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We continue to see dip buyers very active – while this was a down week it was a needed respite after last week’s holiday action pushed indexes to very overbought conditions. The S&P 500 gained 0.15% and the NASDAQ 0.44% after both being in the red this morning. Likewise a key name like Wells Fargo (WFC) which reported this morning sold off on its report but dip buyers came in during the day to minimize losses. This continues to be action that favors the bulls. The “Portugal issue” which arose yesterday seemed to abate as Portugal’s government and central bank offered assurances that the southern European nation’s financial system was sound.
Indexes continue to be A-ok.
Wells Fargo & Co, the fourth-largest U.S. bank, reported a 39 percent drop in mortgage revenue for the second quarter as lending volume dropped, underscoring the urgency for the bank to find other sources of income growth. The bank managed to boost earnings and meet analyst estimates through gains from investments in stocks and bonds among other areas. But that income could be difficult to repeat in coming quarters, analysts said.
Consolidation continues across many sectors – there are very few major tobacco companies but Reynolds America and Lorillard (LO) confirmed merger talks.
Silver and gold are acting quite well after a long period of being “meh”. Both are trying to break out of bull flags.
Meanwhile oil continues to fall back sharply.
Per SentimenTrader this sign of “bubble-ness”:
In a sign of semi-froth, shares of Cynk Technologies joined a group of only 5 other companies listed in the United States that have a market capitalization of more than $3 billion despite no revenue. It seems to have no business operations whatsoever, yet shares continue to climb. We should expect an investigation and likely charges of some sort within weeks. While likely not the first time, we can’t find another instance of a company with no apparent business achieve a market cap of multiple billions.
Here is the chart of this company – wacko action!
We’ll have a lot of key earnings reports especially of very well known companies in the next 2 weeks to stay tuned, and we’ll see you back here Monday!