The Moskowitz Report (SHLD, GS, WMT, GWW, IBM, RL, TSLA, KSS, FB, XRT, GOOGL, M, AAPL, JWN, JPM, NFLX, DDS, BA, JCP, BAC, JNJ, AMZN) - Stock Market Commentary For Wednesday, April 19, 2017
Today was an excellent example of what happens when even the biggest of names have earnings misses. Goldman Sachs (GS) had earnings in line with expectations last night but revenues and guidance were a little lighter than the Street wanted and we opened @$219.89 – 6.43 and just got worse all day finishing @$215.59-10.67 or 4.67%. WW Grainger (GWW) did the same and finished @$197.57-25.40 or 11.39%, while IBM had numbers after today’s close and is currently trading @ $161.92 -9.18. JNJ was also not immune to the disappointment as it missed and closed $121.82-3.90 or 3.1%. As I’ve said before, repeatedly, this market has absolutely no tolerance for anything but perfection.
The market internals were not as bad as the decline appeared since GS, JNJ, and IBM are all DJIA stocks, and the NASDAQ was not as bad as the Dow. While A/D was 15:14 down and volume was 3:5 on the NYSE, NASDAQ volume was even while the A/D was only 4:5 down. The Russell was actually up, although only .05%.
The big names were lower with GOOGL-1.14, AAPL -.55, FB -.43, BA -1.17, TSLA -1.39, NFLX -3.96 and AMZN the only winner +.19.
As I mentioned in Sunday’s Weekly Strategies the 10 yr. US Treasury broke to a new low yield closing since the start of the year of 2.25% and today traded lower to 2.16%. This flattens the yield curve and casts doubt on the magnitude of any actual recovery. For that reason, even if GS had not reported, the other financials were lower with JPM - .80 and BAC -.14. I have always maintained that without the financials in gear it is almost impossible to have a healthy bull market. I’m not saying it’s over, but when things are priced for “perfection” it’s easy to see the makings of a correction coming.
Retail was again mixed with M -.11, JWN -.02, KSS -.08, WMT +.40, DDS -.25, RL -.47, SHLD +.57, JCP +.02 and the XRT + .16.
Tomorrow is another day...CAM
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