Monday August 20, 2018 – Friday August 24, 2018
On Monday there wasn’t much economic news as the S&P 500 continued rallying towards setting a record high. Ten year Treasuries finished the day yielding 2.82% and West Texas Intermediate crude settled at $66.47 a barrel.
On Tuesday, markets continued to gain as signs emerged that trade talks between the U.S. and China may lead to a cooling of tensions.
On Wednesday existing home sales for July declined .7% to 5.34 million units and the EIA petroleum status report for the week ending August 17th saw crude oil inventories decline 5.8 million barrels. The Federal Reserve released minutes from their last meeting ending August 1st. Fed officials noted concern at the potential for tariffs to disrupt the economy. Increasing tariffs would reduce purchasing power of U.S. households and disrupt supply chains. Also of concern is a significant weakening in the housing sector and a sharp increase in oil prices. The FOMC mentioned that references to policy being accommodative may soon need to be removed and replaced with neutral language. The current bull market turned 3,453 days old, to become the longest rally in U.S. history, exceeding the previous record from 1990 to 2000.
On Thursday jobless claims for the week ending August 18th declined 2,000 to 210,000 and new home sales for July fell 1.7% to an annualized 627,000 units. Markets fell modestly as new tariffs with China took effect.
On Friday durable goods orders for July declined 1.7% compared to the prior month’s .7% gain. Markets opened higher on Fed Chair Powell’s positive comments about the economy. Now let’s take a look at some stocks.
PepsiCo, Inc. and SodaStream International Ltd. (NASDAQ: SODA) announced on Monday that they have entered into an agreement under which PepsiCo will acquire all outstanding shares of SodaStream for $144.00 per share in cash.
Momo Inc. (NASDAQ: MOMO) announced second quarter financial results on Wednesday. Net revenues increased 58% year over year to $494 million while net income was $117 million compared to $60 million a year ago. Monthly active users on the Momo app were 108 million in June 2018, up 18% from the same period a year ago.
Target Corporation (NYSE: TGT) reported second quarter results on Wednesday with total revenue of $17.8 billion, up 6.9% from $16.6 billion a year ago. Second quarter adjusted EPS were $1.47, up 19.8% year over year. Shares rose to over $88 post announcement.
Lowe’s Companies, Inc. (NYSE: LOW) reported second quarter sales of $20.9 billion, up 7.1% year-over-year and same-store comparable sales increased 5.2%. Net earnings of $1.5 billion increased 7.1% compared to $1.4 billion a year ago.
Alibaba Group Holding Limited (NYSE: BABA) on Thursday announced its revenue jumped 61% to USD 12.2 billion in its fiscal first-quarter, driven by robust growth in its e-commerce business and cloud division. Cloud computing revenue surged 93% to USD 710 million. Over 77 million shares were traded on Thursday, with a closing price at $172.10.