After a holiday break Monday, U.S. investors came back to the same old same old grind higher. The DJIA was actually down today but it is only 30 companies so very stock specific. The S&P 500 added 0.28% and the NASDAQ 0.67%. There was no major economic news on the day so we’ll look at a lot of stock specific news today.
No changes here on the indexes folks, the NASDAQ continues to hover in the top half of its range as it has almost every day since mid October 2013. The S&P 500 remains above its support lines.
We’ll look at some individual names today using Marketsmith. A great place to start is these incredible biotechs which have been on a jaw dropping run for a long time now. We have mentioned this group over and over (and over) the past year+. We are highlighting two large cap names today – Biogen (BIIB) and Gilead (GILD), it is worth noting these are not small or mid cap names – these are companies with valuations in the tens of billions. There was no major news for either name today, they just have become a group very much in favor with momentum traders of all sizes.
Chemical company Dow Chemical (DOW) spiked today as a noted hedge fund took a major stake.
Dan Loeb’s Third Point Management on Tuesday disclosed a large stake in Dow Chemical and called on the company to consider selling its petrochemical operations. Loeb in his quarterly investor letter said Dow is Third Point’s largest current investment, but said the company’s shares have “woefully underperformed over the last decade” generating a return of 46% including dividends compared to a 199% return for the S&P 500 Chemicals index. The investor did not disclose the size of his stake, but he reportedly spent $1.3 billion amassing Dow shares.
Tesla Motors (TSLA) continued a recent breakout…
We’ll highlight a name you won’t see on most sites – Chinese online discount store Vipshop Holdings (VIPS); Forbes had a nice article on the company a few months ago. These type of names are volatile but the stock had an incredible 2013, and today broke out yet again.
Last is Blackberry (BBRY) which was left for dead a few months ago. Some positive news announcements have the stock up to its 200 day moving average – a place a broken stock will usually take a rest.
Shares of beleaguered phone maker BlackBerry jumped 8% on Tuesday and are now up 31% for the year as the company continues to draw fresh interest as a technology value play. Investors are gaining confidence in new CEO John Chen’s turn around plans, including slashing costs and focusing on selling services to large organizations rather than devices to individual consumers. The latest lift was assisted by the U.S. military. While other customers have defected in droves, the Pentagon said late last week that almost all of the phones and tablets connected to one of its new networks, 80,000 out of 82,000, were BlackBerries.