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Vista Partners’ Friday Weekly Market Wrap For January 10, 2020

By John F. Heerdink, Jr.

The broad markets moved higher this week as ongoing surface tensions eased between the US and the Middle East.  Technology stocks led the way as the S&P 500 information technology sector jumped +2.2% & the communication services sector rose +2.0%.

The FAANG stocks closed as follows on Friday:

  • Facebook (FB) $218.06/share, -.11% ($208.67/share a week ago)
  • Amazon (AMZN) $1883.16/share, -.94% ($1874.97/share a week ago)
  • Apple, Inc. (AAPL) closed at $310.33/share, +.23% after hitting a new all-time high of $312.67/share today ($297.43/share a week ago)
  • Netflix (NFLX) $329.05/share, -1.97%, ($325.90/share a week ago)
  • Alphabet (GOOG) $1429.73/share, +.70%, ($1360.66/share a week ago)


As a result, the S&P 500 ended the day at 3,265.35, representing a +.9% weekly increase and now up +1.1 % YTD. The Dow Jones Industrial Average ended at 28,910.18 representing a +1% weekly increase and now up +1% YTD. The Nasdaq Composite closed at 9,178.86 on Friday, realizing a weekly +1.8% advance and up 2.3% YTD. The Russell 2000 moved lower by -.44% at the close of trading Friday at 1657.64 representing a weekly -.2% decline leaving it down -.6% YTD. The “fear gauge” Vix (TVIX) ended at $44.5/share down -1.02% today & down from $51.88/share last Friday’s close.

Economic Reports

We did not receive any significant economic data Monday.

On Tuesday, the ISM Non-Manufacturing Index Report for December confirmed a 55% reading (an increase) while the Factory Orders Report showed a decrease by -.7% month/month in November as Shipments rose +.3%. The trade deficit tightened to $43.1B in November.

On Wednesday, The ADP Employment Change Report confirmed that ~202k positions were added to private-sector payrolls in December.  The Consumer credit report also rose by $12.5B in November.

On Thursday, the initial jobless claims report for the week ending January 4 showed a move down by 9k to 214k while continuing claims for the week ending December 28 rose by 75k to 1.803M.

On Friday, the December nonfarm payrolls report confirmed a rise increased by 145k while private sector payrolls increased by 139k & the unemployment rate came in at 3.5%. Average hourly earnings moved higher by +.1%. Wholesale inventories went down by -.1% month/month in November while wholesale sales jumped +1.5%.

Investing & Inspiration

“Greed is all right, by the way. I think greed is healthy. You can be greedy and still feel good about yourself.”-Ivan Boesky

Michael Marcus taught me one other thing that is absolutely critical: You have to be willing to make mistakes regularly; there is nothing wrong with it. Michael taught me about making your best judgment, being wrong, making your next best judgment, being wrong, making your third best judgment, and then doubling your money.” -Bruce Kovner

“The policy of being too cautious is the greatest risk of all.” -Jawaharlal Nehru

“I talk about macro themes a lot because they are fun to talk about, but it is the risk management that is the most important thing. The risk control is all bottom-up. I structured the business right from the get-go so that we would have lots of diversification.” -Michael Platt

Tomorrow

The earnings season kicks off during the coming week as US banks due to report their Q4 results while Tuesday brings forth the inflation report and the U.S./China “phase one” trade deal is supposed on or around Wed., Jan. 15th. On Thursday the retail sales report should surface and then the industrial production report on Friday.

The 38th annual JPMorgan conference will be in SF next week and I will be meeting with approx. 40 CEOs of biotech and medtech companies.  I will be also attending a Tribe Public Keynote Speaker Luncheon Event in San Francisco to hear from CEO Dietrich Stephan Ph.D., a brilliant geneticist, of Pittsburg-based Neubase Therapeutics (NASDAQ: NBSE) during the JPMorgan Annual Health Care Conference Week. NeuBase is developing the next generation of gene silencing therapies with its flexible, highly specific synthetic antisense oligonucleotides. Their proprietary NeuBase peptide-nucleic acid (PNA) antisense oligonucleotide (PATrOL™) platform allows for the rapid development of targeted drugs, increasing the treatment opportunities for the hundreds of millions of people affected by rare genetic diseases, including those that can only be treated through accessing of secondary RNA structures. Using PATrOL technology, NeuBase aims to first tackle rare, genetic neurological disorders. NeuBase recently won The Scientist’s Top 10 Innovations of 2019 Award for its Janus Base Technology and has picked BUY recommendations with a $14/target price recently from Oppenheimer, BTIG, and HC Wainright.

 

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