Markets hiccuped today
Today was a non-event but the market and many stocks sagged. Why?
My guess is end of the year profit taking.
The news of the day that mattered (BBY reported strong sales, NUE admitted to steel weakness, and the Fed did not raise rates) were all positive but the market took the news badly.
CONSUMER SPENDING REMAINS STRONG
Best Buy (BBY)'s earnings showed strong sales (up 16% YoY) and equally strong margin pressure (gross margins dropped 1%).
Fortunately, Flat Panel LCD TV sales were incredibly high.
Texas Instruments (TXN) also reported chip sales stumbling. This is partly a cell phone problem and partly rising competition.
The markets sensed potential problems with consumer spending and took it out on chip companies as well as PC companies (Apple got clipped for this and a slowdown in iTunes business).
TRID took a similar tumble, despite heading for a massively powerful quarter. I estimate that this company is now at a 17 P/E and a PEG of 0.35. This is a takeover candidate, especially once they resolve the options bullshit and release earnings for the last 2 quarters.
MATERIALS GET HIT
Nucor (NUE) reported that steel is hurting. I have been saying that there is a steel surplus and it is finally showing up in the numbers. ATI got hit hard (8%), TIE somewhat hard (3%+). This is not, repeat NOT tied to a slowdown in demand but to an aggressive oversupply out of China. China's demand has dropped and it is also exporting its excess, driving down spot prices.
TIE got hit in sympathy - they make Titanium for Boeing whic hhas 8 years of plane demand - but ATI makes steel products.
OTHER MOVEMENTS
ILMN dropped 1.5% from an analyst covering them as HOLD
KSU up a bit
NTRI continued its slide
NUAN up ~7% on 4X the average volume. I think that a takeover is possible.
T up. I knew we should have bought back
UCTT held ground - a good sign.
MVL down 5%
My guess is end of the year profit taking.
The news of the day that mattered (BBY reported strong sales, NUE admitted to steel weakness, and the Fed did not raise rates) were all positive but the market took the news badly.
CONSUMER SPENDING REMAINS STRONG
Best Buy (BBY)'s earnings showed strong sales (up 16% YoY) and equally strong margin pressure (gross margins dropped 1%).
Fortunately, Flat Panel LCD TV sales were incredibly high.
Texas Instruments (TXN) also reported chip sales stumbling. This is partly a cell phone problem and partly rising competition.
The markets sensed potential problems with consumer spending and took it out on chip companies as well as PC companies (Apple got clipped for this and a slowdown in iTunes business).
TRID took a similar tumble, despite heading for a massively powerful quarter. I estimate that this company is now at a 17 P/E and a PEG of 0.35. This is a takeover candidate, especially once they resolve the options bullshit and release earnings for the last 2 quarters.
MATERIALS GET HIT
Nucor (NUE) reported that steel is hurting. I have been saying that there is a steel surplus and it is finally showing up in the numbers. ATI got hit hard (8%), TIE somewhat hard (3%+). This is not, repeat NOT tied to a slowdown in demand but to an aggressive oversupply out of China. China's demand has dropped and it is also exporting its excess, driving down spot prices.
TIE got hit in sympathy - they make Titanium for Boeing whic hhas 8 years of plane demand - but ATI makes steel products.
OTHER MOVEMENTS
ILMN dropped 1.5% from an analyst covering them as HOLD
KSU up a bit
NTRI continued its slide
NUAN up ~7% on 4X the average volume. I think that a takeover is possible.
T up. I knew we should have bought back
UCTT held ground - a good sign.
MVL down 5%
posted by Andrew at
9:44 PM
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