Shall we declare a winner in January's tug of war between
? I think we shall, as yesterday's washout put investors solidly
on the defensive. It's amazing how things can turn on a dime.
Wednesday after the bell momentum king
put the pedal to the metal with a stellar earnings report. Shares
soared in the after-hours market. As we slumbered here in the
States, things took a turn for the worse overseas. China released
economic data that for the first time in six months suggested
That was enough to tilt the war in favor of the bears. We
started weak from the get-go and selling accelerated throughout
the day. There were minimal attempts to nibble at these
discounted prices, but not nearly enough to change the negative
tenor of the day. The major indexes were all down approximately
1% on the day.
was the lone bright spot finishing the day with a gain of more
eBay ekes out small gain
The negative tone in the market put a damper on what could
have been a strong day for
. The online auction site and owner of PayPal released
earnings after the market closed Wednesday. The company beat
earnings estimates by a penny per share and matched revenue
expectations. Guidance was below consensus, but an announcement
had taken a stake in the company supported shares.
For his, part the activist investor is suggesting that eBay
would be worth more if it spun-off its PayPal business.
Management has thus far resisted such talk, but Icahn tends to be
quite persistent in these matters.
Whatever transpires is likely to be good for investors. The
stock opened smartly higher before succumbing to the bear tidal
wave. Shares finished up only fractionally - still a good result
on a tough day.
Union Pacific riding the rails
There is nothing but blue skies ahead for the rail sector.
Union Pacific (
had a nice gain of 3% after a solid earnings report. The company
beat earnings estimates by 6 cents per share, thanks to higher
shipments of grain easily offsetting a decline in coal shipments.
With a steadily growing United States economy and low valuation,
Union Pacific should continue its impressive run.
McDonald's stock moves higher despite sales
On the surface, with a horrible market day and a disappointing
sales number for
one might think shares were crushed. That was not the case as
investors ignored the bad news of the day. Instead they chose to
focus on the good news of an earnings report that beat estimates
by a penny per share. That was enough to convince the market to
focus on putting a tough year for the company in the rear-view
mirror. The focus is on the future and apparently the current
sentiment is that
will have a decent year. Shares closed at $95.26, up
Homebuilders and gold fare well as yields sink
One consequence of the weakness in China and a down market for
stocks was yields falling. The ten-year Treasury note yield fell
to 2.77%. That strength supported
as the yellow metal added $24 a near 2% gain. Shares of
Toll Brothers (TOL)
finished the day in the green. The big winner was
KB Home (KBH)
with a gain of 1.4%.
Stocks are set to fall further in the
stock market today
. Trading overseas was weak. Could a contagion be taking hold?
Only time will tell.
On the earnings front
issued a strong report and shares are higher in
. It was a cautious, but still solid report from
. It too is seeing green in pre-market trading.
Market's rarely recover on Friday after a Thursday sell-off.
Investors tend to be cautious as we head into the weekend. Look
for the same today. At best we open lower and trade sideways with
perhaps some tepid buying at the close. We hope you enjoyed this
issue of the
Stock Market Today
. As always, please feel free to leave a comment below.