After-hours action hurts AMZN but the trading day is full of positives
Disappointing economic data prior to the market open soured the mood on the street as Jobless Claims rose unexpectedly to 454,000. Durable goods orders and the Chicago Fed Nat Activity Index put in disappointing figures. Throughout the day the volume run rate continued lower throughout the entire day. Stocks flucuated throughout the day as the Northeast tried to dig out from ANOTHER snow storm. The NASDAQ was helped out by NFLX earnings report as traders pushed the stock higher. But, it was MSFT reporting fifteen minutes shy of the close posting better than expecting numbers. The stock created a bit of turbulence into the close as traders awaited AMZN’s earnings. Another positive day for the market has battled back from last week’s selling.
AMZN disappointed the street with disappointing revenues and sub-par guidance. At last check the stock was down 10% as the company guided operating income at $260M – 385M when the street was expecting $474.4M. Fourth quarter revenue came in light at $12.95B when the street was expeting $13B. Earnings were better than expected, but revenues and guidance were too much for the street to overlook at this point in time. The fall in the stock will certainly provide some negative at tomorrow’s open.
Earnings season has certainly provided some drama as last week’s cloud burst to this week’s NFLX defying the odds set by short-sellers. Let the price and volume action guide you rather than pure emotion. This market has a knack to fool even the best and brightest. Monday’s turn around was the first part of this rebound. We definitely need to see this market push and hold above last week’s high soon and avoid any heavy volume selling. Tomorrow will be a test to see if we can overcome the selling pressure AMZN stock will bring on.
Two key levels on two indexes is Dow 12K and SPX 1300 were both rejected today. Both levels weren’t met with heavy selling, but both did fail to close above these pyschological levels. Over the next few days if we begin to see heavy volume reversals at these levels it will clue us in sellers simply have the advantage. At this point, it doesn’t appear to be a huge hurdle for this market to climb. Always be prepared!
