Investors were thrown a couple of curveballs on Monday, with gold and oil prices both rallying firmly for a change against a backdrop of reports that Black Friday weekend spending was down 11% compared to last year’s totals. It’s the first time in a long time it appeared consumers weren’t confident and cash-slush (and investors chose to see it).
Confused and perhaps a little ready to take-profits anyway, investors sent stocks modestly lower. The S&P 500 ended the session roughly 0.7% lower than Friday’s closing levels.
A mere tumble like that would have been a relative victory for WEX Inc. (WEX), Twitter Inc. (TWTR), and Atlas Pipeline Partners, L.P. (APL), however. Each of these three names took on more than their fair share of water on Monday.
As if Twitter shareholders hadn’t suffered enough since early October, the micro-blogging company’s site sank more than 6% on Monday, toying with new multi-week lows in the process. The stock’s now down 30% from its October peak.
The latest selling catalyst for TWTR stock was a report that the company’s biggest shareholders, co-founder Evan Williams, sold 719,000 shares last week. That’s about $29 million worth of Twitter stock. Although Williams remains the biggest shareholder, the market is clearly wondering if this insider knows something about the future that the rest of the market doesn’t know.
Atlas Pipeline Partners (APL)
The market may be unduly bidding all energy names down in lock-step with the meltdown of oil prices, but that doesn’t make any of these stocks any easier to own. Among the hardest hit on Monday was Atlas Pipeline Partners, with APL stock falling 16% and hitting new 52-week lows in the process.
The irony is, of all the names that are relatively well-shielded from the breakdown in crude oil prices, Atlas Pipeline Partners belongs near the top of that list. The company is almost exclusively a natural gas player, and natural gas prices — even with the 13% slide since mid-November — are still only a tad below the floor at $4.06 established during the calendar third quarter of this year.
Fleet payment-solutions service provider Wex took a 9% hit on Monday. That brings the two-day total loss to a whopping 12%, on no actual news whatsoever.
It’s likely that traders are mentally connecting some doubts, concluding that low gasoline prices ultimately means lower billings for Wex, which in turn could mean weaker per-share profits for WEX stock. The premise is really stretched though, as it oversimplifies how (and how much) the company generates revenue. The theory also ignores the fact that cheaper fuel could allow its client fleet operators to put more miles on vehicles.
Whatever the reason, WEX shares have taken a big hit since the middle of last week, giving up the bulk of the gain they’d managed to eke out this year.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
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