TVIX Stock – DealBook Briefing: Tronc Nears Deal to Sell Los Angeles Times
The stock market’s slide over the past week has given investors plenty of anxiety.
Stocks have lost roughly $4 trillion in value. The Dow Jones industrial average and the S.&P. 500 endured their worst point declines in their histories Monday and their largest percentage drops since 2011. C.B.O.E. Volatility Index surged more than 100 percent Monday, the biggest increase in its history.
But there are reasons investors shouldn’t get too concerned.
1) Heading into the final hour of trading, the markets have rebounded strongly. The Dow has jumped 2 percent, while the S&P 500 and the Nasdaq Composite are up 1.6 percent and 1.9 percent. That suggests that worst of the sell-off may be passed.
2) The outlook for economic growth is strong in the United States. The American economy grew 2.6 percent in the fourth quarter and the Atlanta Fed’s GDPNow tracker forecasts a 4 percent rise in the first quarter.
3) Corporate America’s bottom line is growing. With 50 percent of the companies in the S.&P. 500 having reported results, profits are on pace to grow 13.4 percent, according to FactSet. If that growth rate holds through the end of earnings, it would mark the third quarter in the past four that S.&P. 500 companies have reported a double-digit profits increase.
4) The sell-off comes after a big run-up in stocks. Until Monday, the Dow and the S.&P. 500 hadn’t endured a pullback of 5 percent in more than 400 sessions. Since 1929, a 5 percent decline happens every 92 days on average, according to Goldman Sachs. So stocks were arguably due for a selloff. But it should be noted that after Monday’s declines the Dow was at levels last seen in, well, mid-December and was up more than 30 percent since the 2016 election.
Strategists over at Goldman Sachs wrote:
“The stock market correction appears to be more technical and positioning-driven rather than fundamentally-based.We believe the fundamental drivers of the equity market remain intact and reiterate our S&P 500 year-end 2018 forecast of 2850.”
SpaceX successfully launches its Heavy Falcon rocket.
The company, founded by Elon Musk, achieved a new milestone with a successful test launch of its Falcon Heavy rocket, the most powerful rocket in operation in the world today.
Here’s a video of the launch: