In The News:
Two of the US indexes, the DJIA (Dow Jones Industrial Average) and the S&P 500 (Standard and Poor’s) rebalanced on Friday. As we mentioned a couple weeks ago, the DJIA announced it would remove Bank of America, Alcoa and HP from its index. All three were replaced after the close on Friday with Nike, Visa and Goldman Sachs. The S&P also had its quarterly rebalance on Friday. The S&P 500 index is a weighted index based on the market capitalization of 500 large companies traded on the NYSE (New York Stock Exchange). Once a quarter, the index rebalances itself by changing the weightings of companies in the index based on the company’s market capitalization. For this quarter’s rebalance, the S&P reduced the weighting of Apple and Disney in the index and raised the weighting of Google and General Motors. Bottom line: If you are an index investor, i.e. your stock portfolio is based solely on the weightings and stocks of the DJIA and S&P indexes, you will obviously be affected. However, if you are an average retail investor, you more than likely will not see a significant difference in your portfolio based on the rebalance itself.
Trading of Blackberry shares were halted on Friday for a “big” announcement from the company. Unfortunately this time, “big” was not good. Blackberry announced its Q2 financials a week early, reporting a loss of nearly $1 Billion for the second quarter, three times greater than analysts had predicted. The company also confirmed that the rumor was true: They will slash 40% of the company’s global work force. Lastly, the company announced it would only roll out four of the six new models it had planned for the year. This year has been a tough one for Blackberry. Last month the company announced it was looking for ways to stay afloat, including a possible sale.
Shares of Blackberry plunged 20% after trading resumed. The company’s stock is down 26.5% for the year.
Sprint, the third largest wireless carrier, joined the rank of Verizon, AT&T and T-Mobile on Friday, announcing its version of the “upgrade sooner” program. The new service, called Sprint “One Up,” allows customers the option of a brand new smartphone every 12 months. One Up, the service, will combine an annual upgrade along with unlimited voice, text and internet access, starting at $65 a month. Because of the combination, most analysts say Sprint’s version may be the best in the industry.
In The Markets:
Asian markets closed mixed on Monday. The Shanghai composite was up as better economic data out of the region sparked hope the country is on the road to recovery. The Hang Seng closed lower after Typhoon Usagi slammed into the southern china coast causing a temporary shutdown of the market. The Nikkei is closed due to public holiday.
European shares moved lower Friday, as investors headed for the sidelines ahead of the German election over the weekend
US markets tumbled on Friday. Comments from Fed Governor Bullard that the taper could start in October caused investors to pull their head out of the clouds and face reality. DJIA:-181.09 15455.46 NASDAQ: -14.66 3774.73 S&P 500 -12.55 1709.79
In Dinner or Drink:
1 1/4 oz. amaretto almond liqueur
1/4 oz. Blue Curacao liqueur
Almost fill a shot glass with amaretto. Carefully pour the blue curacao into the middle to create a blue “twist”.
If you like our receipe of the day, click here.