Hope of progress on China trade is keeping a strong bid under this market. Breadth is very good with around 4950 gainers to 1700 decliners. There is quite a bit of strength in China-related names which is giving some market participants increased optimism that a deal on trade may be forthcoming.
The big danger will be a 'sell the news' reaction to any trade news but that is being outweighed right now by the fear of missing out.
There continues to be very good action in individual stocks. Names that I've mentioned recently such as Nio (NIO) , Bloom Energy (BE) , Amarin (AMRN) , Uxin (UXIN) and Intelsat (I) continue to perform well, and I have my eye on ride sharing play HyreCar (HYRE) .
Most of the business media today is focused on the disaster at Kraft Heinz (KHC) . The company missed estimates, took a $15.4 billion goodwill charge, and indicated that it received a subpoena from the SEC related to a variety of issues.
This has produced a slew of downgrades and target cuts and very little defense so far. What is most notable is that this is one of Warren Buffett's bigger positions at Berkshire Hathaway (BRK.B) . However a 20% loss in KHC only has about a 1% impact on Berkshires balance sheet.
Analysts appear to be fearful of the unknowns in the situation and standing aside, but Buffett is scheduled to appear on CNBC on Monday and there are some that are looking for him to defend the company. I expect to see some buyers position for that possibility later in the day.
Consumer staple stocks like KHC, Kellogg (K) , and Campbell Soup (CPB) have been regarded as safe 'widow and orphan' stocks in the past. So was General Electric (GE) and we saw how far that has fallen over the past couple decades.
So far there is no bounce in Kraft Heinz which is not a good sign. If I was an owner of the stock I would probably stay with it for now as there probably isn't much more downside in the near term. I would have no interest in trying to buy it as an investment at this time.