The Week In Review

6/14/19

The major averages closed modestly lower, but off their lows for the day following weak economic data out of China and disappointing guidance from chipmaker, Broadcom.

Broadcom closed down 5% blamed geopolitical uncertainty and export restrictions on Huawei Technologies for the disappointing outlook, fueling worries that the industry has not bottomed yet. The Philadelphia Semiconductor Index dropped 2.5%.

Slower industrial output growth in China has also stirred lingering global growth concerns that have been reflected in the underperformance of the S&P 500 information technology (-0.9%), energy (-0.8%), and industrials (-0.6%) sectors. Losses have been kept in check, though, as the market anticipates China is likely to keep stimulating its economy.

The utilities (+0.8%), real estate (+0.4%), and communication services (+0.3%) sectors are the top performing sectors today.

On the IPO front, the online pet retailer, Chewy came public today jumping 50% from its IPO price. Chewy now sports a market cap of $14 billion while generating $3.5 billion in sales. PetSmart acquired Chewy in 2017 for a reported $3.35 billion and with remain a majority shareholder. PetSmart is looking pretty smart today.

For the week, the Dow and S&P 500 were both modestly higher up 0.6% while the Nasdaq gained 0.9%. The major averages are on pace to notch their second consecutive weekly gain.

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