The markets felt negative pressure today from the further selloff of the mega caps as it digested a tempered and or a clipped alternative approach to monetary policy which was described by Fed Chair Jerome Powell. He seemed to be trying to revise the markets’ previous understanding regarding an interest rate cut at their next meeting in July. He pushed forward his understanding by emphasizing the central bank’s “independence”, by warning about how the Fed’s policy will not be submitting to “short-term political interests, ” & he pushed or reminded us the importance of policies that will “sustain the expansion.” Reportedly this “adjustment in position” comes in reaction to rhetoric and/or comments that President Trump has been expressing post the Fed’s decision to not lower rates at their recent meeting. However, you choose to slice it, the market has come away with a belief now that lowering interest rates may not in be in the cards for the Fed’s next meeting in July or maybe only a .25 basis points vs .50 basis points reduction that many assumed.In turn, the markets were down overall but mostly seen or led by the mega stocks. The S&P 500 dropped 27.97 points and closed at 2,917.38 down .95% on the day & seeing 10 of its eleven sectors drop. The Dow lost 179.32 points closing down .67% at 26, 548.22. The tech-heavy Nasdaq dropped a solid 1.51% closing at 7,884.72 down 120.98 points. The Russell 2000, the small-cap stock market index of the bottom 2,000 stocks in the Russell 3000 Index, moved down only .59% giving back 9.05 points Volatility increased today & closed higher today. The CBOE Volatility Index (VIX) closed higher at $16.28 jumping 6.68% or $1.02/share. It traded between $15.10 – $16.68. The 2x leverage ETF TVIX also closed higher at $20.30 up 4.53% and traded between $19.43 and $20.49 today. The US Dollar Index was down again today (4th day in a row) .2% ending the day at 96.00.
Big tech stocks were overall down today. Amazon (AMZN) lost 1.86% closing at 1,878.27, Alphabet (GOOG) lost a solid 2.61% closing at 1,086.35, Apple (AAPL) was down 1.52% closing at $195.57, Facebook (FB) gave back nearly 2 points off 1.95% closing at $188.84. Shares of Microsoft (MSFT) dropped an eye-popping 3.16% closing at $133.43 & Intel (INTC) fell 1.64% closing at $46.85/share. On the recent IPO front, Zoom Video Communications (ZM) moved sizably lower again by 4.90% closing at $85.03 & Uber Technologies (UBER), the ride-sharing company closed flat at $43.09/share but still below its recent IPO price of $45. Plant-based burger maker Beyond Meat (BYND) got back to its winning ways and closed at $150.60 soaring 6.82%. Their meat is made of four main ingredients: water, pea protein isolate, canola oil & refined coconut oil and is meant to taste like “meat. Slack Technologies (WORK) which jumped into the public markets with their IPO last week flying up 48.5% from their offering price of $26/share closed today at $35.20 off 1.57%. Slack is a provider of a cloud-based workplace messaging app and went public via a direct listing avoiding paying fees to the relevant banks. Entertainment giant Disney (DIS) closed at $139.94 gaining .52%. Institutional alternative asset manager Och-Ziff Capital Management Group (OZM) closed at $21.39 down 4.38%. The 52-wk range is $8.60 – $23. OZM sports a healthy 5.65% cash dividend.
The health care sector took another hit overall today after yesterday saw President Trump sign another executive order that is seeking to make health care costs more transparent to patients. The S&P 500 healthcare sector closed at 1075.31 off .41% but there were some bright spots. The was a mega M&A event where AbbVie (ABBV) surprised the markets when they announced they will acquire rival drugmaker Allergan (AGN) which closed up +25.36% at $162.43 for approximately $63 billion, or $188.24/share, in cash & stock. AbbVie shares lost 16.25% closing at $65.70/share. Community Health Systems, Inc. (CYH) one of the largest publicly traded hospital companies in the US hit an intraday high of $2.70/share & a low of $2.54 today and closed the day at $2.60 up 1.17% on 2.20, million shares of trading. More insider buying occurred recently as Michael Dinkins bought shares at $3.168/share on 5/28/19 according to the latest Form 4 filed at SEC.gov. Michael Dinkins has served on our Board of Directors since December 2017. Mr. Dinkins has served as president and chief executive officer of Dinkins Financial, a consulting firm that helps small businesses gain access to capital, since October 2017. See our story more details: INSIDER BUYING ALERT: Community Health Systems, Inc. (CYH) Director Michael Dinkins. The Ishares Nasdaq Biotechnology ETF (IBB) moved down slightly by .21% closing at $106.89. This sector has been on more than healthy run over the last 30 days. The 52-wk range is $89.01 – 122.97.
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