Diamonds and Dogs

12/10/18

Defense stocks look good. In a down market, the defense stocks are in the green on reports President Trump wants to boost the 2020 defense budget to $750 billion. Lockheed Martin (LMT) is up 3%, Raytheon (RTN) is up 2% and General Dynamic (GD) is up 1.5%. In the tech space, Facebook (FB) is up 2% after the company added $9 billion to their $15 billion share buyback plan. The buyback accounts for 6% of their outstanding shares.

 FedEx (FDX) stock heading in the wrong direction. With the holiday season upon us, FedEx is firing on all cylinders except for the stock price, down 4% today and down 30% from the January highs. On Friday, FedEx changed leadership at its Express division, its largest unit, which generates more than half of their total revenue. A Merrill Lynch analyst downgraded the stock this morning saying the change in leadership was surprising and could signal a reduction or delay in its profit-improvement targets. FedEx will report earnings next week.