Although I usually let charts tell me where stocks are headed next, the current technical runes are a tad sunnier than I am at the moment. This is notwithstanding recent weakness that has caused new record highs that were within spitting distance just a few weeks ago to recede. A 3095 target that lay just 4.5% from early May’s peak now sits 10.5% away. It’s certainly do-able, but I doubt buyers have the moxie to turn things around as sharply as they did in December.
The failure of much-ballyhooed IPOs in Uber and Lyft to get Wall Street’s speculative juices going is a wet blanket shrouding the Street right now, the wetter because the bloated airbag called WeWork seems likely to lay an egg when it goes public. If it bombs, that would complete a bearish hat-trick of IPOs. The office-rental firm sported a $47 billion valuation in January, and although that is now looking like pie-in-the-sky, there’s no telling how severely the stock will be marked down when it starts to trade.
However, because WeWork’s nifty accounting tricks are even shadier than Lyft’s or Uber’s, and because investors have been in such a surly mode lately, we should look for WeWork shares to get savaged in the early going. With such a drubbing in prospect, it’s hard to imagine investors summoning the bravado to push the shares of Apple, Facebook, Boeing et al. into the ether, especially since all of those companies have serious problems of their own that have been widely reported.