Your Wednesday Market Blip 2/27/19

Your Wednesday Market Blip 2/27/19

The Dow opened lower but rallied before closing bell and posted a 72-point decline on heavier trading volume at 25,985. For the year, the Dow is up 11.7%. Some investors are concerned with the recent rapid rise in stocks but a trade deal with China and a strong US consumer could counter those fears. Only time will tell who is right but to me the US consumer is in good shape and consumption makes up 2/3’s of the US economy.

Lowe’s Home Improvement reported earnings and while sales were a bit soft due to a slowdown in the Canadian housing market net income beat expectations. Revenue was up 1% and profits gained 8%. The company is six months into a turnaround and appears to be making progress in closing the performance gap between it and Home Depot. The company said the spring selling season is shaping up well as the US consumer is in good shape with rising wages, low gasoline prices and plenty of jobs available.

“Bamboo Boeing”! Vietnam's Bamboo Airways and VietJet Aviation signed deals to buy 110 aircraft from Boeing worth more than $15B as the Vietnamese economy grew at a pace of 7.1%. I guess they got tired of flying old C-130’s ha ha. Earlier this month, the FAA said Vietnam has complied with international aviation standards and will now be allowed to fly to the United States for the first time in history.

After years of being in the toilet, Chesapeake Energy “aka Cheesecake Energy” reported better than expected numbers as the company is benefitting from higher natural gas prices, higher natural gas demand and cost controls. Revenue was up 22% and profits gained 57% before items. CEO Doug Lawler has had his nose to the grindstone for the last 5 years turning this ship around and now feels the company is ready to reward shareholders with improved cash flow and production in 2019. Cheesecake, which has the 2nd largest natural gas reserves in the US, used to be run by Aubrey McClendon who was part of the buyer group that snagged the Seattle Sonics and moved them to Oklahoma City. I wonder if Howard Schultz or Jeff Bezos would consider buying the company and moving it to Seattle?