China, North Korea Drama Headline Hectic Week

Auto and energy stocks also attracted attention on Wall Street

Managing Editor
May 25, 2018 at 1:18 PM
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Markets were strife with geopolitical drama this week, as re-emerging tensions over trade issues with China and the cancelled nuclear summit with North Korea kept investors on edge. In addition, traders eyed sinking oil prices and digested the latest Fed meeting minutes. Through it all, though, the Dow, S&P 500, and Nasdaq are still on track to squeak out weekly wins, with the former even briefly peeking atop the 25,000 level. Meanwhile, the Russell 2000 Index (RUT) continued its torrid pace on its way to its best month since November 2016.  

Retail Stocks Front And Center

Retail stocks were in particular focus this week. Nordstrom (JWN) struggled after earnings, but Deutsche Bank analysts are unfazed.  Options bears piled on Shopify (SHOP) stock after short seller Citron Research doubled down. Target's (TGT) profit miss sent the stock reeling, and J C Penney (JCP) stock collapsed after its CEO left for Lowe's (LOW). Urban Outfitters (URBN) and Kohl's (KSS) both saw increased options activity ahead of their earnings reports, while Macy's (M) rewarded our subscribers following an impressive first-quarter earnings beat

Chip Stocks Make Waves, Fortnite Reigns

Several chip stocks found themselves in the news this week as well. Analysts heaped praise on Micron (MU) after its new share buyback program and upwardly revised current-quarter earnings guidance. Advanced Micro Devices, (AMD) on the other hand, is bracing for a historically tough week. Apple suppliers got a boost as Apple's WWDC event approaches, and lesser-known chip name Cypress Semiconductor (CY) offered up an intriguing "buy" signal.

Shifting gears a little, Box Inc (BOX) stock continued to impress analysts. SNAP (SNAP) is backpedaling on its Snapchat app re-design, and options bulls are taking note. In the gaming corner, Turtle Beach (HEAR) and Fortnite remain unstoppable on the charts, and Boyd Gaming (BOYD) appears ripe for a contrarian trade

Drug Data, FDA Move Biotechs

Concerns about the side effects of its pneumonia drug dropped Nabriva Therapeutics (NBRV) stock, while Zoetis (ZTS) remained red-hot and flashed a "buy" signal. Cara Therapeutics (CARA) scored a critical licensing deal, and could soon burn short sellers. KenPharm's (KMPH) ADHD drug has analysts excited, while the Food and Drug Administration (FDA) sent BioMarin Pharmaceutical (BRMN) stock on a nice run. The same can't be said for Recro Pharma (REPH) stock, though, which crumbled after the FDA rejected its non-opoid injection

Big-Cap Tech, Auto Stocks Make Noise

Cisco Systems (CSCO) dipped following a possible Russian hacking. Microsoft (MSFT), one of the best Dow stocks in 2018, got a lift after a bullish brokerage note from Cowen. Among other big-cap name in the news this week, Netflix (NFLX) stole headlines after inking a deal with former President and First Lady Barack and Michelle Obama.

Shifting the focus to cars, Tesla (TSLA) introduced a new high-performance Model 3, while China's willingness to cut import taxes on some vehicles boosted these auto stocks, as well as Avis Budget Group (CAR).

Oil, Gold Stocks in Focus

Although oil prices dipped toward the end of the week, Chesapeake Oil (CHK) is barreling towards its best month in years, while Petroleo Brasileiro (PBR) plunged amid political woes. What's more, if past is prologue, it's best to stay away from these blue-chip oil stocks next week. If you're looking for a commodity stock to buy, however, Barrick Gold (ABX) might be the play. 

Best Stocks to Own During the Holiday-Shortened Week

Ahead of the the official start to summer, here's a list of the best and worst stocks to own during Memorial Day week. Jobs data and more retail earnings will be headlining during the holiday-shortened week, but this bond yield signal shouldn't be ignored. 


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