Pre-Holiday stock action: Nothing to see here, folks

Gadsden Flag, one of the predecessors to the Stars and Stripes. (Photo from an online sales catalog image)

WASHINGTON, July 3, 2017 – While the media had a weekend-long hissy fit over President Trump’s CNN-trashing WWE Smackdown parody .gif video, Wall Street ignored all the noise and hit the irrational exuberance button again, but on low volume.

The Dow closed up 129.64 points to stand at 21,479, after hitting another all-time high of 21,562.75 earlier in today’s holiday-shortened session, which closed at 1 p.m. Monday afternoon. Markets will be closed for Independence Day Tuesday.

The broader-based S&P closed up 5.60 to stand at 2,429.01, while the tech-heavy NASDAQ continued to suffer, losing 30.06 points on the day, off about a half of one percent.

In commodities markets, gold was down hard, silver a bit less so, while crude oil ratcheted up once again. Strange. We’ll have to puzzle this one out.

The June tech-battering, which continued into July at least through today doesn’t seem to be based on fundamentals per se. Instead, it seems to stem from a sense among funds and investors that tech stocks have gone too far, too fast. For that reason, it’s not very clear as to when many tech issues will find their respective bottoms.

Banks and some financials, which have lately been rallying hard due primarily to the most recent Federal Reserve stress tests, took a step back today, as did some stocks in the also bullish health sector. On a low-volume, pre-holiday shortened session like today, most stock moves are suspect. In some cases, moves on a day like today may be little more than head-fakes in one direction or the other.

Trading Diary

We trimmed a couple of our positions today for modest profits, including oil and gas equipment company Chart Industries (symbol: GTLS) which rallied hard today after well-received new that it made a surprise synergistic acquisition. Thinly traded Chart has performed miserably of late, likely dragged down due to diminished expectations in the energy industry.

Traders seem to have forgotten that Chart is involved mostly in the compression and refrigeration segments of that industry, and is particularly known for producing top quality components for the liquefied natural gas (LNG) sub-industry, a rapidly-growing part of the U.S. energy sector, given the mass quantities of nat-gas being discovered and extracted via fracking techniques here.

Whatever the case, today’s jump gave us a modest profit, so we took it, albeit reluctantly, as we think GTLS will eventually recover from its funk. On the other hand, like many others, we think the continuing market rally is getting a bit long of tooth.

Without some positive news on the healthcare and tax-reform agenda from 2017’s tedious, Republican-controlled Congress, which seems incapable of delivering on its promises, market expectations seem poised to retreat from a bullish stance until something positive and concrete is delivered by the Stupid Party.

The Evil Party, of course, won’t lift a finger in all this, lest Republicans get any credit for anything. But so it goes in our enlightened new century. Maybe a pen and a phone really are the way anything can get done in Washington these days. At least President Trump is having fun with that notion.

That means for now, we’re pretty much on our own, stock-wise. So we’ve continued to raise cash while making only occasional buys.

We did pick up a small number of shares in Micron Technology (MU). For a long time, this Idaho-based chipmaker was the worst of the worst, performance-wise. But after it acquired Fairchild Industries roughly a year ago, it MU seems to have caught fire, cranking profits to beat the band.

Oddly enough, when it reported blowout earnings after the bell on June 29, traders and investors quite unexpectedly dumped MU shares en masse, perhaps assuming that the company would never make a profit again. Despite the fact that management reiterated and even boosted its bullish forecast for the company’s next quarter, traders continued to unload significant quantities of the company’s shares again today.

So we jumped in and picked up a small position. Given our thus-far negative return on another chipmaker, On Technologies (ON), this buy may have seemed a bit impulsive. But we’ve been waiting for months for MU to back off a bit, so we bought some shares anyway. We’ll see how this one turns out.

Other than that, it’s time to ice the beer and get ready to celebrate the anniversary of our independence tomorrow, toasting the good old US of A and praying that after 8 gloomy years under this country’s first Socialist president, the country will turn itself around before it’s too late. But that chapter has yet to be written, so let’s celebrate what we still have as we wave the flag tomorrow.

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