|
By Alex Eule
| Monday, October 18 Rewind. With
markets generally flat for most of the day, it was a good day to reassess a
few themes. We discovered that GameStop and
so-called meme stocks may not have been as disruptive a story as we
thought, cryptocurrencies are about to go mainstream, and department stores
are cool again. The
department store story is a funny tale about how investors assign value. This
morning, The Wall Street Journal reported that once beleaguered Saks
Fifth Avenue is planning an
initial public offering of its e-commerce business and hoping for a valuation
of somewhere
around $6 billion. E-commerce isn't exactly new, but the
number caught everyone by surprise. Less than two years ago, Saks was taken
private in a transaction that valued the entire company at $1.5 billion. That
was before the pandemic re-ordered the way we shop. The news
sent department stores flying, notably Macy's which closed up 17.5%. Macy's has been
facing recent calls to spin off its own e-commerce unit. The company declined
to comment to Barron's,
but today's rally could force its hand. At $28, Macy's shares are now
up 363% over the last 12 months. That has made the stock a big win for
day traders, but not so much for long-term shareholders. Back in 2015,
Macy's traded as high as $70. The
e-commerce excitement provided tailwinds across the consumer discretionary
sector, which was the best performing part of the S&P 500, rising 1.2% on
the day, boosted, in part, by Gap (+4.6%) and Target (+3.2%). Elsewhere,
it was another strong day for tech stocks. Apple rose 1.2% after announcing two new
MacBook computers that will be powered by the company's own
processing chips. My colleague Connor Smith highlights how Apple is increasingly
standing out for its chip-making prowess, complicating life
for onetime partner Intel. Shares of
Intel were flat on the day, even as the tech-heavy Nasdaq
Composite rose 0.2% After a
period of weakness, the Nasdaq is once again leading the way. It's up for
four consecutive sessions, rising 3.8% during that time. The index
is now just 2.3% off its September all-time high. The S&P
500 and Dow
Jones Industrial Average, which were mixed in
today's trading, are each about 1% off their record peaks. Tomorrow's
trading highlight could be Bitcoin, which is
about to get its very own exchange-traded fund. It's a big moment for the
volatile cryptocurrency, which could gain more widespread ownership through
the ETF structure. Barron's Avi Salzman calls it "the culmination of eight
years of failed attempts to wrap the volatile digital asset in Wall Street’s
favorite package." "Even
those who are skeptical about the products that are about to launch expect them
to draw billions of dollars in assets," Avi adds. There's an
important caveat, though. The ETF holders won't hold any actual Bitcoin.
The ETF is designed to track future contracts tied to Bitcoin trading. Read
Avi's story on why that distinction will be important
to remember. |
|
DJIA:
-0.10% to 35,258.61 The Hot
Stock: CDW +4.8% Best Sector:
Consumer Discretionary +1.2% |
No comments:
Post a Comment