For Trading March 12th
BA CRASHES MARKET
TRAVEL BUSINESSES COLLAPSE
Yields Improve
Today’s market was pounded from the start with the futures overnight falling on the lack of the president showing up after he said he would be appearing and the fact that there were no specifics of his “plan” to address the issues. After trading down all morning to -1067 around 11:45 rates started to firm and we had a rally back to -787, but then rates slipped and we headed to 1665 before a close -1464.94 (5.86%), NASDAQ -382.20 (4.7%), S&P 500 -140.86 (4.89%), the Russell -86.60 (6.41%) and the DJ Transports -394.75 (4.63%). Clearly, the biggest drag on the market was BA -284 DP’s, one of the reasons that the DJIA was a bigger percentage leader on the downside. Market internals were weak with the NYSE 18:1 and the NASDAQ 7.1:1 negative. All of the DJIA stocks were lower with only 2 NOT down in double digits. Between the declaration that the WHO put out calling the COVID-19 a “World-wide Pandemic,” and the banning of spectators at sports events in Washington State and bans on events in San Francisco of over 1000 people, things only got worse when BA declared that it was taking down a $13.8 billion line of credit and a hiring freeze. Since the close, the NCAA has said that March Madness games will also be played without spectators. Even the late- night TV shows are stopping live audiences by this weekend. The one thing that I feel I have to stress here is that this IS NOT A FINANCIAL CRISIS, IT IS A HEALTH CRISIS. While that does little to take the sting out of a 20% decline, it is not a bank (or banks) failure. I know it doesn’t help, but it is the fact. And frankly, the panic is overdone.
Our “open forum” on Discord, which allows me to interact with subscribers and others to allow direct questions and chart opinions on just about any stock, continues to grow with more participants every day. It is informative and allows me to share insights as the market is open and moving. The link is: https://discord.gg/ATvC7YZ and I will be there and active from before the open and all day. It’s a great place to share ideas and gain some insights.
SECTORS: Other names in the news: It was a debacle of a day for the same names as for the last 2 weeks with airlines, cruises, booking companies, and finally BA, the biggest aircraft manufacturer in the world falling. In the airlines we had JBLU -1.01 (6.93%), UAL – 3.22 (6.13%), LUV -307 (6.74%) and DAL -2.80 (6.16%). The cruise lines continued with all down dramatically, but none as bad as NCLH today -5.47 (26.7%), CCL -2.27 (9.45%), and RCL -7.30 (14.13%). The bookers followed with BKNG -116.50 (7.47%) and EXPE –9.26 (10.7%).
As mentioned, BA gets a double (or maybe triple) shot with their 737MAX troubles, yesterday’s issue with wiring bundles, the airlines canceling orders and the fact that they drew on a massive $13.8billion line of credit today. The stock, the leader on the upside moving from $102 in 2016 to a peak of $446 last March has fallen back to 2017 levels, closing $189.08 -73.25 this week and -41.93 (18.15%) today.
BIOPHARMA: was LOWER with none down less than 2.7% and BIIB -11.38, ABBV -2.53, REGN -10.32, ISRG -27.85, MYL -.58, TEVA -.35, VRTX -8.06, BHC -.61, INCY -2.41, ICPT -8.42 (9.29%), LABU -7.07 (18.72%) and IBB $107.70 -4.61 (4.10%).
CANNABIS: stocks were LOWER again with TLRY -.69, CGC -.71, CRON -.03, GWPH -6.49, ACB -.09, PYX -.32, NBEV- .18, CURLF -.22 and the only winner KERN, maker of compliance software, 5.76 +.86 (17.55%) and MJ $11.34 -.80 (6.59%).
DEFENSE: was SHARLY LOWER with -10.24, RTN -14.12, GD -6.85, TXT -3.85 (11.29%), UTX -11.71 (9.81%), NOC -17.04, BWXT -.34, TDY -15.98, and ITA $116.77 -16.54 (9.02%).
RETAIL was LOWER with the brands only slightly better on the day. M-.79, JWN -3.08 (11.36%), KSS -2.96, DDS -4.04, JCP -.068 (12.11%), WMT -4.81, TGT -2.75, TJX -2.36, RL -8.24, UAA -.37, LULU -10.38, TPR -1.59, CPRI -2.04 (9.97%), NKE -4.30 (4.87%) on Adidas earnings and guidance, and XRT $34.97 -2.70 (7.17%).
FAANG and Big Cap: were LOWER with GOOGL -54.17, AMZN -57.62, AAPL -7.65, FB -6.64, NFLX -11.64, NVDA -12.39, IBM -5.51, TSLA –2.33, BABA -6.88, BIDU 2.51, BA (see above), CAT -5.80, DIS -5.27, and XLK $84.10 -3.54 (4.04%)
FINANCIALS were LOWER with the market and a visit with the president didn’t seem to help. GS -10.10, JMP -3.93, BAC -.81, MS -2.30, MS -2.30, C -4.26, PNC -6.10, AIG -2.64, TRV -5.77, AXP -6.85 and XLF $23.00 -1.15 (4.76%).
OIL, $3432.98 -1.38 The stocks were LOWER with the price of Oil trying to rally and making it to $36.35 before turning back down and closing near the lows. I’m still stand aside this market since it has a lot of work to do to rebuild a base to define the risk. XLE finished $34.25 -1.30 (3.66%).
METALS, GOLD: $1,642 -13.80. After the rebound, and the overnight move to $1,704.30 we sold off as liquidation hit even the yellow metal. We finished nearer the low, and we continued lower today.
BITCOIN: closed $7,855 -140. We broke to the downside overnight and fell to a low of $7,640, which closed a gap left on the breakout back in January. While I want to add the 350 sold just over a week ago, I want to wait and see some stabilization. We still own 400 GBTC with an average of $8.06. GBTC closed $8.64 -62 today.
Tomorrow is another day.
CAM
