The first day back from a three-day weekend was a solidly bullish one, with most investors of U.S. stocks widely presuming the nation’s government would restart its slowing economy with a decent dose of stimulus. When all was said and done, the S&P 500 finished the day at 1969.41, up 2.51%.
That strength wasn’t universally infectious, however. Alibaba Group Holding Ltd (NYSE:BABA), Netflix, Inc. (NASDAQ:NFLX) and Twitter Inc (NYSE:TWTR) all finished the day rather deep in the red, for a variety of reasons. Here’s what happened.
Twitter Inc (TWTR)
Just when it looked like Twitter might finally be headed for some stability — even if it was a lackluster stability — TWTR shareholders got the rug pulled out from underneath them today when the CEO-less company announced its former CFO and current VP of the company’s venture division has left the flailing company to take on the CFO role at startup software company Docker.
Jack Dorsey is still the acting CEO, temporarily stepping in to fill the role Dick Costolo vacated in June. But, with Dorsey never being intended as a permanent replacement and another key executive bailing out today, TWTR shareholders are understandably wondering if there’s a bigger reason the company can’t find and retain talented managers.
All told, TWTR closed more than 3% lower on Tuesday.
Alibaba Group Holding Ltd (BABA)
Shares of once-red-hot Chinese e-commerce name Alibaba Group Holding were cold once again today, with Tuesday’s 4.7% dip translating into a 30%-plus tumble since peaking on May 22.
The prod for today’s pullback from BABA was reports that the e-tailer’s second quarter (ending this month) sales volume — what it refers to as gross merchandise volume, or GMV — was apt to be down by a mid-single-digit pace. CEO Jack Ma, when speaking at the Global Tech Conference on Tuesday, added that Chinese consumers were tightening their purse strings, so to speak, which was creating a headwind for BABA.
Investors had sensed the headwind anyway, given some dire economic news from China in addition to the recent implosion from China’s stock market. Ma’s comments, however, served to solidify those concerns.
Netflix, Inc. (NFLX)
Last but certainly not least, for the third time in less than two weeks, Netflix shares earned a spot on the daily “Worst Stocks” list, with today’s 3.9% stumble qualifying NFLX for Tuesday’s dubious pole position.
The prod for the steep selling was a familiar tune … just sung by someone else. That is, Netflix was panned by the financial media for suggesting it wasn’t interested in letting subscribers download content and view it later, while offline.
The follow-up commentaries in response to Netflix Chief Product Officer Neil Hunt’s comments on the matter simply solidified that NFLX was becoming less and less competitive compared to names like Amazon.com, Inc. (NASDAQ:AMZN), which recently announced that Amazon Prime members could download and watch videos without needing to be online to view them.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
