Monday, February 15, 2021 – Markets Closed
Tuesday, February 16, 2021 – DIA 315.58 +.17%, QQQ 335.54 -.27%, SPY 392.30 -.09%
No highly impactful market data. Equity markets started the week robustly but began to fade as traders' attention began to focus on the big freeze in Texas. The 10-year Treasury note edged up to 1.3%. Inflation is clearly developing and becoming more evident in commodity prices. From food to basic materials and oil, prices are surging for goods. The best sector today was Energy (XLE) 45.79 +2.51% followed by the financials (XLF) 32.06 +1.71%. Chinese internet plays continued to do well; Baidu (BIDU) 326.20 +4.22%, and JD.com (JD) 103.43 +4.15% both hit new highs. With virus news improving, cruise line operators surged; Royal Caribbean (RCL) 74.20 +9.71%, and Carnival (CCL) 22.47 +9.08% both continuing their recovery.
Wednesday, February 17, 2021 – DIA 316.60 +.32%, QQQ 333.93 -.48%, SPY 392.39 +.02%
In the face of harsh winter weather conditions blanketing most of the USA and sustained low temperatures not seen in a century, Retail Sales jumped 5.3%, surprising analysts who were expecting a small gain of 1.1%. Despite energy market disruptions in Texas, WTI (West Texas Intermediate-a primary market and benchmark for USA oil -check me) continued to trade higher despite an announced Saudi production increase.(Usually dilutive and negative) Energy Services (XLE) 46.47 +1.49%, and Consumer Discretionary (XLY) 170.56 +.58% led the DJIA (DIA). The laggard was Technology (XLK) 136.92 -.88%. Online travel services company Expedia (EXPE) 154.04 +4.19% hit a new high. Apple (AAPL) 130.84 -1.76% appears to be breaking a trendline from the March 2020 low. Berkshire Hathaway (BRK/B) 245.25 was reported to have taken a large position in Verizon (VZ) 56.99 +5.24% which gapped higher after a significant pullback in recent weeks.
Thursday, February 18, 2021 – DIA 325.56 -.33%, QQQ 332.47 -.44%, SPY 390.72 -.43%
Initial Jobless Claims were much higher than expected 861K vs. 765K. Continuing Jobless claims were also higher than expected 4.494M vs. 4.413M. Building Permits came in stronger than expected @ 1.881M vs. 1.678M, but Housing Starts were lower than expected 1.58M vs 1.658M. The markets were quiet but lower as traders focused on the GameStop (GME) hearings in front of Congress. They focused on market structure and “payment for order flow”. Energy (XLE) 45.42 -2.26% came under a bout of selling pressure after a significant run. Walmart (WMT) 137.66 -6.48% was pounded after reporting disappointing earnings and giving a weaker outlook for 2021. Chip design software company Synopsys (SNPS) 270.95 -4.51% beat earnings but the outlook was weak going forward and the stock took it on the chin. Software company Brightcove (BCOV) was the moonshot de jour as it exploded 24.77 + 21.78% after blowing out earnings and revenue numbers & giving positive future guidance.
Friday, February 19, 2021 – DIA 314.92 - .01%, QQQ 331.02 -.44%, SPY 390.03 -.18%
Markit Manufacturing PMI came in as expected 58.5. Markit Services PMI came in better @ 58.9 vs. 57.5. Equity markets traded mixed to down in a quiet session Basic Materials (XLB) 75.05 +1.83% led, followed by Energy Services (XLE) 46.18 +1.67%. Baidu (BIDU) 339.91 +14.06% beat on earnings and traded to new highs. Caterpillar (CAT) 209.91 +5.00% broke out to new highs on anticipated demand in Texas to rebuild the water & sewer systems and reinforce the power grid. Three COVID-19 diagnostic companies were down on heavy volume; Quidel (QDEL) 182.59-13.09% (beat estimates but guided lower) West Pharmaceutical (WST) 281.55 -5.12%, Hologic (HOLX) 75.69 -8.07%. Recent trends for the virus show substantial progress and that “herd immunity” could be at hand.
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