Hopefully, Mark Zuckerberg Won't Crash the Market
China's President Xi Jinping did his part to support the bull market in stocks via a conciliatory trade speech on Monday night, and now embattled Facebook (FB) - Get Report founder Mark Zuckerberg has to follow course. By now, seemingly ever pundit and journalist has weighed in how the camera-averse Zuckerberg will perform over the next two days in front of savage lawmakers. So there isn't much new to add until we watch him sit down and do battle. But one gets the sense that lawmakers won't have any clue what to truly ask Zuck in the attempt to send his stock price down the tubes again (because they would secretly love nothing better than to hit Zuck in his digital wallet, naturally). Sure, they may get under his notoriously thin skin, but investors worried about a full-on stock price rout should rest somewhat easy. The Facebooks evolution that is well underway, and which is being accelerated post the Cambridge Analytica debacle, will over time erode the company's highly lucrative business model. You probably won't see any evidence of the derision in the first-quarter results or perhaps even the rest of 2018. It's happening as we speak though, and should be something Zuck reflects in 2019 profit guidance (which should be issued) at some point later this year. In the meantime, enjoy the great theater and tread easily with Facebook's stock off the March mini-rally. Better trades into this spectacle if you haven't put them on already: big data business plays such as Dropbox (DBX) - Get Report , Salesforce (CRM) - Get Report , and Action Alerts PLUS holdings Microsoft (MSFT) - Get Report and Nvidia (NVDA) - Get Report .
Various Market Moves to Keep in Mind
(1) For you stock chart fans, Facebook's stock has found support at the March 27 intraday low at $150.75 (current price: $157.93); (2) Chip stocks on the move off a big new JPMorgan note titled: "The Data Era Becomes Investable." Nvidia and Seagate (STX) - Get Report likely to gt a boost off the report's upgrades on each. Positive mentions included Cisco (CSCO) - Get Report , Action Alerts PLUS holdings Alphabet (GOOGL) - Get Report and Amazon (AMZN) - Get Report , and Alibaba (BABA) - Get Report ; (3) M&A activity in the consumer space has been muted of late, but TheStreet's sister publication, The Deal, reported that is poised to change soon; (4) Billionaire Mark Cuban is no Trump fan, but he tells TheStreet he does dig Amazon CEO Jeff Bezos.
Come on, for real? Standard & Poor's has raised its corporate credit rating on dying Sears Holdings Corp. (SHLD) to CCC- from SD. S&P gave Sears a shout-out for its "demonstrated progress" on cost reductions and access to new liquidity (thank you majority shareholder, Eddie Lampert). The ratings agency did leave its outlook negative. The only thing that should be raised at Sears are the cranes to knock down all the properties that were once thriving stores. Those cranes could then help turn the properties into high-return assets, say Tesla (TSLA) - Get Report semi truck dealerships or Amazon Echo stores. Sears has not earned any form of upgrade, on anything, and it's financial position remains very precarious. The company's day of reckoning is fast-approaching and if you thought the Toys 'R' Us bankruptcy was big news, wait until you see the reports about Sears' final days.
Before You Go
Get ready for the must-attend investing conference of 2018, hosted by none other than TheStreet's Jim Cramer. From an exclusive interview with PayPal CEO Dan Schulman to expert panels that touch on investing in the stock market to alternative investing, you won't want to miss the event TheStreet is hosting on May 5. Details are below.
How to Diversify Your Portfolio: A Boot Camp for Investors
- Date: Saturday, May 5, 2018
- Location: 117 West 46th Street, New York City
- Register here