Flash Is Back!

Boy, I really wish I’d spent more time having lunch with Jeff Bezos at the Morgan Stanley employee cafeteria during the 1980’s.

Yesterday, he became the richest man in the world, thanks to the Friday 13.22% pop in Amazon’s (AMZN) share price that enriched him by an additional $10.5 billion.

Do you realize that $10.5 billion is MORE than 95% of the remaining billionaires in the country made during their entire lives?

Only in America.

Yes, flash is back!

Out with those boring banks, railroads, and steel companies that have lead the market since July.

Big tech delivered earnings reports for the ages, blowing out expectations in almost every case, including those for Amazon (AMZN), Microsoft (MSFT), Intel (INTC), and Alphabet (GOOG).

Their share prices movements are unfolding exactly as I expected, a multi-month “time” correction followed by another leg up to new highs.

This is why I haven’t been going short, like every other hedge fund manager out there.

We’ll know for sure how sustainable this tech melt up is when Facebook (FB ) and Apple (AAPL) report on Wednesday.

Will investors “look through” any disappointments caused by the iPhone X role out and keep chasing the shares higher? My bet is that they will.

Amazon (AMZN), a company that is supposed to be all about market share, delivered a shocking $0.52 a share, versus an expected $0.03. Q3 Revenues hit $43.74 billion, compared to an expected $42.14 billion.

The company thinks this number will rocket to $56-$60 billion in Q4, up 29%-38% YOY.

See what an effect my Christmas shopping can have?

Whole Foods chipped in an amazing $1.3 billion to the profit figure. They call it “whole paycheck” for a reason.

The entire Global Synchronized Recovery story is playing out in all its glory, with US Q3 GDP up a solid 3%.

Barclays Bank recently upgraded its forecast for Q2 global growth from 3.8% to 4.6%. It is clear that the best is yet to come.

In one fell swoop, US stocks have gone from looking expensive to looking cheap.

The new, improved outlook could take S&P 500 earnings from $131 this year to $145 in 2018.

Companies are now paying out 93% of their earnings as dividends or stock buybacks.

In one fell swoop, US stocks have gone from looking expensive to looking cheap.

Now, if they only had a tax cut.

Yes, I have been prodding, begging, and positively beseeching you to load up on stocks for years.

This is almost entirely due to China, Japan, and Europe buying more of our stuff.

Quantitative easing is finally working there, even though it was implemented five years late.

International trade rules!

New Home Sales broke records for a one month pop, up a blistering 19.8% in September. Home Depot (HD) shares noticed, another longtime favorite of mine.

And there is nothing like topping off another great week for the market than with another mega-merger, the $66 billion bid CVS (CVS) made for Aetna (AET).

The Volatility Index (VIX) is getting crushed AGAIN. I used the one mini pop we got on Monday to stop out of the small position I had been using as a hedge against many other “RISK ON” positions.

But even a miniscule 5% weighting cost me, taking a bite out of my October performance.

That leaves me up +1.12% so far this month, with a rare 100% cash position.

This week, it’s all about jobs, jobs, jobs, which should be hot, hot, hot.

On Monday, October 30 at 10:30 AM EST we get the Dallas Fed Manufacturing Survey, a poll of manufacturers in the Lone Star State.

On Tuesday, October 31 at 9:00 AM EST we get a new S&P CoreLogic Home Price Index, a look at the rate of appreciation in the 20 largest markets. I’m looking for an increase.

On Wednesday, November 1, at 8:15 AM EST we obtain the first of the big monthly jobs data with the October ADP Employment Report for private companies.

Thursday, November 2 at 7:30 AM we know the October Challenger Job Cuts Report, an indicator of corporate layoffs.

Then at 8:30 AM EST we learn the Weekly Jobless Claims, which could be anywhere, thanks to the twin hurricanes.

On Friday, November at 8:30 AM we receive the much awaited October Employment Situation Report, or Nonfarm Payroll from the Department of Labor

Print Friendly, PDF & Email

Author: Travis Esquivel

Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

Share This Post On

Submit a Comment

Your email address will not be published. Required fields are marked *