January 3, 2020

Stocks: TSLA, FCX, WDC

Macro: SPY, XLE, Oil, ISM Report, GDPNOW

Well, that wasn’t so bad? The way it was being portrayed at 8:30 AM, you would have thought the market would have been down a lot. “The Dow futures are pointing to a 300 pointing decline at the opening.” So you mean about 1%? My favorite, “Oil prices are soaring today.” You mean Oil went up 3%, big deal.

But even better, the energy sector couldn’t catch a bid; it was down on the day. Yeah, the XLE was down. Wow. Do you know what that should tell you? Investors hate the energy sector so much, even what should have been viewed as a bullish news event couldn’t get the group higher. That isn’t very good.

S&P 500 (SPY)

The S&P 500 fell a stunning 70 basis points today, that’s less than 1%. 😉 As I have been saying, the S&P 500 has been in an overbought condition for some time, and at this point, any negative headline will be reason enough for some investors to exit.  Premium content – Stock Pointing To Lower Open- Morning Commentary
Preferably I would like to see the S&P 500 fall to around 3,150. But that’s me.

ISM

Let move on to the ISM report, which was weaker than expected, at 47.2, lower than estimates of 49.1, “the worst reading since 2009”. Let’s pull in the drama again. And your point is? The ISM report still suggests a fourth quarter GDP growth rate of 1.3%. Meanwhile, the Atlanta Fed GDPNow is pointing to a fourth quarter growth rate of 2.3%. Is 2.3% a remarkable growth rate? No. I’d like to a three handle. But it in no way suggests the economy is anything close to the scenario of 2008 or 2009. 

Just too much drama today, honestly. 

Tesla (TSLA)

Tesla had a good day, with the stock “SOARING” to a new all-time high at $442. The company reported better than expected fourth quarter deliveries. I’m still confused; I remember reading in May about how demand for the cars was plunging and how the absence of the Federal Tax credit would kill the company. No? Oh well, I guess that didn’t work out so well for the bears. Could the stock go to $475, maybe? 

The one part of my writing I haven’t mastered yet, is how to insert witty sarcasm? Are you suppose to use italics? If anyone knows to feel free to email me.

Hey, I have come a long way. For those of you that have read me long enough, you probably remember when nearly everything I wrote made no sense. Now, only half of what I write doesn’t make any sense ;P

Freeport (FCX)

Freeport didn’t have a good day, but look the stock did what it had to do; it held support at $12.70. For now, that’s good enough; it means it gets to fight another day.

Western Digital (WDC)

I mentioned today in a free article that Western Digital is closing in a big break out that could send the stock higher towards $76. Also, the bullish option bets are another reason.

Anyway, that’s enough for a Friday. Even with the market closed on Wednesday, this felt like a long week. Well, today felt like two days. Maybe it’s because I have been getting up at 4:30 AM over the last few days, which I can’t figure out why. Anyway, back tomorrow.

-Mike

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