Monday Stock Market News and Notes: Jobs Report Surge + Big Gains for Electric Services Firm

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Markets are off to a fast start for the week, feeding off the momentum from last Friday, when an extremely strong jobs report bolstered investors’ confidence in the state of the US economy’s historic expansion. All major indexes are up at the time of this writing.

Among today’s headline-movers is Apple (NASDAQ:AAPL), up 1.5% during today’s trading and sitting at an all-time high above $190. In recent months, Apple has begun a strategic effort to expand its business model beyond consumer-facing innovation: they’re looking to expand their presence in the electronic device vertical by beginning to manufacture their own chips. Investors generally appear enthused by the strategy, which constitutes a distinct threat to chip manufacturers like Intel (NASDAQ:INTC) that dominate the current market.

Indeed, Apple has constituted a huge portion of markets’ recent growth: “If you look at the month of May, Apple — all by itself — contributed 23 percent of the S&P 500’s gains,” Jeff Kilburg, CEO of KKM Financial, as quoted by CNBC.

We would generally expect strong jobs growth to result in strengthening consumer spending. In this vein, retailers that are proving they possess the agility to compete in the e-commerce space continue to perform particularly well. Target (NYSE:TGT), for instance, is up over 4.5% at the time of this writing. Walmart (NYSE:WMT) is up over 2%.  

More drama could be in store for traders in the coming week. An announcement of US tariffs on metal imports from Mexico, Canada, and the EU shook markets last week before strong job numbers restored some bullish momentum. But markets await news of a potential multilateral response from US trading partners, who have already begun announcing some retaliatory measures.

The “return to volatility” after months of calm-seas growth for equity markets continues to be the dominant theme for traders in 2018. But volatility, while nerve-testing, isn’t necessarily a bad thing in terms of overall returns. Indeed, news-based trading approaches often beat market averages by increased margins during periods of higher volatility.

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Today’s Top Performer: American Electric Tech (NASDAQ:AETI)

Electric Hardware Firm Jumps 200%+ On News of Major Contract Win

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American Electric Tech provides “power delivery solutions” for the global energy industry: M&I Electric™ power distribution and control products, electrical services, and E&I construction services.

Today, they announced their receipt of a $14 million contract for a turnkey power solution, to be deployed in a new fractionation plant expansion project in Texas. Fractionation is part of the natural gas refinement process, whereby raw natural gas extracts are processed into commercially viable products. Their solution includes “M&I’s IntelliSafe™ medium voltage arc-resistant switchgear, low voltage arc-resistant switchgear, low voltage and medium voltage arc-resistant motor control centers, and medium voltage variable frequency drives, all integrated into three large M&I Power Distribution Centers (PDCs)”.

Investors are piling into the stock on the news: AETI is up a dramatic 225%+ since our initial news alert. “Contract Win” news events like this one can drive price momentum on multiple fronts. First, we have the first order of effect of $14 million in revenue: nothing to sneeze at. More fundamentally, the contract win provides longer-term evidence of the market value of AETI’s offering in their market space: they were selected by a sophisticated Engineering Procurement firm.

AETI hopes today’s news can change the firm’s market narrative: the firm has suffered a years-long fall since touching highs over $5 in summer, 2015.

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