STTG Market Recap January 22, 2014

It was a generally quiet day in the market Wednesday, but we had some nice earnings fireworks in after hours today.   The S&P 500 added 0.06% and the NASDAQ 0.41%.   While the indexes were quiet there were a lot of interesting earnings moves.   Another light day for economic news worldwide.

Here are the longer term charts for the major indexes – you can see the S&P 500 has sort of stalled thus far in 2014 while technology and biotech has led the NASDAQ.  Please note if you are short term trading the NASDAQ is now at the top of its range that it has ping ponged in for over a year.



IBM (IBM) missed revenue expectations for a fourth straight quarter, and the stock sunk, dragging down the DJIA.   The company was hit by weakening demand, particularly in growth markets like China.


Coach (COH) the luxury handbag maker, also tumbled, stung by disappointing sales in North America.  The stock had made up a lot of losses incurred during the last earnings miss, but today’s drop pushed it back down to where it was 3 months ago.


The transport sector continues to be white hot – today railroad company Norfolk Southern (NSC) posted results the street liked, and the stock rallied sharply.


After the close two very popular names reported – Ebay (EBAY) and Netflix (NFLX).   The former is up 5% and the later 17% in the after hours session (not reflected on charts below).  Ebay saw Carl Icahn get involved:

EBay said that earnings and revenue grew in the last three months of 2013, driven by a strong holiday season for its e-commerce site and its fast-growing payments business, PayPal. The company also said it has received a notice from activist investor Carl Icahn seeking a spinoff of PayPal. But eBay said it has looked into that and does not believe it is best for shareholders.  Regarding Icahn, eBay said the billionaire investor also nominated two of his employees to the company’s board and now owns a stake of 0.82 percent in eBay.


As for Netflix, it was simply a case of good numbers:

Netflix reported higher profit for the fourth quarter as the company added 2.3 million customers to its TV and movie streaming service in the United States. The company on Wednesday reported net income of $48 million for the quarter, up from $8 million a year ago. Earnings-per-share were 79 cents.   The big surprise came when Netflix announced its estimated subscriber count will grow by 3.85 million in the first quarter of the year, with 2.25 million domestic additions and 1.6 million international.  In international markets, Netflix added 1.7 million members. It ended 2013 with more than 44 million customers worldwide.  Analysts had expected the company to report earnings excluding items of 66 cents a share on $1.17 billion in revenue.


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