They pummel and then they restore. That's the new pattern for the quarter. Take yesterday. Most of the big gainers were stocks had been hammered not that long ago that seem not to be able to stay down.
Top of the list: Williams Companies (WMB) . You have ask yourself, how is this company's stock doing well in the aftermath of the broken deal with Energy Transfer Equity (ETE) ? Half of the members of the board have quit. Who knows what they can earn. But we know this. Pipes are worth more than we think to many different entities, hence why Kinder Morgan (KMI) keeps going higher after its sell of a half of a pipe to Southern SO the other day.
Pipes are valuable. The public paid too much for some of the agglomeration of pipes, particularly the oil pipes. But natural gas is still under-piped, so Williams might be worth more than it is selling for on a break-up value.
Or, how about Qorvo (QRVO) ? Here's a supplier to Action Alerts PLUS charity portfolio holding Apple (AAPL) that's been horrendous since 13 months ago when it peaked at $88. It hit $34, but has now managed to bounce to $59, up $2.64 in yesterday's session.
But Apple's now enjoying the rosy glow, rightly or wrongly, of Taiwan Semi's smart phone numbers, and the presumption is now that maybe things aren't as bad for the Cupertino colossus. Last time the stock ran into the quarter and got crushed. Bulls should hope it loses a head of steam going into the quarter, but that's not looking like it's going to happen now.
Then a trio of airlines that was down more than 25% is rallying again: United (UAL) , American (AAL) and Delta (DAL) . I am beginning to believe that what happened at the end of the last quarter was some sort of massive liquidation. The snapshot of the June numbers frankly isn't that good to warrant these kinds of advances. They were just entirely oversold.
The rest are more of the same. Skyworks (SWKS) is Qorvo. Kinder Morgan is Williams. It's the hated that's come back to life.
Yesterday was a reminder of a simple concept: this market wants to buy stocks that are low or were prone to liquidation, when it can. The fundamentals? They aren't great, but they were apparently not as bad as we thought.And that's enough to start some buying that snowballs throughout the day.