March 24, 2014 – March 28, 2014
It was not a very good week for the markets, on Monday NASDAQ fell 1.2% as investors sold to take profits, particularity in the biotech sector. The Flash Manufacturing PMI for March was released showing 55.5 for March, with the new orders component coming in even stronger at 58. Numbers above 50 indicate expansion.
On Tuesday, the consumer confidence report for March was much stronger than expected coming in at 82.3, a six-year high, compared to February’s 78.3. Markets rallied strongly on the news. Also released was the Case-Shiller Home Price Index showing homes increased .8% month to month in 20 tracked cities, with the year over year rate increasing 13.2%. New homes sales in February came in at 440,000, down from January’s 455,000.
On Wednesday, the markets traded lower after President Obama warned that the Ukraine crisis may escalate, and investors took that as a sign to take some profits as a cautionary stance. Durable goods for February were up 2.2%, but it didn’t impress the market much because after removing the volatile transportation component it only showed an increase of .2%.
On Thursday, mixed economic reports caused a lot of sideways movement in the markets. GDP for the 4th quarter 2013 came in at 2.6%, softening from the 3rd quarter growth of 4.1%. New jobless claims also came down to 311,000, with the four week moving average at 318,000, its lowest level in 6 months.
On Friday, reports showed monthly personal income for February increased .3%, and consumer spending increased .3%. Inflation continues to be tame at .1% higher than last month.
Now let’s take a look at some stocks.
Facebook (NASDAQ: FB) shares fell following Tuesday’s announcement that the company will be acquiring Oculus VR for approximately $2 billion. Oculus is a leader in immersive virtual reality technology. This would be Facebook’s second huge acquisition following the purchase of WhatsApp for $19 billion. Facebook shares are facing pressure due to shareholders’ nervousness that these large acquisitions will not prove smart expenditures.
Microsoft (NASDAQ: MSFT) Corporation announced Thursday they will be releasing multiple applications and services which includes MS office for the Apple (NASDAQ: AAPL) iPad and free Office Mobile apps for both iPhone and Android phones. The new version designed for the iPad offers a touch-version of Office which will be available for download for free, but a subscription is needed to allow users to create and edit documents. Microsoft stock stayed depressed during Thursday’s trading day.
Lululemon Athletica Inc. (NASDAQ: LULU) surged on Thursday after the company released their 2013 Q4 earnings report showing that the company has made $521 million in revenue, up 7%, year-over-year, and beating estimates by $4 million. The company also reported that net income was at $109.7 million or $0.75 per share, also beating analysts’ projections of $0.72 per share. Lululemon has rebounded nicely since the debacles that riddled the company in 2013.