Your Monday Market Blip 6/8/20

Your Monday Market Blip 6/8/20

Stocks continued to rally with the Dow jumping 461 to 27,572. Trading volume was down from Friday’s session indicating that institutional buyers were quiet. Many gurus are totally flummoxed by the recent rally. Guru Stan Druckenmiller went on CNBC to say he was totally wrong and “humbled” by the recent market action. He said the Fed’s quick and comprehensive action was a difference maker that he had not counted on.
OPEC+ held a Saturday Zoom meeting and agreed to extend productions cuts for another month. The meeting marked a rare show of unity between members in attendance and energy stocks responded more positively to this than the actual cuts themselves. These production cuts are expected to resolve the current supply/demand imbalance and OPEC+ agreed to meet each month going forward to make adjustments as needed to the supply equation.
Thor Industries, maker of the iconic Airstream brand of trailers, reported better than expected numbers sending shares to a 52 week high. The covid shutdown and shifting attitudes over how best to travel have boosted RV sales. The gurus had expected Thor to report a drop in revenue of 43% and a loss of 40 cents per share but the actual results showed a revenue decline of 33% and a profit of 43 cents per share in what was a “better-than-feared” report. CEO Bob Martin said every RV dealer he has spoken with is excited about the pace of RV sales and the influx of first-time buyers which bodes well for the long term health of the industry.
Airline stocks rebounded hard last week and continued to rise today on rebounding demand for air travel. Shares of Alaska were up 10% at the opening while shares in other airlines were either up or holding steady. Gurus are worried that share prices may have jumped too far too fast. The rebound is also having a positive effect on shares of both Airbus and Boeing. Goldman Sachs figures that both of these manufacturers have cut production by 50% while delivery demand only fell 17%.