With North Korea sending markets southward, IDB had an article on the South Korean stock market as measured by the IShares S. Korea Cap ETF. This ETF is off about 6% from its high three weeks ago and while it gapped lower today it appears that investors are buying on the dip. The current price action in this ETF shows mild profit taking but no panic associated with rising tensions between N. Korea and the US. While this is good it should be remembered that caution is always prudent and that rising geopolitical tensions plus the winding down of Q2 earnings reports could inject more volatility into the markets. At the close the Dow was off 36 points on light trading volume at 22,048. IBD has markets listed in “rally mode” although chatter of higher risk and volatility is on the rise.
Shares of Disney were lower after earnings came in for the second quarter. Revenue was flat and missed estimates while net profits were off 2% but did manage to beat estimates. Disney saw continued strength at its theme parks but continued struggles at the ESPN sports network. It is Mickey Mouse versus Skip Bayless and right now Skip appears to have Mickey in a headlock. Disney also announced they were severing their distribution deal with Netflix and would instead start their own streaming service. Netflix responded by saying……”That’s a goofy move”!
Seattle online real-estate firm Zillow reported better than expected sales and profits but the news was not enough to make Wall Street happy sending shares lower. The gurus all said fundamentals remain strong and seemed to be scratching their heads over the selloff. Zillow did however mention the recent public stock offering of Redfin saying it could prove disruptive to the conventional method of buying and selling homes. While Zillow asserted it will not be affected by this disruption it did serve notice that Redfin is one to watch.
John will be taking over the blip while I am relaxing at Philmont Scout Ranch by herding lunkheads and wrestling bears.