Don't laugh at the headline, it's that serious -- earnings season is no damn joke. Miss a clue, and your portfolio is blown to pieces.
Here is the clue that should have piqued the interest of every single Johnny-come-lately bullish trader. JPMorgan Chase (JPM) just notched a pretty blowout third quarter and the first reaction in the stock is DOWN. Yes, DOWN! How could this be? Earnings smashed through estimates that were jacked up thanks to analysts positioning for the higher rate benefit. CEO Jamie Dimon dropped his usual optimistic comments on the state of the economy that will be strewn all over the web (accept on bitcoin sites, they hate Jamie Dimon). By line of business, there is no indication of a surprisingly weak U.S. economy. Trading and investment banking revenue were so-so, but loan growth in key consumer businesses was solid. Hell, I read the loan growth numbers as a reason to back up the truck on TJX Cos. (TJX) ahead of the holidays (especially as the stock has been oddly stagnant this year).
What the market may be saying, for now, is that it's fully valued. Hat tip, Jack Bogle. Investors expect a blowout third-quarter earnings season and are willing to take profits on strength. That is until Facebook (FB) comes out and beats by 30 cents in a few weeks and reignites the rally. Cheers, bro.
Alibaba Talking Some Smack
I suppose a person in my position is supposed to stay neutral and not have an opinion on anything. Good luck with that one. I like Alibaba (BABA) and am not afraid to say it. If the company has a bad quarter or does something off the mark, of course I will assess it accordingly. But you have to like the smack this company talks and its fighting spirit. The company wants to be a key global player in so many areas. The market thinks it will be, and there is no reason to believe why it can't eventually be mentioned in the same breath as Facebook, Alphabet (GOOGL) and others.
Case in point: The company's executives proclaimed Thursday that Alibaba it will soon become bigger than Amazon (AMZN) in the cloud. Considering Amazon's cloud business is no small potatoes, the feat would be an impressive one for Alibaba.
"We have taken on Amazon on all fronts as our benchmark over past three years. Some of our products have already exceeded theirs," senior vice president of Alibaba Group and president of Alibaba Cloud Simon Hu told the South China Morning Post on the sidelines of the Alibaba Computing Conference in the Chinese city of Hangzhou.
Another feat not talked about much: Alibaba briefly surpassed Amazon as world's most valued e-commerce company earlier this week.
It's Car Thursday
Here are two cars I am not so sure about. First up is the $155,000 BMW Alpina I recently tested (see video below). Lovely car, just not sure it's worth such a hefty price tag. Here is the full review.
The other "meh" ride is this General Motors-made (GM) mid-engine Corvette that was spotted out in the wild in testing (at a McDonald's no less). A mid-engine Corvette -- in effect turning the iconic American muscle car into a Lamborghini -- has been rumored for years. The whole car looks weird if you ask me. The Corvette is Americana -- big engine, in the front of the car. One shouldn't confuse a Corvette with a Lamborghini as it passes you doing 150 mph on the road.
On another front, Ferrari (RACE) has revealed it's raising prices in the U.K. by 7% in 2018. That has to be music to the ears of investors who have become obsessed with Ferrari's stock (see TheStreet's interview with Ferrari CEO Sergio Marchionne below).
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