Stocks started the day with a strong upside move but then lost steam heading into the close. The Dow ended up 72 at 26,149 on lighter volume. For the month of January the Dow was up about 5.6%. Interest rates were left unchanged by the Federal Reserve but they hinted that inflation pressures are rising.
Healthcare stocks are pulling back thanks to the double hit from the “Bezos, Buffett, Dimon” news and last night’s State of the Onion speech in which the President talked of lowering the cost of drugs. While this might make some investors nervous the thing to remember is that healthcare is backed by a powerful demographic trend plus it will take time for proposals to come forth, be wrestled over and finally (if at all) implemented. Then there is always the possibility of making it cheaper to produce drugs which could be a win win for both producers and consumers. Stay tuned.
Chinese based Jinko Solar has announced plans to build a $410 million solar plant in Florida in an effort to avoid the recently established 30% tariff on imported solar panels. The new plant is expected to employ 800 workers. While there is concern that tariffs will increase the cost and slow the installation of solar in the US the other side of the coin shows that tariffs can support both domestic solar production and R&D.
Shares of Boeing are the new Amazon. Boeing reported earnings that smashed estimates as the company is executing well and jets are rolling off the line like hot dogs at a ball game. After reporting a 9% revenue increase and a jump in profits of 94% the company added frosting to the cake with strong forward guidance. A 13% increase in airplane deliveries is generating more cash than the gurus had expected. Shares shot to an all-time high.