“Hump Day Brings Positive Economic Data & Reduced Fears To Stock Market” – Vista Partners Daily Market Recap For Feb. 5, 2020

Wednesday’s trading session brought forth more good feelings and positive moves across the board today. These upwards moves seemed to be fueled by mostly positive economic reports and reduced fears surrounding the coronavirus situation as beliefs of a possibility of containment and a remedy are believed to be on the horizon. The economic reports included the following: the ISM Non-Manufacturing Index Report for January clocked in a 55.5% reading in December, the Trade Balance report for December confirmed growth in the deficit to $48.9B, the ADP Employment Change report confirmed an estimated 291k jobs were created to private-sector payrolls in January & the weekly MBA Mortgage Applications Index rose 5%.

With the added fuel the Nasdaq charged forward yet again to a new record high closing at 9,508.68, +.43%. The S&P 500 also jumped to a new record high closing at 3,334.69, +1.13% as 10 of the 11 sectors (real estate, -.1%) were in the green. The Russell 2000 moved higher by +1.52% ending at 1,681.92.  However,  the Dow Jones Industrial Average had the best day closing at 29,290.85, +.1.68%.

Tesla (TSLA) which had been leaping forward daily recently put on its electric car brakes today as it closed at $734.70, -17.18%.

The FAANG stocks had a mixed/flat day. Facebook (FB) closed at $210.11/share, +.13%. Alphabet (GOOG) closed at $1448.23/share, +.08% after it reported mixed results after the market closed this week. Amazon (AMZN) closed at $2,039.87/share, -.48%.  Apple (AAPL) closed at $321.45/share, +.82%. Netflix (NFLX) closed at $369.67/share, +.18%.

The “fear gauge” Vix (TVIX) ended at $43.36/share pulling back by -8.02% and traded in $43.30 – $46.48.

Economic Reports

On Monday we received the ISM Manufacturing Index report for January which moved up to 50.9% & back into the expansion mode level. However total construction spending went down by -.2% month/month in December while residential spending moved higher bu +1.4% month/month & nonresidential spending lowered by -1.2% month/month.

On Tuesday, we received The Factory Orders Report which confirmed a rise of +1.8% month/month in December.

On Wednesday the ISM Non-Manufacturing Index Report for January clocked in a 55.5% reading in December. The Trade Balance report for December confirmed growth in the deficit to $48.9B. The ADP Employment Change report confirmed an estimated 291k jobs were created to private-sector payrolls in January. The weekly MBA Mortgage Applications Index rose 5%.

Investing & Inspiration

“There are old traders and there are bold traders, but there are very few old, bold traders.”-Ed Seykota

“Let this scenario play out on its own, in its own fashion. As you watch it unfold, you will soon be grateful that you choose the peaceful path. Remember — those who live by the sword, die by the sword.”

“As long as you enjoy investing, you’ll be willing to do the homework and stay in the game.” -Jim Cramer

“I rarely think the market is right. I believe non-dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it.” -Mark Cuban

“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

“The only true test of whether a stock is “cheap” or “high” is not its current price in relation to some former price, no matter how accustomed we may have become to that former price, but whether the company’s fundamentals are significantly more or less favorable than the current financial-community appraisal of that stock.” -Philip Fisher

“I learned to avoid trying to catch up or double up to recoup losses. I also learned that a certain amount of loss will affect your judgment, so you have to put some time between that loss and the next trade.” -Richard Dennis

“The four most dangerous words in investing are: ‘this time it’s different.” -Sir John Templeton

“Money doesn’t make you happy. I now have $50 million but I was just as happy when I had $48 million.” -Arnold Schwarzenegger

Tomorrow

Tomorrow’s significant economic data report schedule will include the following:

• The weekly Initial & Continuing Claims Report
• The preliminary Q4 readings for Productivity &
• The Unit Labor Costs