Technology stocks ‘tripped’ a bit going into Quarter’s end; emphasized by Facebook’s acknowledgement of yet another large data privacy breach (details of which were not fully disclosed). That hit FANG+ stocks which as usual recovered ‘somewhat’, but not fully. It’s really a gradual distribution.
We think the overall market still continues to focus less on interest rates; less on Oil prices (rising as noted likely all the way since t40’s/bbl area but helping the Senior Indexes hold up); and a lot on ‘trade & tariff’ issues, with the outcome of the Midterm Elections being very pertinent to how lots of firms will assess their CapEx and other plans for the year or two ahead.
Market stability is taking place at high levels, which contributes to jitters, as well as realization that ‘even if’ the market gets good news on trade, or for that matter meanders through the Midterms without any dramatic ‘waves’, it still leaves the market extended with limited areas of attractive valuation.
As to the market it remains heavy but not plunging; however again Oil has contributed to an illusion of Index stability the Averages don’t deserve.
This weekend, since the overall market backdrop as we view it is known; I would like to touch on several FANG or other well-watched other stocks. I’ll make just a few comments, and include a few charts related to techs too.
Bits & Bytes: starts with Facebook (FB); which is less of a technical alarm than media suggests; because consumers (unless they are advertisers) do not provide credit card or very private information to Facebook. However, this did impact over 50 million accounts; and is just another issue to address.
It’s been my view that FB shares were appropriate for large partial sales, earlier in 2018, about the time Peter Thiel (Zuckerberg’s first private holder incidentally, and eBay co-founder) liquidated around 70% of his shares. It should be noted that every since the dramatic July breakaway decline, FB never reestablished technical strength. Stocks rarely do after such shifts; or at least not for a long time or absent some fundamental developments. In this case look for Instagram to be more closely embedded, but FB really is a fairly mature stock with no particular investment attraction (for now).
