Your Tuesday Market Blip 7/24/18

Your Tuesday Market Blip 7/24/18

Stocks opened the day on the upside thanks to strong earnings reports but then halfway through the NASDAQ turned sour grapes while the Dow held firm. At the close the Dow was up 197 to 24,248 on heavy volume while the NASDAQ finished off one lousy point to 7,804 just below an all-time high. BTS indicators are still market positive and with the 10-year yield at 2.95%, Dan the Man at BTS noted that should interest rates move up to 3.25% or higher then some principle erosion in corporate paper could occur. Until then however things look good.

Shares of Google (aka Alphabet Soup) hit a new high after the company posted much better than expected earnings. “Googs” reported that revenue was up 26% to $37.1 billion while net income gained 19% to $3.19 billion. Both top and bottom line numbers beat estimates causing investors to jump on the stock like chickens on a banana slug. Paid clicks were higher than expected as companies like Domino’s Pizza and Target Stores sign on to Google web service.

Verizon reported better than expected earnings with a 5% revenue increase and a huge 25% increase in bottom line profits. Jennifer “Fresh” Fritzsche, analyst at Wells Fargo, noted that customers are purchasing higher priced wireless plans and increasing average connections per account.

Random Lengths reported its latest Framing Lumber Index reading and prices continued to fall over the past week declining from $532 to $515 making this the largest drop in over a year. Lumber prices spiked to unheard of levels in early June and have since declined. A year ago, the price index was $422. Several factors have combined to bring prices lower and these include a drop of housing starts and a sharp discount in futures compared to cash or spot prices leading buyers to hold off on needed items. Mills continue to tool up and modernize which will help alleviate production bottlenecks that had contributed to tight supply.