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Schultz Retires From Starbucks

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After the opening bell strikes this morning, we expect new economic results for metrics such as PMI (Purchasing Managers Index), ISM Manufacturing and Job Openings for April. (The PMI and ISM reads will be for May.) Yesterday we saw a big drop in April Factory Orders — -0.8% from the expected -0.5%, and well down from the +1.7% posted in March. It’s the first piece of notably negative news we’ve seen in economic headlines since Q1 earnings season began to wind down.

Tomorrow morning we see new Trade Deficit, Productivity and Unit Labor Costs, all ahead of regular trading hours. These might be considered second-tier metrics to inform economic decision making, both among publicly traded companies and the U.S. government — federal, state and even local, especially after last week’s Q1 GDP revision and payroll/unemployment numbers. Those numbers were almost perfectly Goldilocks — growing, but not too hot — so analysts will be keeping tabs to see if those bigger headlines’ finding are borne out.

Big Tech has been roaring to start this week (and even going back to last week’s favorable jobs numbers), with Apple Inc. (AAPL - Free Report)  rising to new all-time highs and pushing even higher (+$192/share) in today’s pre-market. Apparently, concerns over a U.S.-China trade war are masking no impact on the world’s biggest gadget-maker, considering how much business it does in China. But even the Russell 2000 small-cap index, which contains plenty of tech-based niche companies, has been outperforming for the past couple weeks. So it’s not just the biggest names in Tech taking advantage at the moment.

Twitter  will at last become part of the S&P 500. While still selling well below its initial cost per share back when the company IPO’d five years ago, the social media mainstay looks to be on the upswing of its initial parabolic curve as a publicly traded entity. Currently, Twitter shares are rated a Zacks Rank #1 (Strong Buy), with 10 upward estimate revisions for this quarter and next. The company has an average earnings beat over the past four quarters of nearly 50%.

Finally, long-time CEO Howard Schultz has at last decided to end his tenure as the head of Starbucks (SBUX - Free Report) . After taking the coffee giant from a small Seattle-based company to an international powerhouse, speculation is that Schultz may be considering a run for president. While he would not concretely acknowledge this trajectory in an interview this morning on CNBC with Andrew Ross Sorkin, neither did he rule it out. In fact, there was plenty in his rhetoric that seemed massaged toward political pursuits.

If you’re interested in finding out whether Schultz is a Republican or Democrat, he considers himself an independent, as well as a self-styled centrist. That said, Schultz was a noted supporter of President Obama and his keystone accomplishment, the Affordable Care Act (ACA), aka Obamacare. Yet as a corporate head with a net worth of more than $2 billion, Wall Street interests would appear to be of Schultz’s main concerns. He has also received an award in his support of the state of Israel, which has been run by far-right conservatives for as long as Starbucks has been a household name.


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