Your Wednesday Market Blip 8/1/18

Your Wednesday Market Blip 8/1/18

Stocks traded mixed today with the Nasdaq gaining 35 points but the Dow losing 81 points to close at 25,333. While the markets continue to react to trade concerns, the Fed sees the U.S. economy “strong”. They recently voted unanimously to keeps interest rates where they are for now, but it’s expected that rates will get hiked in September and most likely again in December as a result of 4.1% GDP growth, wage increases, and unemployment at roughly 4%. Futures traders anticipate a 91% chance rates are hiked in September and a 68% chance rates are hiked in December.

The leaders of the strong economy have been Amazon and Apple as they race towards $1 trillion in market cap. The gap between them got a lot wider today, after Apple reported earnings yesterday afternoon and produced 17% revenue growth and 40% earnings growth. Apple is now sitting on $243 billion in cash, so we like their chances to win powerball should they go that route, but if not, they’re in good position to continue to be able to inject the $350 billion in the American econonmy as promised. Their stock traded up about 6% for the day and they now sit only $10B away from $1 trillion! Amazon will continue to be on the heals of Apple though, especially as their cloud services continue to grow. During Amazon’s earnings call they said that they are signing clients to longer contracts and currently have $16 billion in cloud contracts that are not yet recognized as revenue.

Tesla will be reporting earnings today at 2:30pm PST. I wonder if there are any futures traders taking bets on how many of the analysts’ questions Elon Musk will like?