Sure the employment number wasn't that strong. Yes there's a bit of a slowdown. But, oddly, we have panic moves now that are simply out of control in health care, retail, tech and airlines. And I can't really link them to the jobs number, as much as individual earnings reports that just aren't up to par.
For example, take Endo International (ENDP) which is down 40% after guiding its earnings forecast down dramatically in last night's report. Endo is another company, like Valeant (VRX), that borrowed a ton of money, bought another drug business for $8 billion that now seems like a huge mistake, and now has lost all credibility on Wall Street.
It is causing another round of losses for Valeant stock, as well as Horizon Pharma (HZNP), which some believe used the same model, Mallinckrodt (MNK), which also borrowed big money to buy other drug companies and the incredibly abused Allergan (AGN), an Action Alerts PLUS holding,
which now trades at almost half of the price Pfizer (PFE) was going to pay for them before the government stepped in and blocked the bid. The losses are humongous.
The stocks of retailers, meanwhile, are being rocked, once again, by fears of a radical decline in mall traffic as well as the massively disruptive Amazon (AMZN). There is no respite from that selling. These stocks just go down on the same information over and over again, and no one dares get ahead of them.
Airlines can't lift. The transports are truly rolling over. Always bad signs.
And then there's tech. Today's loss is in Square (SQ), the payment processor run by Jack Dorsey, who also runs Twitter (TWTR). Expenses are way too high, credit risk has surfaced and a looming lock-up expiration are all weighing on the stock.
Meanwhile, once again, Apple (AAPL) is getting hit, as it still can't find its footing after the recent guidance cut. The entire Nasdaq's under pressure because of Apple, an Action Alerts PLUS holding, and a couple of other big misses in personal computer and cellphone-related businesses.
But none of this changes my view that there 's always a bull market somewhere. It's just now in those consumer products stocks that were acting so badly for so long. They are back in favor because of the slowing economy.
There are still some stocks hanging in the balance. If we get the dollar weaker and oil up, then there will be more money going into the industrials.
But right now the panics are prevailing and until they stop, no one will be emboldened to come in and do some bottom fishing in the collaterally damaged names that simply don't deserve to go down with the velocity that they are experiencing on the Street.