There will be a bundle of earnings reports that start to roll out this week. On Monday morning we had a few, but it’s about to get busy in the second half of July. Given how much is set to come out over the next few weeks, it was a relatively quiet day on Wall Street Monday. We saw an 0.17% gain in the Nasdaq today, followed by slight gains for the S&P 500 and Dow Jones .
That said, there’s a lot individual news to dig through.
Bitcoin, Libra and Crypto
The bitcoin market has been wildly volatile lately, hasn’t it? Bitcoin prices ran from $5,500 at the start of May to more than $8,700 by June 1st. Just a few weeks later it was north of $13,000.
It topped out around $13,600, before it promptly fell to just under $10,000. Crypto bulls said it was an opportunity. Bears argued it was a blowoff top and it was coming back down. Another run to $13,000 earlier this month was again met with sellers as bitcoin prices dropped back down to $10,000.
I’ll stop the onslaught of price history, but it’s sort of necessary for an asset like bitcoin. Put simply, this thing is volatile. Perhaps we’re entering a range-bound trade, between $10,000 and $13,000. At the very least, traders now have a few lines in the sand, where a move above resistance or below support could spell a further move in that direction.
The advances in bitcoin have helped give a boost to Facebook (NASDAQ: FB ) stock, even as it’s drawn the ire of regulators for its Libra cryptocurrency. Congress has asked Facebook to hold off on Libra until it knows more. It’s drawn comments from the president, while U.S. Treasury Secretary Steven Mnuchin said the Treasury has serious concerns over Libra.
For its part, Facebook – which will reportedly settle with the FTC for $5 billion – said it will wait until it has regulatory support before launching.
Heard at the Nasdaq Today
Shares of Gilead Sciences (NASDAQ: GILD ) were on the move Monday, rising 2.7% and closing at $68.07. It will invest $5.1 billion in Galapagos (NASDAQ: GLPG ), increasing its stake in the company from 12.2% to 22%. Galapagos will now see if shareholders approve an eventual stake increase to 29.9%. Given today’s action, it’s hard to see shareholders saying no, with GLPG stock rising more than 17% to new highs.
Further, Gilead Sciences stock was upgraded to outperform at Wells Fargo. The analysts assigned an $88 price target, implying about 30% upside from current levels and signaling new 52-week highs should GILD stock get there.
OK, so what’s going on with Broadcom (NASDAQ: AVGO ) and Symantec (NASDAQ: SYMC )?
Broadcom was reportedly in talks to acquire SYMC. However, on Monday, shares of Symantec abruptly tumbled lower, falling over 10% on news that AVGO is no longer in talks to buy the company. However, the stock recovered off its initial lows – and actually closed at session highs – while AVGO stock rallied almost 3% on the news, before ending higher by just 1%.
New reports say that Broadcom isn’t walking away from the deal just yet. So what gives?
This is just typical M&A drama. I don’t know if Broadcom will pull the trigger for SYMC. Maybe the latter wanted even more money. Perhaps the terms weren’t right. Either way, the market seems happy for AVGO to walk away, if that should be a sign of anything.
Broadcom stock has been under pressure since the buyout news surfaced and rallied when it looked like the deal was off.
Alphabet’s (NASDAQ: GOOGL , NASDAQ: GOOG ) Google, as well as several social media sites have fallen under criticism that they display a political bias. Google’s vice president of government affairs Karan Bhatia wrote an op-ed stating that the company does not have a bias and stated he will tell U.S. Senators that is the case as well.
Social media is playing an enormous role in the distribution of political news, both real and fake. It’s created a frenzy of both misinformation and information overload, drawing criticism from both political parties. No matter which side of the aisle readers stand on, they should be reading factually correct information, although tech companies haven’t seemed to find a very good way to govern it thus far.
Tesla (NASDAQ: TSLA ) stock is hitting its highest levels since May, rising 3.4% on Monday on above-average volume. The stock is now running into prior support though, which acted as resistance a few months ago. The stock has to reclaim this area to really get the bullish train moving.
Amazon’s (NASDAQ: AMZN ) much-awaited Prime Day is finally here, with sales going strong on Monday and Tuesday. The e-commerce retailer will pull in billions in revenue from the event and is drawing in competition from seemingly every online retailer (seriously, have you checked your inbox lately?)
Target (NYSE: TGT ), Costco (NASDAQ: COST ), Home Depot (NYSE: HD ) – three strong retailers by the way – have been hitting it hard, as has Walmart (NYSE: WMT ), Best Buy (NYSE: BBY ) and others. With a strong labor market, I would expect Amazon’s Prime Day numbers to be solid this year.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell . As of this writing, Bret Kenwell is long AVGO, GOOGL and AMZN.
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