Another pretty good looking consolidation day!
My big problem with today is that only oil kept the S&P and Dow above water. Remove those gains and you would pretty much have a negative of the same amount in each. Still it was a very strong finish and we will just have to wait and see what follow through we get tomorrow.
Nonetheless, up is up so we take it for today and my screens had a healthy mix, very much unlike the sickening sea of red we had Friday.
Just imagine how mad we’d be if we were long on oil and it hit $69 and XOM is still under $62… The whole oil patch just looks exhausted after it’s long climb, it is almost time to pounce!
Gold stocks also took a breather today as crazy gold went up and down $14 today. By the time it finished at $604 for the day most of the gold stocks just couldn’t believe it and remained near their day’s low. This may lead to a nice buying opportunity in the morning.
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Google had a heck of a rally as Comscore indicated they gained 6% market share in the last quarter (compared to their prior 57% share). That should translate to 6% more revenues (was $1.9Bn) so about $100M but we know they raised prices so probably more – and that’s pricing power!
Since it costs them virtually nothing to gain the additional revenue we could be looking at over $100M in additonal bottom line profits on top of last quarter’s $372M (which did also carry a high tax cost). If the Comscore numbers bear out – even if taxes are consistent and the other estimates for increased expenses are correct, we could be looking at a 25% increase in earnings to $2.20 a share.
I don’t think anyone, not analysts, not pumpers, not Cramer, not anyone – has even contemplated a 10% beat. This can send the stock into the stratosphere if those numbers play out. I did initiate a play on the May $500s for $2 in comments when it was weak today. They closed at $2.30 (up 15%) and I still like them if the momentum continues but there is no way I would hold these through earnings unless they were just the profits.
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Man, just this morning I said Alcoa would do well and they’re up 6% in the aftermarket on great earnings and prospects. That’s what I get for being nervous about the markets…
RIMM dropped another 2% today and the $75 puts moved to .95 (up 35%).
WAG ended up having a better day than RAD and the May $45s finished at .60 (up 5%) which wasn’t so bad in a mixed market.
DIS had an amazing morning and pulled back a little but I am very pleased with the $27.50s which ended at .55 (up 30%) but should have been sold for .60 on the pullback from .65!
SLB opened so high it had nowhere to go but down but the fact that it lost 2.5% post split is very telling (and not just that you should be very careful with splits).
AAPL was lame, lame, lame all day – losing 1.6%.
CME had a wild ride today, going all the way up to $495 then down to $475 before finishing right about where it started at $484.
Copper also hit another record today but PD just seemed bored by it. I think this makes them a day trade tomorrow!
BA picked up 1.5% and looked very nice but its trading buddies (TIE, ATI, BEAV, AIR) are way behind – also bears watching tomorrow.
The French government backed down and gave in to the protestors! I can’t even figure out how this is going to ripple but ripple it will!
Cramer is correctly pointing out that NOV should be higher and will be a good play if oil continues to be out of control.
Despite the huge climb in oil today, the sector made a fairly muted move and this is often a signal of topping but there is no way to bet against oil at this level. While VLO and the OGX weakened all day, XOM held flat and the price of oil just kept attacking $69 so there is no way we are going to commit money to this. I like the fact that BTU was flat as well.
