Uhhh … Happy New Year, Wall Street?
A 7% slide in Chinese stocks overnight weighed heavily on U.S. markets today from the opening bell and caused markets to sink more than 2% in very volatile trading. It was the worst performance for the Dow on the year’s first trading day in eight years.
The reason for China’s worst day in the last four months was a further decline in the Caixin manufacturing PMI, along with an impending lifting this week of the six month selling ban for large shareholders of all listed companies.
The Caixin PMI, at 48.2, was once again below 50, suggesting a further contraction of manufacturing. However, the overall manufacturing PMI was a bit better, with a reading of 49.7.
Here in the U.S., things were not much better. The December ISM Manufacturing Index was also 48.2, down a few ticks from the November reading.
Even with a bit of late buying, the Dow Jones Industrial Average was hammered down 1.6%, while the S&P 500 was off a slightly better 1.5%. The Nasdaq was 2.1% lower. Other than gold and some energy LP’s, all sectors slid badly.
But despite the gloom and doom, as usual some stocks still held their own. Three to focus on today are 3D Systems Corporation (NYSE:DDD), Lululemon Athletica Inc. (NASDAQ:LULU) and Barrick Gold Corporation (USA) (NYSE:ABX). Each soared for reasons of their own and are three of today’s best stocks.
3D Systems Corporation (DDD)
At the onset of 2014, DDD stock was trading for nearly $90 a share. But hard times befell the company and it recently hit a low of only $8.44. Long-term shareholders were desperate for some good news, and today they got some.
3D announced its new metal printer, called the ProX DMP 320. The company website says it’s “designed for high precision, high throughput direct metal printing and optimized for critical applications requiring complex, chemically-pure titanium, stainless steel or nickel super alloy parts.”
Peter Lynch, who said invest in what you know and understand, would have had a field day with that. Suffice it to say DDD has made some positive improvements, and will be showcasing the new equipment at the international Consumer Electronics Show (CES) from Jan. 6 to Jan. 9, in Las Vegas, NV.
The news was good enough to send DDD soaring up 13% today.
Lululemon Athletica Inc. (LULU)
Wall Street analysts were loving all over LULU today, and pushed LULU stock 6.5% higher. Wells Fargo & Co upgraded their rating to “outperform.” Wells Fargo said there are three reasons to like the stock in 2016, those being improved design of their shirts and yoga pants, improved production to become more consistent and an improving supply chain to reduce costs, minimize company discounts and increase the margins of profit.
But Wells Fargo was not alone. Jefferies Group LLC upgraded LULU stock to “buy” and gave it a price target of $70, about $14 above current price. Jefferies’ comments were almost identical to those of Wells Fargo.
Barrick Gold Corporation (USA) (ABX)
All the dominoes fell the right way for ABX stock today. The weakness in both China and the U.S’s manufacturing data pushed stocks and the dollar lower. This in turn boosted the price of spot gold, which led to a big rise in gold and other mining stocks today.
Barrick gold led a group of gold mining stocks higher, including other names such as Newmont Mining Corp (NYSE:NEM) and Goldcorp Inc (USA) (NYSE:GG).
ABX stock and the other mining companies were crushed in 2015, so investors are hoping for a better 2016. ABX ended the day up 5%.
As of this writing, Ethan Roberts does not hold a position in any of the aforementioned securities.
