Your Thursday Blip 2/11/21

Your Thursday Blip 2/11/21

It was another mixed day on Wall Street as the Dow fell 7 points to 31,430 while the NASDAQ gained 53 to 14,025. Trading volume was lower for the Dow and higher for the NASDAQ. Chip stocks were market leaders. BTS and IBD market indicators remain positive.
Shares of Seattle based online real-estate firm Zillow bolted 20% higher following an earnings report that beat guru estimates. The company posted a decline in sales of 16% but net income grew 258% on a adjusted basis. The company saw double digit gains in its Premier agent, IMT and mortgage segments offsetting a 50% drop in the house flipping operations. Forward guidance was positive and Wall Street liked what the company had to say.
The global semiconductor shortage is alive and well. Its beginnings came from the covid pandemic which sparked a surge in demand for PCs and other electronic devices while at the same time disrupting supply lines. Adding to the demand side of the equation is the electric vehicle revolution with car companies scrambling to keep up with Tesla. EVs use more chips than ICE cars. It is estimated that chip demand will increase 8.4% in 2021 which is well above the normal growth rate of 5.1%. Gaurav “G3” Gupta, semiconductor analyst at Gartner put things in perspective when he said that a missing 10 cent chip means you cannot sell a $30,000 car. Some in the US are calling for Uncle Sugar to lead an initiative and rebuild domestic chip foundries in an effort to satisfy demand while at the same time creating jobs.
This coming weekend is Presidents Day Holiday weekend. Markets will be closed on Monday. Over the weekend I am helping take the scout venture crew on a three day hike along the Washington coast to a place called Norwegian Memorial north of La Push. So far we have 10 kids signed up. The weather is expected to be cold, rainy and windy. It should be a fun adventure.