The only fly in the ointment in Tuesday’s market was the disappointing September Durable Goods Orders (ex-transportation) which declined 0.2% versus expectation of an increase of 0.5%. However, this metric is very unreliable and quite volatile. The only real damage from Durable Goods Orders was a temporary dip in pre-opening index futures, which was quickly recouped by the time the market opened.
Alibaba (BABA) and Apple (AAPL) both continued their ascent to new highs as reports circulated that the two companies may be interested in some sort of collaboration. Buffalo Wild Wings (BWLD) surged 13% after Monday’s earnings release while Panera Bread (PNRA) slipped after hours on Tuesday due to a lowering of forward guidance. That company’s earnings call will take place this morning.
Social Networking in Profit Taking Mode
Facebook (FB) reported a solid quarter but informed the street that it would ramp up expenses in the future. This was the excuse that traders needed to take profits in the social network. It also followed Twitter’s (TWTR) earnings related decline. This leads me to believe that LinkedIn (LNKD) could be setting up for a sell-off after that company’s earnings release on Thursday.
Today’s most interesting earnings release comes from Polo Ralph Lauren (RL). The fashion retailer has struggled this year. The question I have is this due to an aging brand or is it the difficult retail environment around the globe?
Shell Midstream Partners Begins Trading
Shell Midstream Partners, LP (SHLX), a master limited partnership )MLP) priced its 40 million share IPO at $23 last evening. This pricing was way above the expected range of $19-$21. I doubt that I was able to get IPO shares for clients as the deal was quite oversubscribed. I am going to try to buy some stock for income oriented accounts today, if the price is reasonable. I would suggest kicking the tires on this MLP.
Other than all that, recall that today the FOMC will complete its two day meeting and I will conduct my weekly chat from 1 – 2 PM.
Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL, BABA, BWLD, & FB— although positions can change at any time.
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