“Markets Dip, Morgan Stanley Buys E-Trade, & Stamps.com Jumps +65.5%”

The broad markets took a dip today across the board, except for the little guys on the Russell 2000 that moved higher by +.21% ending at 1,696.07 and getting near to its all-time high of 1,715.08. The S&P 500 closed at 3,373.23, -.38%,  the tech-heavy Nasdaq closed at 9,750.97, -.67% & the Dow Jones Industrial Average closed at 29,219.98, -.44%. The “fear gauge” Vix (TVIX) ended at $41.73/share jumping +6.32% as coronavirus fears seemed to surface again and it traded in $38.94 – $44.36 range.

The information technology sector also helped lead the markets dip, selling off -1% while the FAANG stocks experienced a red day. Facebook (FB) closed at $214.58/share, -1.34%, Alphabet (GOOG) closed at $1518.15/share, -.56%, Amazon (AMZN) closed at $2,153.10/share, -.79%, Apple (AAPL) closed $320.30/share, -1.03% & Netflix (NFLX) closed at $386/share, -.05%.

Surprising the market, financial services giant Morgan Stanley (MS), announced that they will be acquiring E*Trade Financial Corporation (ETFC) for $13 billion in stock. Shares of E*Trade closed up +21.81% at $54.73/share.

Shares of Stamps.com® (Nasdaq: STMP), the leading provider of postage online and shipping software, jumped up +65.5% today closing at $157.99/share after they announced results for the fourth quarter and fiscal year ended December 31, 2019. Ken McBride, Stamps.com’s Chairman, and CEO stated, “In 2019, we continued to make significant strides towards our goal of being the leading worldwide multi-carrier e-commerce software company. We continued to invest in our products and partnerships throughout 2019 to address the significant opportunities in the U.S. and internationally. We are very excited about our business prospects in 2020 and beyond.” See results.

Economic Reports

On Monday we did not receive any significant macroeconomic data as it was Presidents’ Day.

On Tuesday, we received the Empire State Manufacturing Survey for February moved up to 12.9. The NAHB Housing Market Index for February moved lower to 74.

On Wednesday, the Producer Price Index for January confirmed a move up by +.5% month/month and core PPI, which excludes food and energy, moved higher by +.5%. Building permits were confirmed to have moved up +9.2% month/month to 1.551M & were up 17.9% year/year. The weekly MBA Mortgage Applications Index dropped by -6.4%.

On Thursday, the initial claims report for the week ending February 15 showed a move higher by 4k to a 210k while continuing claims for the week ending February 8 moved higher by 25k to 1.726M. The Conference Board’s Leading Economic Index (LEI) report moved higher by +8% in January. The Philadelphia Fed Index report for February jumped to 36.7 ) from January’s mark of 17.

Investing & Inspiration

“The riskiest thing we can do is just maintain the status quo.
I get up at 4:30 in the morning, seven days a week, no matter where I am in the world.
I think it is important for people who are given leadership roles to assume that role immediately.
What I’ve really learned over time is that optimism is a very, very important part of leadership.” Bob Iger, Ceo of Disney

“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:

• Existing Home Sales for January