Equities start the day higher as Fruit buys Beats (which just so happens to push tech M&A to its highest level since 2000). So at this point there are multiple Stanford and Harvard grads who DON’T work for Apple yet a guy who sang “187 on an undercover cop” is in one of the best corporate pictures I’ve seen in a long time. Since the merits / challenges of this deal will be argued ad naseum by people way smarter than me I want to use this space to celebrate the entrepreneurial spirit of America. Dr Dre, by all rights, faced an impossible future. He didn’t have rich parents to push him into lacrosse so he could get into an Ivy League school and work for Goldman. He grew up in a place where you could die crossing the street, where hardship claims endless dreams. You have to give him credit for what he created and where he ended up. He is now part of arguably the world’s most valuable brand and will go down as one of the most successful business men ever. Dr Dre, I congratulate you and your fellow entrepreneurs (including Iovine and the rest), you took what life gave you and made lemonade. Ok, enough of that, let’s talk markets.
After the first hour of meaningless up and down movement we settled into a 1 pt range for most of the day. A painful reminder that volatility is nowhere to be found. Speaking of nowhere to be found, the second revision of GDP showed no growth whatsoever. In fact today’s release actually showed negative growth (-1.0% vs expectations of -0.5%)due to…you guessed it…weather! All the hot shot economists still blame mother nature so who am I to argue, I’ll just hide in their PhD shadows. Luckily for us markets don’t care about the past, only the future, and what I’m hearing from people is “wait until the massive catch-up in the next few quarters”. HSH continues to be embroiled in the world’s biggest food fight as TSN showed up to the table offering $50/shr if they promise to make nuggets that don’t taste like wet paper after you microwave them (I hate microwaving nuggets, it’s an affront to civilized eating). Other winners were PXD, BIIB, ISRG, NFLX, and MCK. Not much worth skewing on the losing side, KORS fell 4%, XYL fell 3% and FTR fell 2%. I really need a nice blowup where the CEO tells Wall St “hey, this is hard stuff, you come give it a shot pal”. How refreshing would that be? I’d definitely buy the stock the next day. Anyway by lunch we sat on 1,914, up 0.25%. Does anyone else think Quantum Leap should be rebooted? That TV show was awesome and would certainly hold up today with new actors / plots. I might move to Hollywood and pitch it.
The final hour saw fresh all-time highs and a close at 1,920, up 0.50%. I thought yesterdays “digestion” looked pretty good and my instincts were correct. It all comes down to the fact that once you break a sideways trend you force people to act, and that’s exactly what’s going on here. That being said, we are starting to reach overbought in a few sectors so we’ll need further consolidation before another solid move higher. But in the end I think we do go higher, primarily because so many people are now worried about being left behind. Is this bull market ever going to end? Yes. When? Your guess is as good as mine but I don’t think anytime soon. Final Score: Dow +39bps, S&P500 +54bps, Nasdaq +54bps, Rus2k +30bps.
Nothing great today, just a bunch of Beats/AAPL headlines, so let’s move to the big finish.
Tonight we are going to look at another music icon, Fifty Cent, throw a first pitch in Mets stadium. For comparison purposes we are going to look at a blind kid doing the exact same thing.
Oh and a bonus link for you. I put a friendly wager on this match and was wondering if you could help me settle something. Was it fixed?
Have a good night.