Here are my key takeaways from Thursday's session:

• The market's main feature was the strength in Boeing (BA) , which buoyed the Dow Jones Industrial Average vis a vis the other indices.

• Banks, retail and industrials -- i.e. 3M (MMM) , Dow Inc. (DOW) and DowDuPont (DWDP) -- were the upside leaders.

• Bond yields slipped in a small way. The 10-year U.S. Treasury yield closed at 2.51%.

• Oil was flat to down, but gold climbed back to almost $1,300 (+$3).
  
  I'm exhausted from the last week and am going to call it a day. Thanks for reading and enjoy your evening!

Here are the bad actors:

* The lead investment bankers - JP Morgan, Credit Suisse and Jeffries - who placed the shares in bad hands, priced the deal too aggressively and failed to commit seriously to a syndicate bid.
* The business media spent much of the days leading up to the Lyft (LYFT) IPO on discussing the transaction. Though the coverage was repetitive and constant, from my perch, there was little there there in those discussions. Serious analysis in the business media was limited (or non existent) as glittering generalities were generously offered. Profoundly important issues facing LYFT and UBER were rarely discussed. The hoopla (and time devoted to the IPO) goosed the interest on the part of retail investors who got caught up with last week's shiny object - LYFT common shares.
* Retail investors who acted (avariciously) without forethought or analysis. Nothing new there - as individuals too often act first and think later (sometimes when it is too late).

As to the ramifications of the poor deal - unlike many - I view LYFT as a one-off and not having a terribly profound impact on the demand for future high tech IPOs.

Nor do I agree with those that say JP Morgan (a talking head just said Jamie Dimon really "needs this one" to work), in particular, will now come to the support of the deal in order to create a better reception for future initial public offerings.

Investment bankers do nothing more than provide merchandise to potential buyers. Too often it ends up in the hands of analytically-lite investors who give less thought to buying an IPO than they do in buying a refrigerator.

History rhymes and the tune is little changed from IPO to IPO and from cycle to cycle.

Caveat emptor.

Note: For what it is worth on March 27th I warned that I would avoid LYFT's shares after the initial lift and opening trade.

Retail is jiggy today.

I am working on the following columns for the next 1-2 days:

* A mention and discussion of my Yale lectures this week in Dr. Bob Shiller's class.

* My Bull/Bear Debate at Citigroup on Monday - chief strategist Tobias Levkovich asked a number of solid (and topical) questions and so did the audience of large institutional investors. I will note the questions and deliver my answers.

* The yield on the 10 year U.S. note hit 2.37% last week (close to my long standing target of 2.25%). Why I believe the drop to 2.37% likely fulfills my projection and, from here, rates are expected to slowly rise.

* What the domestic and global economy, and the trend of interest rates might mean for bank stocks in the months ahead.

* An update of my Buy Levels column.

No trades today.

As I have written, "Bad Is Not Good."
Just look at Germany's latest economic data.

Guggenheim raised its target for Twitter (TWTR) from $33 to $41 this morning.

My pal Peter Boockvar comments...bonds reflecting now, stocks reflecting late?

We've talked a lot about the differing messages that bond and stock markets have been sending about the economy and outlook. Maybe it's just as simple as the bond market curve flattening is just reflecting the current slowdown that is clearly upon us while the stock market is just believing it's temporary and a rebound in growth will occur in coming quarters. Quantifying the extent of the economic data disappointments in the US, the US Citi Surprise index fell yesterday to the lowest level since July 2017. For all major economies, it's getting close to the weakest since 2012. In contrast, the economically sensitive, internationally exposed US semiconductor index closed at a record high yesterday. Interesting times. 

US CITI SURPRISE INDEX

CITI SURPRISE INDEX for MAJOR ECONOMIES

SOX SEMI INDEX

Not that we need a reminder of the softness in overseas economic data, German factory orders in February fell by 4.2% m/o/m, well worse than the estimate of a slight increase of .3%. January was revised up by 5 tenths. On a y/o/y basis, orders fell by 8.4%, the 9th month in a row of declines and that is the most since 2009. This is a February number so hopefully it will turn in coming months if the China economic improvement seen in March is real but the German Economy Ministry spokesman said they expect orders will "continue to be subdued in the coming months, particularly due to a lack of foreign demand." The euro is little changed as a potentially below 1% 2019 economic growth rate in the Eurozone's largest economy has been expected. The German 10 yr yield though is back below zero and the DAX is little changed.

As expected, with low inflation and ahead of the upcoming election, the Reserve Bank of India trimmed interest rates by 25 bps as expected. The new Governor basically has now taken back the two hikes from last year initiated by the previous Governor. We talk here about the pressure President Trump is putting on Jay Powell. Well, in India the central bank Governor is a willing partner to the PM. While the move was expected, the Indian rupee is weaker vs the dollar and the Sensex fell .5% off a record high. PM Modi will win another 5 yr term but with likely a smaller coalition.

Meanwhile, Peter discusses the economic data released this morning:

Initial jobless claims remain very low. They totaled 202k for the week ended March 30th, 13k less than expected and down 10k from 212k last week. This brings the 4 week average to 214k from 218k last week. That's the lowest since early October. Continuing claims, delayed by a week, fell to the lowest since early January. 

Bottom line, even in the recent manufacturing and service numbers we're hearing still the difficulty of employers in finding the right employees. That certainly helps to explain still a low level in the pace of firing's.

4 WEEK AVG in INITIAL CLAIMS

"Your big opportunity may be right where you are now."
- Napoleon Hill (American author)

* I am substantially increasing my earnings estimates and price targets for Amazon.
* Amazon, the "Supreme Disruptor," has established an insurmountable first-mover advantage and a deepening competitive moat.
* Amazon's profit runway is lengthy and underestimated.
* Amazon will likely become the first $2.5 trillion company.
* AMZN is my largest individual long investment.

In the annals of U.S. corporate history there is no company that has as large and lengthy runway of opportunity as Amazon.com (AMZN) .

It is that prism of opportunity that supports my strong belief that Amazon's earnings growth will far exceed consensus expectations in the 2019-2022 period.

Here are the keys to my increasingly bullish case: 

1. Amazon's first-mover advantage is now impenetrable; the company no longer can be caught by its competitors.
2. Amazon's broad product offerings and technological advantages no longer can be duplicated.
3. Nor is Amazon likely to be caught by regulators. Indeed, the existential threatof more regulation and the possible imposition of growth constraints seem to be sharply diminished probabilities unless a progressive Democratic aspirant captures the White House -- an increasingly unlikely event. (See my prior discussion of this.) 
4. On the wings of a nearly zero cost of capital Amazon has expended enormous sums of capital to produce the massive and insurmountable competitive advantage that exists today. That "kindness of strangers"in such scale likely will never be duplicated again by a competing business entity, thus placing Amazon light years ahead of its competition. Indeed, in this marathon of disruptive growth (a marathon approximates 26.2 miles), Amazon is at least 20 miles ahead of its closest competitor.
5. Based on my company analysis, Amazon is about two years away from "hockey stick" earnings-per-share (EPS) growth that will far exceed consensus expectations. The source of my profit optimism and above-consensus growth projections are several fold, but are keyed on an expansion in operating leverage and profit margins produced by a lower rate of growth in expenses and higher top-line results. The latter will be aided by continued above-expected core retail sales gains and the anticipated success in the company's high-margin advertising initiative as well as other emerging businesses.
6. Based on our EPS models and our more optimistic assumptions of top- and bottom- line growth, I anticipated that EPS results for 2019, 2020 and 2021 will exceed consensus forecasts by more than 10% in each of those years -- and possibly considerably more! Also, 2021 is the year when the largest gain relative to expectations is projected. With more than one quarter of this year already in the rear-view mirror, it is not too early to consider results out two years.
7. The shares of Amazon have not been materially embraced and exploited relative to other peer stocks by institutional investors. As an example (and anecdotally), in my Bull/Bear debate with Tobias Lefkovich at Citigroup on Monday, the audience of large institutional investors was asked how many held the shares of Amazon. Only five out of about 30 investors answered the question affirmatively.
   In terms of the other three FANG constituents, Amazon has the lowest component of institutional ownership: Institutional Ownership as a Percentage of Shares Outstanding
   
   Facebook 75%
   Amazon 57%
   Netflix 77%
   Google 81%
8. In emphasizing Amazon's retail, emerging business and operating/financial strengths, I have not even discussed AWS cloud services, which I will save for a further discussion. It's the icing on the cake. 

Background

After a series of forays on the short side (some profitable, some unprofitable) over the last few years, I purchased Amazon in late December and added the stock to my Best Ideas List as a long on Dec. 26, 2018, at $1,383. The shares are currently trading at about $1,820. I cited:

"Amazon's business franchise is secure and getting stronger. The competitive threats seem surmountable, and its market share appears to have a widening moat. The company's shares have also already materially discounted a modest threat of heightened regulation, which no longer seems as very threatening in any case."

- Kass Diary, "The Case For Amazon"

At that time, the broad markets were in disarray, there were concerns about the company's previous reporting quarter and the divorce of CEO Jeff Bezos raised vague questions about company control. 

Bottom Line

"If a window of opportunity appears, don't pull down the shades."
-- Tom Peters 

With the risk of the company's growth expansion plans no longer in jeopardy, Amazon's competitive position is firming and its business moat has deepened. Its first-mover advantage and lead has multiplied over time and the company's competitive reach is not likely to ever be challenged. 

It is now likely that a "hockey stick" in EPS results will gather speed over the next three years and that the company will produce sales and profit growth that substantially exceed investors' expectations.

I expect that Amazon, in the fullness of time, will become the first $2.5 trillion company.

Sometimes the best investment opportunities lie right in front of us, and Amazon might be the best example of this phenomenon today.

When I was out over the last week there were increasing signs of slowing economic growth.

From Danielle DiMartino Booth: 

VIPs

• The ISM Non-Manufacturing index covers everything in the economy except manufacturing while Markit's Services index is much narrower in scope; with its wider breadth and longer history, ISM's data should be favored to approximate GDP growth but Markit's prevails
• Neither ISM Non-Manufacturing nor Markit's Services have a perfectly predictive track record in forecasting GDP growth; ISM's correlation is .36 while that of Markit's is a relatively tighter .63
• Markit moved in closer alignment to the 2015-16 slowdown vis-a-vis ISM; whereas Markit pegged the February 2016 bottom, ISM didn't trough until August 2016
• Soft data from surveys usually lead hard data; as such, the ISM suggests the U.S. economy will slow through the first quarter to a 2.1% rate while that of Markit indicates a slowing to 2.6%, both of which exceed Macroeconomic Advisors' historically reliable 2.0% projection
• Slower growth in the labor-intensive services sector should manifest in slower job growth; the ADP employment report corroborates this dynamic as cyclical soft spot sectors slid to a three-year low

Three from Rosie:

Another great memorandum from Howard Marks of Oaktree Capital.