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What Next Wednesday – Markets Go Crazy to End the Quarter

Wheeeeeee, this is fun!  

Aside from our $2,750 winner on the Dow (/YM) Futures shorts from yesterday morning's Report, we also had a $7,000 per contract gain on the Nasdaq, which fell an amazing 350 points, from 6,850 to 6,500, paying $20 per point, per contract for our Members.  

Playing the Futures is not hard, you can join us today at 1pm (EST) for our weekly Live Trading Webinar and we'll be happy to show you how it's done.  It's really no different than any long or short position other than it's highly leveraged and it's playable almost 24 hours a day – so we can react to news any time it hits the wires. 

These were not particularly difficult calls to make (or to follow) as Monday Morning, in our Pre-Market Report, we predicted the market would bounce to the following lines:

  • Dow 24,350 (weak) and 24,550 (strong)
  • S&P 2,666 (weak and satanic) and 2,688 (strong) 
  • Nasdaq 6,850 (weak) and 6,950 (strong) 
  • Russell 1,565 (weak) and 1,580 (strong)

And then, on Tuesday morning, I said:

The markets are back up to our weak bounce lines(see yesterday's reportthough I think we'll be using them as shorting lines this morning as the Dollar is recovering quickly, up 0.6% and that's bound to put a bit of pressure on the markets as they finally hit some resistance.  Dow (/YM) 24,350 is my favorite short at the moment, with tight stops over the line and 6,850 on the Nasdaq (/NQ) will make a fun shorting line as well.    

Why short?  Well, nothing at all has changed other than it's POSSIBLE that China and the US will have a trade agreement instead of a trade war but, other than that – all the other stuff that caused the market to fall off it's highs all month haven't gone away – Thursday's trade talk just made them worse and now they are not worse – they are the same – not better either.  

Our 5% Rule™ is not Technical Analysis – it's just math.  It's math that determines the actions of the trade-bots that control the market and it's very, very good at predicting levels – because machines are very predictable.  The system is actually based primarily on Fundamental Analysis where I very tediously come up with a fair value for the major indexes and those then determine our primary ranges. 

For instance, on the Nasdaq (/NQ) Futures, our calulations in Friday (23rd) Morning's Report were as follows:

Nasdaq (/NQ) was 35% over it's Must Hold Level (5,400) that did not account for Amazon (AMZN) trading at 250 years worth of earnings along with other silly valuations like Netflix (NFLX), Tesla (TSLA) and AliBaba (BABA) but even FaceBook (FB) and Alphabet (GOOGL) had gotten ahead of themselves – which is why our main hedges are ultra-short Nasdaq ETFs (SQQQ).  Anyway, 7,290 was the 35% line and we actually topped out at 7,200, which is close enough to count it.  From there, back to the 25% line at 6,750 is a 540-point drop and we know the Nas loves the 25s so we'll use 100-point bounce lines to 6,850 (weak) and 6,950 (strong) but those don't matter because we're testing 6,700 at the moment and again, looking at the news flow – they are never gonna make it

That's what not making it looks like!  These are the same lines we've been using all year and there are similar ranges at the 30% line but it's the 20% line (6,480) that should concern us as that's the level the Nasdaq bounced off and that fall, from the 25% line at 6,750 is 270 points but we'll round it up to 6,500 and call them 50-point bounce lines (20% of the drop) to 6,550 (weak) and 6,600 (strong) for today.  

In the bigger picture, 6,850 is still the weak bounce line off the big drop from 7,200 and there's nothing bullish about the Nasdaq below that line and there's no way we're making that line today or tomorrow so, I can tell you now, we're heading into the weekend tilted bearish – no matter what the market does today and tomorrow.

The same Nasdaq Ultra-Short (SQQQ) hedge we gave you Friday Morning at net $400 that was up $950 (237%) on Monday and was back near $400 yesterday morning is now $2,550 for a net gain of $2,150 (537%) but it's still a $10,000 spread so another $7,450 to go from here if the Nasdaq heads lower.  We'll come up with some new hedges for the Webinar as well.

This morning we're testing that 6,550 line on /NQ  and, if that fails to hold, it's a good short play with tight stops above that line.  Usually, into the end of the quarter, we get some Window Dressing as funds try to pretty up their books but this Q is already a disaster and they would probably rather force a lower close on Thursday (Friday is a holiday) so they can get a better rebound in Q2 so I expect more downside from here.

Also, as I noted, nothing has fundamentally changed – the same concerns we had last week are still with us this week and there's not much the President can do to "fix things" this time – especially when it's very questionable whether or not he will still be President next year.

 


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  1. We are at the end of the month and quarter. What if any influence will this have on the price action over the next two days?


  2. Good morning, All!

    Join us for our LIVE webinar, today at 1pm!

    https://attendee.gotowebinar.com/register/8723568525421998338



  3. And we just gave these people another tax cut:

    http://ritholtz.com/2018/03/despite-time-highs-stock-home-prices-household-net-worth-except-top-10/

    It's insanity… 


  4. Good morning! 

    Another half-point move on the Dollar is keeping a lid on things – might not last.  I'd take short profits and wait for /NQ to fail 6,500 along with /ES 2,600 before being more bearish.  

    EOQ/Den – See above, usually they push it up but this time, I think down.

    Big Chart – We haven't added any red boxes so not that much damage has been done to the rally so far. 

    Net worth/StJ – When you break out the Top 1%, it gets really crazy.  They bring the 90-99 group up considerably.  


  5. Added back some GLD calls.


  6. ~~
    36

     

    TSLA

    Tesla (-4%) falls to 52-week low.

    The company will report Q1 deliveries and more importantly update Model 3 production over the weekend or early next week.


  7. Dxd/Phil- still queueing to close the 100 short calls? Was wondering if I should set an GTC order.


  8. FU GE!!!!!


  9. Anyone playing /RB long for the weekend?


  10. GME – Catching some bids.

    They report after the close today.


  11. FU OIH!!!!


  12. Oil up 1.6Mb, gaosline down 3.5Mb, Distillates down 2.1Mb.  That should help get them back to $65, much better than API indicated. 


  13. GLD/Albo – Crazy moves.

    Silver just can't get it going this year:

    DXD/Dave – No, that was 500 points ago.  If the Dow gets back now, it's going to be more on strength than a bounce we want to take advantage of.  

    /RB/Japar – Off that report I'd play long over $2.015.


  14. FU HMNY!!!!


  15. And more wheeee on TSLA! Can they hold $250 now?


  16. Look at TSLA finally go!  It's about time!  Die!


  17. Phil – Your short NFLX April 320 calls doing well today.


  18. Also, a nice reversal on SONC.


  19. TSLA/StJ – Damn, now I wish I did buy those expensive puts!  

    NFLX/Albo – Seemed obvious to me.  If the market wasn't so bullish, I'd have shorted the crap out of them and TSLA. 

    SONC/Albo – I didn't think earnings were bad, people freaked out at first.  

    Oh look, the Emperor has no clothes!  Who'd have thought? 

    I must be getting old – only takes the markets a year to catch up to my premises these days…

    Speaking of old – 55 tomorrow!

    Ticking away the moments that make up a dull day
    Fritter and waste the hours in an off-hand way
    Kicking around on a piece of ground in your home town
    Waiting for someone or something to show you the way

    Tired of lying in the sunshine staying home to watch the rain
    You are young and life is long and there is time to kill today
    And then one day you find ten years have got behind you
    No one told you when to run, you missed the starting gun

    And you run and you run to catch up with the sun but it's sinking
    Racing around to come up behind you again
    The sun is the same in a relative way, but you're older
    Shorter of breath and one day closer to death

    Every year is getting shorter, never seem to find the time
    Plans that either come to naught or half a page of scribbled lines
    Hanging on in quiet desperation is the English way
    The time is gone, the song is over, thought I'd something more to say



  20. MS offering 2 year FDIC insured CD rates right now. Remember CDs??? Haha. Good way to park cash that you don't want to commit to being short any time over the next 24 months. 


  21. I meant, 2.6% 2-year CD rates. 


  22. Phil .. admit it.  You are from the future.


  23. Oil rejected at $65, back to $64.  /RB rejected at $2.03, back where we started but no bets for me as I think the fundamentals are for lower but the holiday is too much of a wild-card.  

    • EIA Petroleum Inventories: Crude +1.6M barrels vs. -0.29M consensus, -2.6M last week.
    • Gasoline -3.5M vs. -1.95M consensus, -1.7M last week.
    • Distillates -2.1M barrels vs. -1.62M consensus, -2.0M last week.
    • Chesapeake Energy (CHK -3.9%will not sell assets without getting good value, even as it tries to fix its debt-burdened balance sheet, CEO Doug Lawler says at the Scotia Howard Weil energy conference in New Orleans.
    • “We’re not desperate to sell assets,” Lawler says. “We know we need to improve the balance sheet, but we don’t have to sell anything in the near term.”
    • CHK has been working to trim its current debt load of $9.97B, which is more than 3x its market valuation.

    Bonds/BDC – Getting harder and harder to ignore and you can't really have a more inept team handling the economy right when we head into treacherous waters.  

    CDs/BDC – That's where my kids' college money is.  I cashed them out in Dec and have been waiting for a good re-entry since.  Not tempted yet, still looking for 2,400 on /ES.  Maddie starts in May and has $260K so more than enough for 4 years so risking it would be stupid and Jackie has about the same (we started both when she was born with $100K) but 2 years from college so I can likely get her up to $300K if I time the re-entry right.

    Wow, this makes me want to buy a fast food place – huge advantage:

    • Google’s (GOOGGOOGL) traffic app Waze publicly launches Local ads, which exec Matt Phillips compares to digital billboards.
    • Kung Fu Tea participated in the test program and said, in three months, 5.5K drivers went to one of its locations due to the ads.
    • Big brands have long been able to buy Waze ads for a minimum of $850 per day. Local ads lower that cost to as little as $2/day charged on a cost-per-thousand impression basis.
    • Local ad types include “takeover ads” that appear on the top third of the screen when the user stops for over three seconds, branded pins that show up along the driving route, and promoted search ads.
    • Google purchased Waze for about $1B in 2013 and Waze has grown to 100M MAUs compared to the over 1B for Google Maps

    Amazon leads another big drop in tech

    • Attention for the moment has moved from Facebook (up 0.4% on the session) to Amazon (down 5.1%) as the commander-in-chief is reportedly far more concerned about bringing the House of Bezos to heel.
    • Also notable losers in the Nasdaq are Tesla, down another 8.5%, and Intel, down 3%.
    • The Nasdaq is lower by 1.4% vs. the S&P 500's 0.6% decline. The Dow is off 0.4%.
    • The retail sector is having a solid day if you take Amazon out of the equation. In particular, companies with a presence at malls and strip shopping centers are moving higher.
    • Notable gainers include Francesca's (FRAN +6%), Buckle (BKE +6.2%), Nordstrom (JWN+1.9%), Gap (GPS +2%), Ascena Retail (ASNA +2%), Express (EXPR +2.1%), Macy's (M+4.4%), Dillard's (DDS +2.8%), Kohl's (KSS +3.1%) and J.C. Penney (JCP +2.2%).
    • Retail beasts Target (TGT +2.8%) and Walmart (WMT +2.1%) are also outperforming.
    • Some of the retails ETFs are being held back a bit by their inclusion of Amazon as a holding.
    • Previously: Axios: Trump more concerned with Amazon than Facebook (March 28)
    • Previously: Amazon leads another big drop in tech (March 28)

    Selloff continues in biotechs, XBI down 2%

    • Biotechs continue to be under pressure in sympathy with the tech selloff. The SPDR S&P Biotech ETF (XBI -2.3%) is down albeit on lower-than-normal volume. Bargain hunters are, no doubt, loving the action. Buying has already perked up in certain stocks.
    • Selected tickers: (BIB -0.2%)(IHE +0.4%)(BMRN +0.3%)(CELG +2%)(GILD +0.9%)(AMGN-0.3%)(BIIB +1%)(VRTX -0.8%)(ALNY -3.6%)(IONS +0.1%)(INSY +2.1%)(CRSP -8.9%)(EDIT-7%)(NTLA -6%)(SGMO -12.1%)(AKAO -5.6%)(BGNE -1.6%)(ALKS -1.1%)(ALXN +0.3%)

    Sonic stakeholder looks for leadership change

    • A notable shareholder appears to be a little grumpy over the performance of Sonic (SONC+0.9%).
    • "We think a leadership change at Sonic is long overdue, and McDonalds is proof of what a dynamic leader can do in this industry in a short period of time," says Gullane Capital Partner's Trip Miller.
    • "As a shareholder of the company, we look for more guidance on the strategy to increase system wide sales and hope Sonic will opportunistically buy stock during the pullback tomorrow after a disappointing release," he adds.
    • Previously: Sonic beats by $0.01, misses on revenue (March 27)
    • Previously: Competitor discounting impacts Sonic (March 27)

  24. don't forget the market is closed Friday, all weeklies/quarterlies after Thursday's close.


  25. had to gamble that TSLA fills the gap a little short term. 275 calls. But over the next 18 months I think this is a 75-85 dollar stock.


  26. Phil, I have this position in ALB:

    S 10 2020 $100 puts at $15.10, now $20.35 

    B 10 2020 $110 calls at $20.60 now $11.10

    S 10 2020 $130 calls at $13.50, now $6.70

    What do you think a good adjustment would be?

    I am considering taking $265 loss and rolling to this position for $460 which widens my spread.  Just don't know about the math, it's so tedious.  

    B 10 2020 $95 calls (maybe add 5 contracts, cover later?)

    S 10 2020 $125 calls  

    Long /SB, /KC, /NGV, and /NGH  (These are slow and steady, compared to /RB, /CL, and indexes)  

    Thanks in advance, I am about an hour past my bedtime.  


  27. biodiesel…. I remember getting 18 percent CD rates and 13 percent tax free yields back in the old days (1980)


  28. sorry, I have 1 contract, NOT 10.   so still DD on the roll and leave uncovered and sell a call every 3 months.

    18% CD rates, Whoa…. do you ever think that will happen again?


  29. got  $7.65 for the WBA 2020 $65 puts 


  30. Waze / Phil – It does show you how much room Google still has to use all the data they collect! It's incredible and scary at the same time. 


  31. Future/Malsg – That's why I get my tenses mixed up sometimes.  cheeky  I'm just good at making connections (years of reading science fiction) and sometimes, things are so obvious to me, I can't believe they haven't happened yet.  That gets me in trouble sometimes so I strive to be patient. 

    Good bounce call BDC! 

    ALB/Grass – Well I don't see the short $100 puts as being an issue, not worth adjusting.  Otherwise, you paid $7.10 for the spread ($7,100) and you would cash out for $4.40 ($4,400) so carry a loss of $2,700 into the new spread.  Actually though, the $100 calls are $14 so just $2.90 ($2,900) to roll to those and, rather than buying back the $130s for such an outrageous price, you could sell 3 May $95 calls for $4 ($1,200) which pays back almost half the roll cost in just 2 months.  

    If ALB goes up (earnings early May), you simply roll the short calls to a higher strike in a longer month while your spread goes in the money and, if ALB goes down, you sell 3 more calls for another $1,000 and put tight stops on the first 3 (which would be lower).  You are selling just 50 of the 660 days you have in the spread so if you can collect $1,000 every 60 days, that's $10,000 back in your pocket while you wait to see if ALB gets back on track.

    Don't sit on the sidelines like an idiot cursing at stocks that don't perform well – put the positions to work making you money!  

    Those were the days Willsons.  Should have just put our life savings in 30-year notes that paid 15%! 

    One contract/Grass – Well that makes selling one against it risky but, as long as you are willing to DD on the longs if the short burns you, then it's fine.  

    Good price Den, especially after the earnings. 

    GOOGL/StJ – Unless some really strict regulations get passed, that data gives them so much leverage going forward. 

    Webinar time!


  32. STJ – You selling VXX Calls up here?  I shorted a couple yesterday and today.


  33. VXX / Palotay – Was just looking at that this morning. Of course, they are now 1/2 the price at which I sold my first batch so not as appealing but still worth a toss now.


  34. CBI -  From Briefing:

    ~~CBI Jul 15 puts (volume: 2050, open int: 970, implied vol: ~62%, prev day implied vol: 53%) — co is expected to report earnings early May (annual meeting scheduled for May 2 — will vote on McDermott M&A deal which is expected to close in Q2 of 2018).


  35. CAKE/Phil- still good to short the 45 puts Oct at @ $2.8? havent get to short cake for the July expiry.


  36. As an additional hedge, at the moment, I like for the STP:

    • Sell 4 WHR 2020 $125 puts for $12.50 ($5,000)
    • Buy 50 SQQQ May $16 calls for $3.90 ($19,500) 
    • Sell 50 SQQQ May $20 calls for $2.20 ($11,000) 

    That's net $3,500 on the $20,000 spread that's almost all in the money to start and the only way to lose is if the Nas goes up quite a bit from here which, with all these headwinds, doesn't seem too likely.

    This hedge also gives us a buffer to take profits on some of the Sept $15 calls if they spike higher and, if they don't, then the Sept $15/20 spread (80, half covered) can cover the 50 short May $20s and we take $19,500 off the table for a $16,000 instant gain (on cash) while the rest plays out.  


  37. LB/Phil – coming back to test 35? new entry opportunities?


  38. CAKE/Dave – I still like them a lot but not much upside from here.  They should settle in around $50 but that's fine for selling puts.  

    Indexes limping into the close.  Dollar 89.75.

    Added /SI long at $16.25 in the Webinar but it expires tomorrow so switching to /SIN8 (May) at $16.33.

    LB/Scott – They will easily clear $3/share in 2018 so $35 is a real bargain but not very bullish at the moment so I'm waiting to see a bottom before jumping on anything.  


  39. If 6,500 doesn't hold on /NQ, 6,350 is the next target.  


  40. looking at UTX or HON for possible armchair play, or just BTFD.


  41. Well, that wasn't a pretty finish.  Actually terrible coming off yesterday.

    Looks like we're consolidating to fail 2,600.  2,640 is the 20% line and 2,530 is the 15% line so 17.5% is 2,585, that's the next significant stop, which we bounced off on Friday but, since that was only a weak bounce off the bigger drop, I don't think it's going to be much support on the way to 2,530. 

     We tested 2,530 in Feb but very fast bounces off each time.  

    Remember, I think 2,420 (10% line) is the real fair value for /ES.  I don't think earnings are going to change my mind (they'll probably change everyone else's).  


  42. /SIN8 (May) ?/ Phil — for clarification on /SI, were you looking to go with May which is /SIK8 or July which is /SIN8?  I think July, but thought I would check with you


  43. Oops, it is July, not May.  Had May on my mind but, fortunately, pulled the trigger on July. 


  44. wilsons, I remember my mother saying at one point they had a home loan at 16%.

    people complain about being "owned by banks" at 3.5%. that was 357% ownership ago!


  45. I think that my first ever mortgage 30 years ago was around 9% or so and it felt normal then. Of course, we used to get more than 0.25% on our savings accounts then as well.


  46. Good morning!

    Looks like I was wrong, they are slamming us higher this morning.

    Dow up 100, Nas up 50 so far.  It's all a joke if we can't hit the bounce lines but no shorting (same as yesterday) if /NQ is over 6,500 and /ES is over 2,600 and both just crossed back over now.

    /NKD did have a nice dip as we expected but then made a spectacular recovery

    Dollar still hasn't topped 90.

    Europe is leading the recovery this morning:

    UK consumers turn more confident in March: GfK

    • GfK firm survey reveals Britain consumer confidence index at -7, hitting a 10-month high as wage increase outstrips cooling inflation, high levels of employment along with low-interest rates and action on Brexit deal.
    • The survey of 650 firms showed the balance of companies reporting a rise in output at +8 percent, down from +20 percent in the three months to February, but growth was expected to pick up in the second quarter, the CBI said.
    • The Bank of England said last week it expected heavy snowfall in February and March meant overall economic growth would a bit slower than it had previously forecast.
    • Argentina's central bank held its benchmark rate at 27.25% for the fourth consecutive time noting that high-frequency indicators suggested core inflation would remain high in March.
    • "The acceleration of inflation in recent months is transitory and is due to large increases in regulated prices and the rapid depreciation of the peso between December and February," the statement read.
    • The annual wage negotiations were resulting in salary increases consistent with the government's 2018 inflation target of 15%, and that its recent interventions in the foreign exchange market meant the peso was not expected to devalue further in the coming months.

    FTSE grants Saudis 'emerging market' status

    • Saudi Arabia has earned secondary emerging market status from FTSE Russell, a designation that will introduce more money to the country and help diversify its oil-dependent economy.
    • The Arab world's largest stock market, with a capitalization of about $500B, will join FTSE's secondary emerging market index (ETF: VWO) in several stages starting in March 2019.

    CME Group to buy NEX for £3.9B

    • Creating a cross-border trading powerhouse, U.S. exchange operator CME Group (NASDAQ:CME) has agreed to buy U.K.-based NEX Group (OTC:NEXGY) for about £3.9B.
    • The deal would be CME's largest since it bought Nymex for $11B in 2008, and mark the first time the same company owned the dominant markets for fixed income and foreign exchange futures, and their underlying securities.
    • Chesapeake Energy (CHK -3.9%will not sell assets without getting good value, even as it tries to fix its debt-burdened balance sheet, CEO Doug Lawler says at the Scotia Howard Weil energy conference in New Orleans.
    • “We’re not desperate to sell assets,” Lawler says. “We know we need to improve the balance sheet, but we don’t have to sell anything in the near term.”
    • CHK has been working to trim its current debt load of $9.97B, which is more than 3x its market valuation.
    • Gold mining stocks have lagged the precious metal itself over the past year, which is causing concern about bullion’s ability to keep rising, WSJ reports.
    • Gold is up 1.4% so far this year while the NYSE Arca Gold Miners Index has fallen 7%; gold mining stocks tend to be more volatile than gold itself but miners typically experience larger losses when the gold price is falling and overshoot when prices rally.
    • The current deviation from that trend is a worrying development for investors who are bullish on gold, as it suggests metal prices might not keep rising as interest rates increase, WSJ reports.
    • Another concern is that gold, a haven for investors during market turbulence, is struggling: April Comex gold fell 1.3% today to settle at $1,324.20/oz. for its lowest finish in a week.
    • Global potash producers Nutrien (NTR -2.5%) and Mosaic (MOS -2.8%) are lower after India's cabinet votes to slash subsidies for potash-based fertilizer by more than 10% for the next fiscal year beginning April 1.
    • India’s imports are estimated to have jumped more than 12% to 4.6M metric tons in the 2017-18 fiscal year, but could fall in the next year due to the lower subsidy, says an official with the country’s top potash importing firm.
    • Contracts signed by India and China are considered global benchmarks, and are closely watched by other potash buyers such as Malaysia and Indonesia.
    • A top Toyota (TM +0.9%) exec made some interesting comments at the New York International Auto Show on the autonomous vehicle technology race taking place in the industry.
    • "Some competitors, not by name because there are several, they’re trying to race to be the first one to show autonomous driving. I’m not so sure what being first gets you," said Toyota U.S. sales exec Jack Hollis.
    • Hollis made it clear that customer safety will be the top priority at Toyota with autonomous vehicles.
    • "What’s going to happen is, when Toyota brings it out, we are going to be fully confident that every customer who wants to get into it can be 100 percent confident," he promises.
    • Toyota has been more conservative than some auto peers in AV, even before the fatal Uber self-driving car crash.
    • Germany has agreed to offer car buyers subsidies for Tesla (NASDAQ:TSLA) vehicles again.
    • It had taken the cars off the list in December, citing the reason that customers could not order the Model S base version without extra features that pushed the car above the €60,000 price limit.
    • Tesla's stock is up 1.7% premarket after getting hammered in recent days on bond and Autopilot concerns.
    • Tesla (TSLA -7.2%) bondholders are getting burned even further following the credit downgrade by Moody's, notes Barron's Randall Forsyth.
    • The yield gap between Tesla's bonds issued last August and comparable Treasurys has widened to 481 bps from the original 320 bps spread. That puts holders at a double-digit principal loss if they need to liquidate today.
    • Forsyth thinks the bond issue made little sense for Tesla from the start, pointing out the inability for the company to deduct interest due to tax-loss carryforwards and the "sky-high" valuation on its stock (which could have been sold to raise funds).
    • In a separate article, Financial Times observes that Tesla is clear to use the Gigafactory to secure new financing. "If Tesla truly gets into trouble, bondholders may find the company mortgaging its battery factory to raise debt that ranks ahead of them," warns FT.

    • Boeing (NYSE:BA) says it was hit by a "limited intrusion of malware" that affected “a small number" of systems but remedies were applied and production was not affected, and says certain media reports on the disruptions were “overstated and inaccurate."
    • The Seattle Times reported Boeing was hit by the WannaCry computer virus this morning, prompting fears the attack could cripple vital airline production equipment, and that the company's chief engineer of commercial airplane operations sent out an "all hands on deck" memo warning that the virus was spreading rapidly and could hit systems handling aircraft software.
    • The assembly lines potentially affected by the software problem included those of Boeing’s 787 Dreamliner North Charleston, S.C., and the 777X Composite Wing Center, according to the report.
    • Casinos in Nevada reported that gaming win revenue increased 7.68% Y/Y in February to $1.018B.
    • Revenue on the Las Vegas Strip jumped 11.4% to $603.5M during the month.
    • Downtown LV casino revenue was up 2.8% during the month.
    • Total slots revenue increased 4.2% to $605.M during the month off a win percentage of 6.65%.
    • Games and tables revenue was up 13.27% to $412.3M off a win percentage of 13.57%. Baccarat revenue soared 80% to $177.3M.
    • Las Vegas bookies took in more than $10.7M during the month off a handle of 2.6%. The tally falls short by a wide margin last year's mark of more than $20M.
    • Nevada Gaming Control Board full report (.pdf)

    Walmart to reduce emissions in China

    • With President Xi Jinping vowing to slash pollution and prioritize living standards, Walmart (NYSE:WMT) has committed to cutting 50M metric tons of carbon emissions from its Chinese operations by 2030.
    • That's the equivalent of annual electricity consumption for 40M Chinese households.
    • The plan involves retrofitting factories with energy-efficient facilities and lighting, and working with suppliers to switch to renewable energy.
    • GameStop (NYSE:GME): Q4 EPS of $2.02 beats by $0.05.
    • Revenue of $3.5B (+14.8% Y/Y) beats by $230M.
    • Shares +4.1%.
    • GameStop (NYSE:GME) reports same-store sales increased 12.2% in Q4 to beat the consensus estimate for a 10.6% gain.
    • Hardware sales increased 45% during the quarter, while collectible sales were up 23%.
    • Gross margin was 29.3% of sales vs. 31.7% expected and 33.1% a year ago.
    • CEO update: "We have three core profitable businesses; Video Games, Collectibles, and Technology Brands. Moving forward over the next year, we plan to pause on investing in additional new businesses or acquisitions and focus on the fundamentals of improving the businesses that we already have. I believe focusing on the basics of retail operational excellence across the organization will maximize our free cash flow, improve our performance and, ultimately, deliver returns for our shareholders."
    • Looking ahead, the company expects to report FY19 revenue of $8.84B vs. $8.84B consensus and EPS of $3.45 vs. $3.45 consensus.

    AT&T judge: 'We have to move'

    • U.S. Judge Richard Leon is warning attorneys for the DOJ and AT&T (NYSE:T) to speed up the trial over its proposed merger with Time Warner (NYSE:TWX) or risk missing the June 21 deadline to complete the transaction.
    • The U.S. government opposes the $85B deal, arguing that it would hurt consumers because AT&T, which owns DirecTV, would have more leverage to raise prices by owning Time Warner's Turner networks.
    • Previously: Turner chief speaks on content rights at DOJ/AT&T trial (Mar. 28 2018)

    Samsung invests $7B in Chinese NAND fab

    Analyst says not to panic about potential Trump, Amazon "collision course"

    • GBH Insights analyst Daniel Ives says investors shouldn’t panic even if Amazon (NASDAQ:AMZN) is on a collision course with President Trump.
    • Ives, from a note titled "Trump and Amazon on a Collision Course? Worries Now an Overhang on the Stock": “While it’s now a hand holding time for Amazon given this new regulatory potential threat, we believe the reality of these worries altering the company’s business model and future tax structure are low and we would be buyers of the name on weakness.”
    • Ives notes that Trump has posted negative comments about Amazon on Twitter before, so the new reports aren’t surprising.
    • The analyst reiterates a “highly attractive” rating for Amazon and a $1,850 price target, a 24% upside to yesterday’s close.
    • Amazon shares are down 3.9%.
    • Previously: Axios: Trump more concerned with Amazon than Facebook (March 28)
    Great deal for local businesses!  Google's Waze launches lower-cost Local ads
    • Google’s (GOOGGOOGL) traffic app Waze publicly launches Local ads, which exec Matt Phillips compares to digital billboards.
    • Kung Fu Tea participated in the test program and said, in three months, 5.5K drivers went to one of its locations due to the ads.
    • Big brands have long been able to buy Waze ads for a minimum of $850 per day. Local ads lower that cost to as little as $2/day charged on a cost-per-thousand impression basis.
    • Local ad types include “takeover ads” that appear on the top third of the screen when the user stops for over three seconds, branded pins that show up along the driving route, and promoted search ads.
    • Google purchased Waze for about $1B in 2013 and Waze has grown to 100M MAUs compared to the over 1B for Google Maps