U.S. markets bounced back solidly Friday, as oil and financials (which were crushed Thursday) did an about face.
Crude oil shot up over 12% intraday, then finished up well over 10%. It was the best one day performance in seven years, as another report suggesting that OPEC is ready to cut production had investors hoping for a price turnaround.
Giving the financials a shot in the arm was J P Morgan Chase & CO’s (NYSE:JPM) announcement that CEO Jamie Dimon was buying more than $25 million worth of JPM stock.
Another positive for the markets was the U.S. retail sales report, which came in 0.2% higher for January, a tick above expectations. Investors noted that makes it less likely the U.S. is heading for a recession.
The Dow Jones Industrial Average advanced over 300 points, or 2.0%, while the gain for the S&P 500 was 1.9%, and 1.6% for the Nasdaq. Energy and financial stocks led all sectors higher.
JPM was not the only financial roaring Friday. Deutsche Bank AG (USA) (NYSE: DB) was also doing well, and DB, along with Wynn Resorts, Limited (NASDAQ:WYNN) and Twitter Inc (NYSE: TWTR) are three of Friday’s best Stocks.
Here’s why they were like money in the bank Friday.
Deutsche Bank AG (USA) (DB)
Deutsche Bank flexed its financial muscles Friday by announcing it will offer a tender to repurchase a total of $5.4 billion of its own bonds.
The bonds include $2 billion in dollar denominations, as well as 3 billion in euros. Deutsch issued a statement, saying, “The bank’s strong liquidity position allows it to repurchase these securities without any corresponding change to its 2016 funding plan”.
The move was seen as a way to allay investors fears going forward. Since November, DB stock has fallen from $30 to $15, and management is looking to stop the bleeding quickly. DB stock rose 12% Friday on 8.1 million shares.
Wynn Resorts, Limited (WYNN)
Shareholders of WYNN stock were rolling 7’s Friday after the Casino and hotel operator reported fourth quarter, 2015 earnings of $1.02 a share on revenue of $946.9 million.
Analysts who estimated only 76 cents a share were left in the dust. However, WYNN’s revenue was short of the estimates for $948.4 million.
The problem for WYNN this year was declining earnings from Macau, even while their Las Vegas business was showing improvement.
WYNN stock has been trading in a range between $50 and $72 over the past six months. WYNN finished over 15% higher.
Twitter Inc (TWTR)
We mentioned recently in this space that TWTR stock was rising on anticipation of good earnings. They in fact, did put out good numbers, as their earnings of 16 cents on revenue of $710.5 million actually beat the street’s estimates on both EPS and Revenue for the quarter.
But TWTR stock actually fell to $13.91 on Thursday, its all time low, before rebounding to finish at $14.31. But Friday, TWTR stock vaulted higher by nearly 11%.
The street’s beef was that TWTR reported the same number of users in this quarter as last year, and U.S. users declined by one million. In fact, John Divine of InvestorPlace called Twitter “Utterly Worthless” going forward for that very reason, despite their EPS and revenue beats.
But at least for Friday, TWTR rose 11%, despite having its price target cut from $45 to $24 by Argus. Well known investor, Mark Cuban told Bloomberg that Twitter is “fixable,” although he declined to say publicly how he would do it. And investors were also swayed by Twitter’s increase in ad revenues, despite the lack of user growth.
Whatever the reason, most stocks are due for a bounce when their price is cut in half over the last three months.
Friday was that day for TWTR stock.
As of this writing, Ethan Roberts did not hold a position in any of the aforementioned securities.
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