DT# 228 – Nice try Ankara!


Global Economy  Nice try Ankara!

Stocks fell for the fifth time in six sessions, as investors continue to weigh whether trade tensions and an emerging markets sell-off could slow the global economy. Turkey was in focus again after it doubled tariffs on some U.S. imports, but late afternoon the country was ready to discuss its issues with the U.S. and it helped stocks trim their losses before the close.

Big losses in the energy sector (-3.5%) also weighed on the broader market, as WTI crude oil sank 3% to $65.01/bbl after the weekly U.S. inventory report showed a build of 6.8 million barrels. Energy wound up finishing well behind the 10 other sectors in the S&P group

Fortnite on Android

Google (GOOG) Android users will download about 170 billion apps (+20B Y/Y) and spend over $50 billion (+$10 billion Y/Y) this year, according to a research lab.

Fortnite is a driving growth factor with the popular game currently in beta, after launching on iOS in April. The game has topped iPhone sales in 113 countries since that launch. Epic Games chose to bypass the Google Play store in favor of direct downloads at the game developer’s website. That means Apple doesn’t get the 30% cut on in-game transactions.

Alibaba is on sale

Alibaba (BABA) is an aggressive, asset-light, cash generating machine. Shockingly, in spite of firing on all cylinders, its share price has hardly budged in the past year. Alibaba is undeniably undervalued and investors should capitalize on this opportunity. Although its results are out next week, I believe that investors should use its current price weakness to their advantage. Whether Alibaba continues to deliver results which impress analysts or not, it should make no difference to long-term investors, looking to grow their capital.

US airline stocks in focus

While there’s been a little bit of a disconnect between the share prices of U.S. airlines and the level of jet fuel prices, today’s sudden drop in crude oil price has caught our attention. We suggest to keep an eye on the airlines’ stocks, and it is not only because of aforementioned oil price, but when we take a look at the jet fuel inventories, we find that it is lower than usual. Many carriers tightened capacity in an effort to better control fare pricing and profitability, but that battle seems to be a never ending story.

#Daily Pick

AT&T (T) announced today the completion of its acquisition of AppNexus, now part of AT&T advertising & analytics segment.

Amazon (AMZN) and Microsoft’s (MSFT) tie-up is now available to U.S. users as a public preview. Cortana and Alexa now have access to each other’s functions.





Amazon (AMZN) wants to turn its Twitch gaming property into a broader video service to take on Alphabet’s (GOOG) YouTube.





Apple (AAPL) is under antitrust investigation in Japan due to allegedly pressuring Yahoo Japan to pull back its competing game platform.

Notable Earnings today: AMAT, ATGE, JWN, NVDA, ZOES, DESP, JCP, JD, MSG, QIWI, WMT, WUBA.

FX World

Turkey has tried to counter US sanctions with not much of a luck, but it was enough to the exchange market to feel the heat. EU banking system is still under the spell of the lira, and it doesn’t seem to change today.

The EURUSD tried to form a hammer yesterday, the expected ralli seems to be on the way, with extensive selling opportunities at 1.25. Nothing has changed so far.

The GBPUSD broke down Tuesday’s candle. Short term rallies expected to 1.28, while the downtrend is inevitable, and we are heading to 1.25.

The USDJPY initially rallied, but made a fast drop towards the 110 level. If the continues to go lower, our floor is 109, while we don’t consider shorting the pair just yet.

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