The Dow closed lower on Friday on light trading volume after a wild day in which a small rally was “bleached” when news from the FBI about a new development in the email scandal hit the wires. This is getting crazy. The Dow ended the day off 8 points at 18,161. For the week the Dow gained 0.13% or roughly 23 points. Techs were lower while energy and industrial related sectors were higher.
Amazon’s stock was blasted by over 5% after a hideous earnings report. The company missed earnings estimates by only growing profits 200% instead of the expected 350%. The nerve of those guys! Sure they invested heavily in technology, distribution, infrastructure and entertainment projects. Sure they increased sales by 29% and free cash flow by 49%. Sure they gave away free bananas! None of that matters to the gurus but hey, I’m not bitter. I recall during the dot.com bubble that when asked if his company would ever make money CEO Jeff Bezos replied “trust me”.
Initial estimates from the US Commerce Dept. showed the economy expanding at a better than expected clip of 2.9% in Q3. This is the best growth rate in 2 years and double the pace of growth in the second quarter. The jump was attributed to an increase in soybean exports and inventory rebuild efforts. Economist David Rosenberg pointed out however that the export boost was due to a bumper crop of soybeans which were sold to China. Rosenberg noted that without this one time item the growth rate would have been closer to 1.5% because consumer spending was off, residential investments fell by 6.2%, equipment purchases were lower by 2.7% and domestic purchases only grew by 1.4%. Inflation also remained tame at 1.6%.
Gold was up $6.40 at $1,275. Reason for the buying was attributed to the latest Clinton FBI probe.
Last night the scout troop had a court of honor in which we gave out over 150 merit badges, multiple rank advancements and three headlocks to some lunkheads who got a little frisky during the ceremony. All the food was consumed in a headlong rush that almost cost me an arm. A good time was had by all.