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Earnings season is upon us and was the key driver of the dismal stock market action this week. With the exception of a few companies like flooring products company Mohawk Industries (MHK), which is still benefiting from strong demand and has managed to pass on high input costs to its customers, most stocks were hit hard after earnings including stalwarts like Amazon.com (AMZN). The Nasdaq was down more than 4% today and pulled back 13.26% this month, its worst monthly drop since the Great Recession.
The week started off with news of a definitive merger agreement signed by Elon Musk to acquire Twitter (TWTR) in an all cash deal worth $54.20 per share. We have a separate section dedicated to Twitter this week. With Twitter trading at $49.02, the spread on the deal is now over 10%.
Voluntary Disclosure: I hold a long position in Twitter (TWTR).