The Dow sold off thanks to Boeing, baby powder and reports of slowing growth in China. China’s GDP growth rate came in at 6% which is the slowest reading in 26 years. Meanwhile Johnson & Johnson is a major Dow component and its shares took a hit when the Feds released a study showing that a “sub-trace” amount of asbestos was found in a single bottle of baby powder. So, 0.00002% of chrysotile asbestos was found in a 16 oz bottle causing a 5% decline in JNJ stock which is a loss of $17 billion in market value. Talk about a multiplier affect!
At the close the Dow was off 255 at 26,770. Trading volume was higher. For the Week the Dow was off about 0.17% as today’s action erased gains from early in the week.
The transportation sector got a boost from positive earnings from railroad company Kansas City Southern or KSU. The company reported revenue and profits above estimates sending the stock to an all-time high. Revenue was up 7% and net income gained 24%. KSU runs rail lines in the US, Mexico and Panama and the strong earnings were attributed mostly to petroleum shipments in Mexico. KSU saw big gains in Chemicals, Petroleum, agriculture, industrial and consumer products. Intermodal was up slightly while auto Shipments and energy were lower.
Geek Wire online magazine had an interesting article about Seattle’s growing ecosystem of technology startups. They said the trends point to robust growth in AI and all things tech thanks to VC funding, research efforts at the University of Washington and the success of tech startups in the region along with established local companies like Boeing, Microsoft and Starbucks. The numbers are staggering with over 130 engineering centers now in the region and over 19,000 job openings for engineers of all types from Apple to SpaceX. See it on our Faceplant page for a copy of the article which points to a bright future for the economy of the region.