A rally on Tuesday, as expected followed Monday’s snowstorm. A market sell-off Wednesday, after the second snowstorm of the week in the NYC Metropolitan region, began early after the Automated Data Processing (ADP) payroll report fell 10,000 short of expectations but was met with a positive reaction to the ISM Services report. By the closing bell, the markets closed close to even.
Social Media Company News
After the market closed, a slew of social media / mobile application related stocks reported earnings. Twitter’s (TWTR) first earnings report as a public company proved to be disappointing as the company produced a larger loss than expected, user growth slowed and revenues fell short of expectations. The fledgling public company got the Bronx Cheer and lost about 18% after the report was issued. Pandora (P), the internet music service saw its shares slump 10% after releasing its own disappointing earnings report. The only winner of the bunch was Yelp (YELP) which reported a in-line bottom line on better revenues. At the same time Yelp raised guidance putting a bid into the stock resulting in a 7% after hours rise.
Legendary Investors Remain Bullish
A positive session on Tuesday and turnaround on Wednesday taken together with positive market commentary by legendary money managers Leon Cooperman of Omega and Lawrence Fink of Blackrock (BLK) on Bloomberg television indicate to me that perhaps the market is finding support at current levels. With traders back to work after the snow day and no news other than the weekly unemployment claims report, savvy shoppers may be ready to put some money back to work. However, there will be some degree of trepidation ahead of Friday’s Bureau of Labor Statistics jobs report for January.
Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long YELP — although positions can change at any time.
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