Banner Week for U.S. Stocks, Despite Chilly iPhone X Reception

Apple shares dropped after the company's highly anticipated event on Tuesday

Sep 15, 2017 at 2:38 PM
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It was a banner week for U.S. stocks -- not to mention oil prices -- with the Dow Jones Industrial Average (DJIA) currently pacing for a sixth straight win and a fourth straight record close. In fact, the blue-chip index is set for its best week of 2017, while the S&P 500 Index (SPX) is aiming for its best week since April. Stock markets this week seemingly shrugged off escalating tensions with North Korea, which fired off another missile toward Japan, and celebrated reports of less damage than expected from Hurricane Irma. Also making noise this week were Apple's new iPhone, the Equifax saga, and a handful of drug stocks.

Apple Dips After Big iPhone Reveal

The tech-rich Nasdaq Composite (COMP) enjoyed a big day on Monday -- continuing a recent trend of early-in-the-week rallies -- as traders waxed optimistic ahead of Apple's highly anticipated iPhone event on Tuesday. Apple options traders picked up out-of-the-money calls, and analysts bet on higher highs for AAPL shares.

However, the $999 iPhone X -- and its November release date -- initially failed to inspire Apple shareholders, as the stock ended lower for three straight sessions. The event also sent Energous stock spiraling lower, and sent Apple options volume into a frenzy. (Elsewhere, fellow FAANG member Alphabet could make noise with Google's smartphone event in a few weeks.)

Irma Damage Estimates Decline

Travelers stock started the week off strong, as insurance stocks attempted to stage a rebound amid the latest Irma-related damage estimates. However, one insurance name had a particularly bad week, after Mox Reports warned the shares could fall below $1 amid fraud accusations, and home-improvement retailers like Home Depot dipped. Further, Carnival stock continued to struggle after the hurricane rocked the cruise-friendly Caribbean, and several airlines cut their current-quarter outlooks.

Equifax the Next Enron?

Equifax remained in the headlines after last week's massive data breach. The credit reporting company was in the hot seat on Capitol Hill, with Senator Brian Schatz of Hawaii taking to Twitter to ask about possible insider trading. While Senate Minority Leader Chuck Schumer said it is "one of the most egregious examples of corporate malfeasance since Enron," Democratic Senator Elizabeth Warren of Massachusetts sent a letter to the Government Accountability Office requesting a probe into the company. Equifax is already being investigated by the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB). EFX stock has dropped more than 25% in the past week, dragging down the shares of other credit agencies.

Drug Stocks Continue to Make Noise

It was another busy week for biotechs. Aldeyra Therapeutics and Aethlon Medical were among the small-cap healthcare stocks with huge gains, while Abeona Therapeutics was named one of RBC Capital's small-cap favorites. Among the big-cap pharmaceutical stocks making noise was Dow component Pfizer, which rallied to new highs. Option bulls came out for bluebird bio stock and this record-setting healthcare ETF, while this drug stock sent up a "buy" signal. However, it wasn't all sunshine and rainbows. Mallinckrodt stock was slapped with a major price-target cut, and Intercept Pharmaceuticals hit a new low after ugly drug data.

September Fed Meeting on Tap

The Fed will take center stage next week, with the Federal Open Market Committee (FOMC) hosting its September meeting. Following the policy statement Wednesday afternoon, Fed Chair Janet Yellen will speak. While the central bank isn't expected to raise interest rates at next week's meeting, it seems the odds of a December rate hike are now above 50% following the latest inflation data -- a recent boon for bank stocks.

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