What will be a shortened trading week at least got off on a bullish foot, suggesting we may see a Santa Claus rally after all. When all was said and done, the S&P 500 ended the session at 2021.15, up 0.78%. That didn’t undo all of Friday’s damage, but it’s a start.
Either way, for Juniper Networks, Inc. (NYSE:JNPR), GoPro Inc. (NASDAQ:GPRO) and Petroleo Brasileiro SA Petrobras (NYSE:PBR) shareholders, the day’s broad bullishness was of no solace. Here’s what investors need to know.
Petroleo Brasileiro SA Petrobras (PBR)
Petroleo Brasileiro SA Petrobras — better known as Petrobras — once again earned a top spot on the market’s “Worst of” list, for reasons that are no longer new or surprising. Indeed, a closer look at PBR reveals there was no specific reason PBR stock lost more than 5% of its value on Monday. Rather, it was once again a combination of falling oil prices and a reminder of corruption in Brazil that could end up becoming economically crippling.
The latest in the saga: On Friday, it was reported that several Brazilian companies were cutting their expenditure plans for 2016. Among the biggest budget-cutting plans were those from PBR.
Even without Petrobras planning to cut spending in 2016, however, investors are understandably worried that there’s more corruption to be uncovered in Brazil. That makes PBR stock an even bigger risk than the average oil producer.
Juniper Networks, Inc. (JNPR)
Cybersecurity shortfalls and their subsequent hacks are nothing new. Indeed, cybercime is the norm now. Still, when your cybersecurity technology is so flawed that the FBI chooses to open up a probe of it, that’s an alarming sign. Just ask shareholders of Juniper Networks, who watched JNPR stock fall more than 4% on Monday for that exact reason.
That’s right — Juniper Networks firewalls have an enormous flaw that easily lets hackers upload code to the company’s security equipment. The FBI is particularly concerned that the U.S. government may have been exposed to foreign-government hacking.
A statement from Juniper explained that even the log of any such attacks (which would normally indicate the system had been breached) wouldn’t necessarily indicate it had happened in this case:
“Note that a skilled attacker would likely remove these entries from the local log file, thus effectively eliminating any reliable signature that the device had been compromised.”
GoPro Inc. (GPRO)
Last but not least, GoPro — once again — lost a painful amount of ground on Monday, with the latest round of selling most likely stemming from commentary on TheStreet.com, which cited three clear and rational reasons to sell GPRO shares.
Simultaneously, though no mainstream media source has covered it, yet, investors have picked up on the fact that the FAA just put up a major roadblock to GoPro’s 2016 drone ambitions.
Specifically, the FAA is now requiring drone pilots to register with the agency. While it’s clearly not a ban on drones, the registration requirement is a philosophical problem for would-be users with privacy concerns. Other drone pilots may simply see the registration requirement as a sign that the flying devices aren’t mere toys, and therefore more potential trouble than they’re worth.
GPRO fell more than 7% on Monday.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
