Stocks rallied today on light volume. The Dow was higher by 88 points to 18,329. Stocks continue in a trading range and IBD is signaling a rally mode even though volatility is on the rise.
America’s pioneer in energy, aka Tesla/Elon Musk, announced that 24,500 vehicles were delivered in Q3 up a whopping 70% from the prior quarter. Shares where higher but despite this news Wall Street is concerned about the company’s ability to ramp up Model 3 production while also integrating SolarCity into its structure. The gurus think that Elon will need to raise capital soon which could dilute the stock but today Mister Musk or “M-squared”, as we call him, tweeted to the world that Tesla has enough cash and does not need to raise capital this year although next year is another matter.
Speaking of Tweeter, it appears that all potential bidders for Twitter are now, in the words of our Shark Tank buddies… “out”, and will not bid on the ever-present yet apparently valueless company. This news is hitting Twitter hard and its shares are falling from the nest today. Since he is fond of using Twitter to announce company updates, maybe Elon Musk will emerge as a buyer. We could have a rule that says whoever sends the most tweets must buy the company. That means Twitter will be owned by either Elon Musk, Donald Trump or Kim Kardashian. No wonder we have such a love hate relationship with this company.
People ask me about what effect, if any, the ‘up-comin” will have on the economy and so far the only sector that has been affected is the healthcare space since both candidates are vowing big changes with the ACA. During the primary elections polls showed that small and mid-sized businesses favored both Trump’s and Clinton’s tax plans over everyone else’s tax policies. Goldman Sachs analyst Christian Mueller-Glissmann wrote in a recent Bloomberg article that even with current “political risks” Goldman pegs the downside risk on the S&P 500 at only 2% between now and the end of the year which is like……..nothing! While I could be wrong I think the election will have little effect on the economy.
Scouting went well this weekend. 30 kids frolicked in the woods building fires, rappelling off rocks and eating French fries which they made on a small stove. They unexpectedly got into the French fry thing and would not stop until they ran out of oil. At least it was a change from their obsession with pop tarts.