Major U.S. equity benchmarks opened and ended in green territory on Friday after a frenzy of earnings and economic data releases permeated the headlines and bolstered optimism.
Always Read Beyond The Headlines
As wild as it seems, when considering last week’s absolutely stellar gains on Wall Street from growth bellwethers like Chipotle and Google, the bulls remain in the driver’s seat. Today’s encouraging price action was largely fueled by upbeat earnings and seemingly better-than-expected durable goods data. Technology juggernauts Amazon and Microsoft (MSFT
) kickstarted the rally with solid quarterly results, while stronger-than-expected revenues and shipping volume came in from United Parcel Service (UPS).
Many were also quick to applaud the latest durable goods report, cheering after reading “Durable-goods orders rise 3.7%!” across financial media news outlets. However, as always, we encourage investors to take the time to read beyond the headlines and do their own homework. Upon further review, investors might not be so cheery to discover that without orders from the transportation sector, namely for aircraft, the durable goods figure actually slipped 0.1% in September. Furthermore, orders for core capital goods, which is often considered a leading indicator for business investment, fell by 1.1% last month.
It’s quite likely that the durable goods orders were dragged down by businesses scaling back on spending in light of the political drama that was happening on Capitol Hill last month. Whatever the case may be, it’s becoming clear that market sentiment is entering a dangerous territory where mixed data is still perceived as “good enough” to draw in new buyers from the sidelines.
New Stock Recommendations This Week
Amid broad-based equity indexes charging to new all-time highs this week, we added two opportunities to the Best Dividend Stocks list that offer meaningful yields and are trading at attractive levels. While these stocks likely won’t deliver eye-popping gains over the coming months, you can
No comments:
Post a Comment