Nasdaq Today: Amazon Prime Day; Facebook Settles With FTC

A trifecta of perfection: We had record highs in the S&P 500, Dow Jones and Nasdaq today. Shareholders in the PowerShares QQQ ETF (NASDAQ:QQQ) have little to complain about as tech stock continues to mash out higher highs over the past few sessions.

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That’s as FAANG stocks mostly lag and while rate cuts are likely.

That said, it’s not expected to be an amazing quarter when it comes to earnings. Companies are warning about their upcoming results, while analysts’ estimates are looking at year-over-year declines for many names.

Blame it on tough comps from tax cuts, tariff wars or what have you. It’s not a perfect operating environment and with stocks near all-time highs, investors are either willing to overlooking a few quarters of underperformance and pay a higher valuation for earnings or they area simply too optimistic. We’ll know soon enough when we start seeing these companies report.

Facebook Settlement

Facebook (NASDAQ:FB) shares spiked into the close on Friday, ending the session higher by 1.8%. Reports surfaced moments before the close that the company had come to terms on a $5 billion settlement with the FTC. The deal is expected to have some other privacy restrictions as well.

While $5 billion is a lot of cabbage, it’s roughly the same amount that FB set aside to pay for such an event. Clearing this obstacle removes an unknown event for investors, who like clarity and having uncertainty removed.

Movers in the Nasdaq Today

Illumina (NASDAQ:ILMN) shares sank more than 15% on the day after the company warned about its upcoming results. This caught investors way off guard, considering the company just beat and raised estimates a few months ago. It’s not a good look for the genomics company, as it now hovers in no man’s land. (Here’s the trade setup for ILMN stock now).

One could argue that it also weighed on Invitae (NASDAQ:NVTA), although the company’s $50 million acquisition could be what’s shaking up the stock price. Down 1.75% on the day, it’s at least worth pointing out.

Square (NYSE:SQ) stock jumped almost 4% on Friday, giving it a 10% gain over the past few days. The stock has seen some positive analyst commentary over the past few days, with the latest coming from Citigroup on Friday. While the stock is running into some resistance, many have it on breakout watch.

JB Hunt (NASDAQ:JBHT) caught a big bid on Friday, rising over 6% on the day. However, currently trading hands for around $93 apiece, shares are well off the 52-week highs near $130. Be careful with this one, which reports earnings Monday.

The $45 billion technology consulting company Infosys (NYSE:INFY) reported earnings on Friday. Shares hit new 52-week highs on the day, despite missing revenue estimates and reporting in-line earnings results. Better-than-expected guidance and an increase in its capital return plan likely helped, though.

Memory and memory equipment stocks were also in focus in the Nasdaq today, as Lam Research (NASDAQ:LRCX), Western Digital (NASDAQ:WDC) and Micron (NASDAQ:MU) all put together a strong session. Micron is flirting with prior resistance, but a move over $44 to $45 could trigger a breakout.

All About Amazon

Shares of Oracle (NASDAQ:ORCL) slipped 30 basis points on Friday after the company lost its court case against the Pentagon. The $10 billion cloud contract will now go to either Amazon (NASDAQ:AMZN) or Microsoft (NASDAQ:MSFT). But that’s far from the only reason Amazon stock is in the news day.

First, the company’s much-discussed Prime Day is set to start next week. Prime Day will kick off on July 15th and run through the 16th. The made-up shopping event isn’t unlike Alibaba’s (NYSE:BABA) Single’s Day, while Amazon now attracts others competitors into mix as well. Companies like Best Buy (NYSE:BBY), Target (NYSE:TGT) and Walmart (NYSE:WMT) will be running specials too, trying to keep customers away from the e-commerce juggernaut.

As the smart-speaker battle heats up, Amazon is reportedly looking to better its game. The company wants to roll out a high-end Echo device, which could arrive next year. Further, Amazon is also working on an Alexa-powered robot. Codenamed Vesta, the devices apparently will not be ready for mass production this year.

Last but certainly not least, Amazon’s game-streaming Twitch platform logged more than 2.7 billion hours worth of streaming in the second quarter. For the industry, that accounted for more than 70% of the total. The next closest was Alphabet’s (NASDAQ:GOOG, NASDAQ:GOOGL) YouTube Live at 735 million hours and 19.5% market share. It was Twitch’s second-biggest quarter ever.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AMZN and GOOGL. 

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