Stocks were all over the place today like a politician on a pogo stick. The Dow started the day down 100 then went up 100 then fell into the close with a 210 point loss at 17,830. Trading volume was higher.
The US first quarter GDP number came out today with the Commerce Department reporting a 0.5% growth rate. This is down from 1.4% in the prior quarter and is the slowest reading in 2 years. Business investment fell 5.9% (thanks to weak oil prices) exports fell 2.6% and consumer outlays grew 1.9%. The markets however appear to be discounting the news and are already looking ahead to brighter days in the second quarter.
While Twitter reported uninspiring earnings causing the stock to hit an all-time low, Facebook reported better than expected numbers and shares jumped to all-time highs. The company posted a 52% revenue gain and an 83% increase in the bottom line. Ad revenues were strong with growth in the profitable mobile ad space segment leading the way. Amazon report earnings after the close.
Europe is a busy place these days. While Britain debates a “Brexit”, EU ministers now fear another round of pain from Greece as the Tsipris gubment is urgently calling for new talks while analysts voice concern that Greece is almost out of money and faces a 2.2 billion euro debt payment on July 22 which, at this point, it seems unable to pay. Meanwhile tensions between Greece and Turkey appear to be on the rise as Syrian refugee’s pressure the boarders and several military flights over sovereign airspace have recently occurred between the two countries.
Gold moved higher and looks to be starting a new up leg with a possible push to the $1,400 level. Today’s push higher came after the Bank of Japan announced it was not adding further stimulus for now and this surprise and shocking news caused the yen to move higher against the dollar. Gold, which is priced in US dollars, shot higher on the news. Some folks are saying that the run in gold is indicative of investors losing confidence in the ability of central banks to jump start growth. While this is far from certain it is far better than the general head scratching over gold’s recent rise. Gold closed up $19 an ounce to $1,269.