SPECIAL ALERT: Remember, the latest episode of the Zacks Ultimate Strategy Session will be available for viewing no later than this Wednesday, May 13. Kevin Matras, David Bartosiak, Dr. John Blank and Sheraz Mian will cover the investment landscape from several angles in this informative event.
Don’t miss your chance to hear:
▪ Sheraz and John Agree to Disagree on whether Coronavirus issues are the only things that matter to stocks or if other issues matter
▪ Kevin answers why stocks are going up when the economic reports are so bad in Zacks Mailbag
▪ Sheraz and David choose one portfolio to give feedback for improvement
▪ And much more
So be sure to mark your calendar then log on to Zacks.com and bookmark this page.
The major indices mostly recovered from a morning selloff on Monday, as technology continues to carry this market on its shoulders.
The NASDAQ now has a six-day winning streak after rising an additional 0.78% (or about 71 points) today to 9192.34. The index is now in the green for 2020 by well over 2%.
All of the FAANGs were higher once again with Apple (NASDAQ:AAPL, +1.6%) leading the way. Other stocks from this group also advanced more than 1%, including Amazon (NASDAQ:AMZN, +1.2%), Netflix (NFLX, +1.1%) and Alphabet (NASDAQ:GOOGL) (GOOG, +1%). Microsoft (NASDAQ:MSFT) eclipsed 1% as well.
The S&P (NYSE:SPY) just barely closed higher with an advance of 0.02% to 2930.32, but the Dow couldn’t join its counterparts on the plus side and slipped 0.45% (or about 109 points) to 24,221.99.
However, the Dow did come well off its lows of an approximately 260-point deficit and got its head above water momentarily in the session.
The market’s resilience of late has been impressive to all and concerning to some. Stocks are coming off a solid weekly performance with the NASDAQ soaring 6% and the S&P and Dow up 3.5% and 2.5%, respectively.
And these performances came during a week that saw three consecutive days of horrible jobs reports, concluding with the employment situation on Friday that saw the unemployment rate soar to 14.7% after losing over 20 million jobs in April.
The market remains in a hopeful mood for the most part, even though we’re equal parts excited and nervous of the country slowly beginning to re-open without a vaccine or widespread testing.
This week won’t be as jam-packed as the past few, which may have been underscored in the low volume on Monday. But everyday is unpredictable right now and we will be hearing from Fed Chair Jerome Powell on Wednesday.
So let’s see if the market can stay strong in the days ahead as we try and get this economy back on its feet.
Today's Portfolio Highlights:
Surprise Trader: In a rising market like this one, sometimes an investor has to chase. Dave has been doing that A LOT recently and it continued with today’s addition of Sapiens (SPNS). This provider of IT solutions has a positive Earnings ESP of 7.14% for the quarter being reported before the bell on Thursday. Expectations of 19 cents suggests year-over-year growth of more than 13%. SPNS was added with a 12.5% allocation. The portfolio also decided to sell Biotelemetry (BEAT) after this ambulatory outpatient management solutions company slipped to a Zacks Rank #4 (Sell). The position still brought a positive return of 7.6% in less than three weeks. Read the full write-up for more on today’s moves.
ETF Investor: Remote working is all the rage in this virus-induced shutdown, which means cloud companies have surged in demand. And this isn’t likely to end when things get back to normal. People and businesses now realize that working from home can be just as effective as being in the office… and sometimes more so. Neena already has some cloud exposure in the portfolio, but this new environment calls for more. On Monday, she added WisdomTree Cloud Computing ETF (WCLD), which holds companies that derive a majority of their revenues from cloud computing software products or services. In less than a year, it already has over $70 million in assets. The editor likes this name because it offers more exposure to smaller, emerging, faster-growing cloud companies than the portfolio’s other position. Read the full write-up for more.
Black Box (NYSE:BOX) Trader: The portfolio switched out six positions in this week’s adjustment. The stocks that were sold today were:
• Yum China Holdings (NYSE:YUMC, +5.9%)
• General Mills (NYSE:GIS, +4.8%)
• Dollar General (NYSE:DG, +1.5%)
• Kimberly-Clark (NYSE:KMB)
• J.M. Smucker (SJM)
• Scorpio Tankers (NYSE:STNG)
The new buys that filled these open spots included:
• Berry Global Group (NYSE:BERY)
• BG Foods (BGS)
• DaVita (NYSE:DVA)
• Nomad Foods (NYSE:NOMD)
• Sprouts Farmers Market (NASDAQ:SFM)
• Teekay Tankers (NYSE:TNK)
Read the Black Box Trader’s Guide to learn more about this computer-driven service designed to take the emotion out of investing.
Counterstrike: "All signs are pointing to continued momentum higher. The tech stocks are simply on fire and the VIX has cracked 30. Fear is being sucked out of the market and FOMO is coming back in. While this is usually the sign to play the short side, the recent reversals on every gap lower are making that difficult.
"2900 is the line in the sand where the battle is being fought. So far, the bulls are winning in this low volume atmosphere. However, I do wonder if bad news and volume will come and give the bulls a nice shakedown.
"It will be an interesting week ahead with Powell speaking Wednesday and global economic data coming all week. While volatility is dying, always be prepared for a quick return." -- Jeremy Mullin. By the way, this portfolio had the best performer of the day among all ZU services as Zynex (NASDAQ:ZYXI) jumped 17.3%.
All the Best,
Jim Giaquinto
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