Market 2018-01-16 (BIDU, MRK, GE, and more)

Down Jones reached 26,000 briefly before the whole market turned to bleeding mode. Government shutdown is due this Friday if no budget deal is reached. The deadline has extended twice. Meanwhile, the new round of earnings keeps coming as Citibank started this morning.

I believe the pullback will attract more fresh money into the market given the unbeaten sentiments. Here is an investment idea I wrote during the weekend "Investing in Artificial Intelligence".

Commodities: Crude -0.64% to $63.89. Gold +0.31% to $1,339.00. 

Cryptocurrency has a bloodbath today. Bitcoin, Ethereum, Litecoin and Ripple all fall off cliff. RIOT -16.5%, OSTK -11%, KODK -7.6%, SQ -4.7%....


Winners

BA -0.2%: Baird raised its PT to $433 from $380. Citibank also lifted its PT to $380 from $305, keeping a Buy rating. CAT -0.6%. These two were leading Dow Jones in the morning.

Citibank (C +0.4%), Q4 EPS of $1.28 beats by $0.09. Revenue of $17.26B (+1.5% Y/Y) beats by $40M. $3B charge to bring back cash to US and $19B charge due to tax reform. Citi is positioned well for the coming years.

Baidu +1.8%, China’s Chery Automobile Co. will use the ZF ProAI self-driving platform it developed with Baidu (NASDAQ:BIDU) and ZF Friedrichshafen.

Merck's (MRK +5.9%) gain is Bristol-Myers (BMY -4.7%) pain, as Merck announces positive results from a Phase 3 study of KEYTRUDA (pembrolizumab) in first-line non-squamous non-small lung cancer (NSCLC) ahead of competitor Opdivo (nivolumab).

GILD +1.6% to finish above $80. The price was around $74 when I published my analysis on 1/7/18 (link HERE), up >+8%.

REITs (IYR +0.3%) are doing fine today as treasuries recover a little. MAA +1%, O +0.4%.

AFL +1.7% recovers as the company responses further to the accusation last Friday.

Losers

Avis Budget (CAR -13.5%) dives. As SRS has disclosed a 30.7% economic interest in Avis Budget Group, the company approves a one-year stockholder rights plan to protect the interests of all stockholders. HTZ -14.9%.

GE -2.9%, plans to take a $6.2B Q4 after-tax charge related to its legacy reinsurance business, and add $15B to reserves over the next seven years. "GE has started down the road to breaking itself up," tweets CNBC's David Faber, noting the CEO's comments this morning on the investor call. "People close to the company tell me that outcome is likely with an announcement possible as soon as this Spring." Spin-off or selling non-core business may unlock the hidden value and squeeze the shorts.

 UAA -8.7%: Susquehanna claims possible 30% downside for Under Armour, brand remains at risk. Canaccord lowers its rating on UAA to Underperform from Neutral and assigns PT of $8. Nike -1.9%. Adidas aims to increase U.S. market share from 10% to 16-20%.

Top lithium stocks are weak in today's trade, as supply addition talks are coming from Toyota buying a stake in Orocobre and Chinese investment to increase capacity. (click HERE to find info about Invest in Lithium) LIT -2.1%, SQM -6.6%, ALB -4.1%, FMC -3%.

FRC -4.1%, reported Q4 EPS of $1.10 misses by $0.12. Revenue of $699.16M (+16.6% Y/Y) misses by $39.74M. I am glad I replaced FRC with C in my portfolio last week.

Mall stocks face profit-taking again: M -3.6%, JCP -4.8%, JWN -3.2%, TGT -2.4%, KSS -0.7%.

WSM -3%, got downgraded by GS to Neutral with $55 PT.

My Trades Today

Bought back MOMO @ $25.3 (sold around $27.6 a few days ago)

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