Your Wednesday Market Blip 4/10/19

Your Wednesday Market Blip 4/10/19

Stocks continue to trade in mixed fashion, but market leadership has clearly shifted to the NASDAQ which is heavy to tech, chip and software companies. These are benefitting from things like 5G, electric cars, data centers and AI. This rally could be called the “5GEVAI” rally. At the close the Dow was up 6 points to 26,156 on higher volume. During the day the Dow had been off near triple digits. Economic gurus are starting to raise Q1 GDP growth estimates. At the beginning of the year they expected growth to be flat but now are calling for growth in a range of 1.5% to 2%.

After yesterday’s “Europe trade war” headlines, trade talks with China are making progress. An agreement has apparently been made in regard to an enforcement agreement to handle disputes. Both sides are taking this issue seriously and having an agreement in this regard is a mark of progress.

Misery loves company. Shares of Boeing continued to trade lower as short sellers have now taken positions against Boeing and are starting to trash the company on the internet in their efforts to make a buck. “Kit” Carson Block over at Muddy Waters is one of them and he posted a message saying the company was liable for “negligent homicide” and that CEO Muilenberg’s Mom wears army boots. . In addition to these folks, class action lawyers are filing suits to get money back for shareholders who experienced a loss when shares fell from $446 to the current level at $366. Boeing reported that in Q1 it delivered 149 commercial aircraft down from 184 in Q1 last year. Analysts are starting to downgrade the stock citing a slowdown in deliveries which will affect cash flow. How this balances out against defense contracts and service revenue is unknown but should be revealed when the company reports earnings on April 24th.

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