05. Revenue of $1.92B (+26.3% Y/Y) beats by $40M. Shares -0.6% in AH.
  • WHR Q4 EPS of $4.10 beats by $0.08. Revenue of $5.7B (+0.7% Y/Y) misses by $160M. Shares -0.8%.

My Trades Today

  • Add more PG.
  • Bought GME @ $16.8
  • Bought LUV @ $62
  • Bought BOTZ @ $27

Comments

  1. JasonJanuary 25, 2018 at 1:03 AM

    很好奇，为什么买的BOTZ，而不是AI的个股呢？

    ReplyDelete
    Replies
    1. UnknownJanuary 25, 2018 at 8:34 AM

      在目前高价位，我觉得选个股风险比较大，BOTZ囊括了涵盖全球工业和科技的几十支股，现对来说稳妥一些

      Delete

Post a Comment

Popular posts from this blog

Wanna Retire Early, Start Planning Now!

Image
It is very important to plan your retirement  as early as possible.  Why? It is because the money you put into investment will grow fast. If you put $1k into your retirement account at age 20, it will grow into $15k when you reach age 60, assuming 7% annual return rate. As comparison, if you put $1k at age 30, it will only grow into only $7.6k, about half of the former case! One popular topic these days is to get retired early, for instance, at the age 50. Assuming the average yearly expense (including medical cost) is $100k and you live to age 90, you need at least $4M by age 50. Of course if you plan to get retired at age 60, then the retirement fund will be smaller ( $3M ). There is a new phrase " Million Dollar Poor "  ---- $1M may only support you from age 70 to 80 --- retire @ age 70 and decease @ age 80. In this article, I would like to introduce the possible stable income sources for retirement. (This is a brief introduction, for more details, please ask your
Read more

Impacts of Tax Reform --- My First Thoughts

Senate passed the messy tax reform bill last night. The new tax code will start in 2019 (not 2018). The next step will be negotiation between Senate and the House to put together the final bill for Trump to sign. Put aside how the tax reform will affect personal finance, one thing is for sure --- corporate tax rate will drop from 35% to 20% . Multinational companies will also bring cash back to US. Corperate Tax Rate Drop Well, many big companies have already managed to pay low tax rate, for instance, IBM pays only ~10%. You can find tax rate information in companies' ER. Therefore, not everyone benefits from the 20% tax rate. Following are a few companies who are paying tax rate > 35% (most in retailers and restaurants). Restaurant: CMG, DENN... Retailers: CVS, LVS, GPS, JWN, M... Auto retailers: AN, KMX... Healthcare: Anthem, HUM, DGX, DVA... Transportation: JBHT, LUV... Energy: COP, PSX... Industrial: GWW... Financial: SCHW, PAYX... Utility: WEC...
Read more

Market 2018-02-05 (WOW.... Bloody)

The quick bounce in the morning turned out to be a trap. The selloff is so violent that there are almost no survivors. The deep dip  around 3pm is especially evil. The market is definitely in panic mode. Dow -4.6% to 24,343. S&P -4.1% to 2,649. Nasdaq -3.8% to 6,967. And the selloff continues in AH. The money floods into Treasuries : 30-year +1.12%. 10-yr +0.74%. 5-yr +0.51% . 10-yr note drops from above 2.85% to 2.7% (about last Tuesday/Wednesday level). This may calm some nerve. Currently it is hard to predict how much lower indices will go. I would suggest to prepare your own shopping list and start to add positions. I am fully positioned myself. I plan to hold and wait. Commodities: Crude -2.73% to $63.66 . Gold +0.28% to $1,341.00 . Bitcoin is also facing another run of selloff as major US & UK banks ban Bitcoin credit card purchases . The lowest price today is below $6600 from coindesk. To be honest, there is no particular bad economic news today. Instead, we
Read more

US Treasuries and Yields

Image
Rising Treasury Yields have been a hot topic in the past few weeks, which is blamed to be the reason behind recent  market correction. Some people are totally panicked as 10-year yield approaches 3%. I would suggest to " Keep Calm and Carry On ". In this article, I would like to give you some background, and possible trend. US Treasuries Basically US treasuries, including short-term and long-term, are the national debt of United States (国债). US currently have debt of $20T . Debt/GDP ratio is 104% in 2017 , as shown in the chart below (grey bars represent recessions). As comparison, China Debt/GDP ratio is 46% in 2016; Japan is 238% . The debt falls into two broad categories: Intragovernmental Holdings and Debt Held by the Public. Intragovernmental Holdings $5.6T, 30% of total. This is the portion of the federal debt owed to 230 other federal agencies, such as the Social Security Trust Fund. This part is not affected by market. Debt Held by the Public $1
Read more

Market 2018-02-06 (XIV, MU, MOH, and more)

It is a choppy day. The early tradings are similar to yesterday --- opened low followed by a quick bounce. However, indices hung around afterwards and marched north around 2:30 pm. Dow +2.3% , S&P +1.7% & Nasdaq +2.1% . I think the -10% correction is over. The indices retreated back to pre-TAX-Reform level in the intraday low. However, it could remain the choppy way for near-term. Utilities has the worst performance, XLU -1.5% despite the broad market rally in late hours. Treasurys: 30-year -0.9%. 10-yr -0.6%. 5-yr -0.4% . 10-yr note stays @ 2.8%. Commodities: Crude -1.1% to $63.45. Gold -0.9% to $1,324 . The American Petroleum Institute (API) reportedly shows -1.05M barrels of crude oil for the week ending Feb. 1 vs. last week's build of +3.23M barrels. Gasoline reportedly shows -227K barrels and distillates show a build of +4.52M barrels. I think refiners face margin challenges. Yesterday, many analysts called for buying dip instead of being panic. Goldman's D
Read more