Stocks Plunge Further As Bank Fears Renewed

The stock market declined on Thursday as investors evaluated the Fed’s latest rate hike and the renewed bank worries.

Concerns on regional bank PacWest (PACW) weighed on regional banking sector during the day, as it tumbled 51%. The decline was due to the news that the bank has been assessing strategic options, including a possible sale.

Overall, S&P 500 was down 0.7% to 4,061, while NASDAQ shrank 0.5% to 11,966.

Tweet of the Day

Chart of the Day

Here is the ten-year chart of Fastenal (FAST) as of April 26, 2023, when the stock was at $52.

Fastenal is the largest fastener distributor in North America. Locations include stores the public can buy from and onsite locations, which are at the customer’s facility.

Fastenal saw solid sales and profit growth last quarter even though there was a modest contraction in demand for construction supplies. The company delivered 11% profit growth on 9% sales growth during the quarter. These are figures David Sharek would expect in a normal economic environment, which is a positive because the economy is slow right now.

In the earnings call, management said there was growth in demand in markets tied to industrial capital goods and commodities. FAST sees weakness from several major retailers, in its international business, and with its construction and reseller businesses. Manufacturing and large accounts continue to be strong.

FAST used to be in the Conservative Growth Portfolio years ago. David Sharek sold the stock, at around $37, as he felt it wouldn’t deliver 10% returns. Now it is on the radar and he is looking to get in on a dip.

Not a member? Sign up here for $25 a month.