“Excellent Pressure” Vista Partners Daily Market Recap 5/9/19

By John Heerdink LinkedIn

U.S. equities dropped again on Thursday as the China trade saga applied a significant amount of worry, concern and downward pressure on the markets as many fled to “safety.” President trump offered that he had an “excellent alternative” to a trade deal with China but it is was made certain that he was referring to tariffs that we all know about. hmmm…. The good news, we hope,  is that Trump stated he received a “letter” from President Xi and that he believed that he would give him a call later. This is supposedly a good sign that the anticipated dinner between VP Liu He & USTR Lighthizer would take place tonight. The swordplay continues for now.

All indices dropped again today for the fourth straifght session. The S&P 500 dropped .30% today which is still above the 50-day MA of 2860 as it ended at 2870.72. The Dow ended down a solid .54% while the Nasdaq slid .41% & the Russell 2000  did its part and pulled back .3%.

Another healthy dose of volatility hit us too as the CBOE Volatility Index (VIX) dropped to $19.10 or down 1.55% realizing the daily range of $18.87 – $23.38. The 2x leverage ETF TVIX closed at $27.17 up .11% and traded between $26.90 and $31.86 today.

Dow 30 components Caterpillar (CAT) dropped 1.29% and Walmart (WMT) dropped .23%.

Out of the energy sector, Chevron (CVX) jumped 3.1% as it passed on countering on the Anadarko Petroleum (APC). Exxon (XOM) nicked down up .09% closing at $76.77.

In the tech sector, Intel (INTC) dropped a healthy 5.32% closing at $46.24/share as it got downgraded by BMO. Microsoft (MSFT) which was down .01%. Apple (AAPL) sold off 1.07% & IBM dropped .76%.

Yesterday Disney (DIS) reported Q1 earnings after the close and beat analyst expectations posting earnings of $1.61 share on revenue of $14.92 billion expectations were $1.57 and $14.54 Billion respectively. However, DIS closed at $133.59 down 1.40% today.

One of the largest publicly traded hospital companies in the US and a leading operator of acute care hospitals in communities across the country, Community Health Systems, Inc (CYH) hit an intraday high of $3.51/share & a low of $3.33 today after closing at closed the day at $3.46/share yesterday. CYH proceeded to close at $3.48 up .58%. Not as big of a  wild ride today as the seemingly approximate 10% swings that we have been experiencing lately.  I wonder if it will come on back down to the $3.14 level again or if this $3.33 level is the new higher low?

Also, we issued an insider buying alert on CYH earlier this week as an SEC Form 4 was filed Tuesday, May 7, 2019, as Community Health Systems (NYSE: CYH) Chairman & CEO Wayne T. Smith bought 323,084 shares of CYH stock on Friday, May 3rd. The stock was bought at an average price of $3.32 per share, for a total of $1,072,638.88. See the complete filing at the SEC.Gov website: https://www.sec.gov/Archives/edgar/data/1018660/000120919119028031/xslF345X03/doc4.xml However, there is a now a  new SEC for 4 filing that shows that he has now bought more CYH stock at $3.468/share and bringing total purchases over this period that is worth north of $3mm.

It is worth noting that CYH Management is continuing to push forward with their strategy to delever their balance sheet & sell off underperforming hospitals assets in order to improve cash flow. They seem to be making progress in these efforts, although early, evidenced by their recently published financial and operating results for the three months ended March 31, 2019.

INVO Bioscience (IVOB), a medical device company which was granted FDA clearance for the first intravaginal Culture System, INVOcell a simplified and cost-effective treatment for patients diagnosed with infertility rose 2.94% today.

It was another quiet day for Seattle-based biotech firm, Atossa Genetics (ATOS) whose shares closed down 5.32% at $2.67 per share. Shares in the aftermarket are currently showing up 5.24% at $2.81.

Oil prices dropped .6%  & closed at $61.73/bbl.

The US Dollar Index closed at 97.42 losing .2% today.

After the market closed this afternoon, the ride-sharing company Uber (UBER) priced its IPO at $45 per share which is below the $48-$55 range that was thought to be accurate. Uber has raised a whopping $8.1 billion via the IPO which places its value out of the gate at approximately $82 billion. It will be interesting to see how it trades in this market when it opens in Friday’s trading. Maybe the lower pricing will allow for it to end up in its first day of trading unlike their rivals Lyft (LYFT) that recently pushed its price up above the targeted IPO range and then the stock fell.

Vista Partners LLC (”Vista”) is a California Registered Investment Advisor based in San Francisco. Vista delivers timely and relevant insights via the website: www.vistapglobal.com with daily stories, weekly market updates, monthly macroeconomic newsletters, podcasts, & Vista’s proprietary equity and market research to help you stay informed and stay competitive. Vista’s mission is to invest partner capital while arming investors with a comprehensive global financial perspective across all market sectors. Vista also seeks to provide select issuers with actionable advice regarding fundamental development, corporate governance, and capital market directives.

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