Your Tuesday Market Blip 2/26/19

Your Tuesday Market Blip 2/26/19

Stocks pulled back a bit with the Dow falling 33 points on light trading volume to close at 26,058. BTS and IBD indicators are green so its smooth sailing for now.

A federal appeals court on Tuesday cleared AT&T’s takeover of Time Warner, rejecting the Trump administration’s claims that the $81 billion deal will harm consumers and reduce competition in the pay TV market. Shares of Ma Bell were higher on the news and the decision might clear the way for more merger activity in the space. Comcast reacted to the news by jumping back into the competition for 21st Century Fox’s movie and TV business which Disney is currently trying to snag.

Home Depot reported Q4 earnings and they were solid with a revenue gain of 11% and an increase in net profits of 33%. The company raised its dividend by 32% and increased the share buyback program. While same store sales growth was below estimates at 3.7% CEO Craig “Miter” Menear attributed the lower number to bad weather and the gubment shutdown. Jim “Mad Money” Cramer noted that Home Depot’s best quarter is usually in the spring and that a weak winter earnings report can be meaningless. Lumber prices meanwhile are up this year with the Random Lengths Framing number index has moved from $325 to $377. Last year at this time the index was at $509.

The latest Housing starts report showed a bigger decline than expected with starts falling 11% or the worst reading in two years. The report was delayed due to the gubment shutdown and economists, while not liking the results, are giving it pause because it is inconsistent with strength seen in jobs, wages and the purchasing manager index. Only time will tell if this report is bad or just a blip.