SPECIAL NOTE: We’ve just released this quarter’s Ultimate Four report which includes four stocks our team believes have the greatest upside potential over the upcoming quarter. This latest report features favorite stocks from Neena Mishra, CFA, FRM, Madeleine Johnson, Ryan McQueeney and David Bartosiak.
Log on to Zacks.com to see these stocks today.The major indices will head into Friday’s session on positive ground for the week, as three straight days of advances have made up for Monday’s stiff decline.
The Dow increased 0.99% today to 24,505.2 and the S&P rose 0.69% to 2662.8. Both of these indices had recovered from the recent sell off yesterday. The NASDAQ, however, saw the sharpest decline on Monday of 2.74% due to President Trump’s criticism of Amazon and the ongoing trust issue with Facebook, so it had the hardest time getting back into the green. But it finally did offset the losses with today’s advance of 0.49% to 7076.6.
The market’s trade hysteria has calmed down significantly in the past few days on hopes that negotiations between the U.S. and China could ease tensions and avert a trade war.
Meanwhile, amid all the talk of tariffs and tech this week, there hasn’t been as much focus on economic data as there usually is at the turn of the month. We’ve seen solid numbers for ISM Manufacturing, ADP Employment and ISM Services in recent days, and tomorrow is the big Employment Situation report. If tariff concerns remain muted on Friday, then that jobs report could have a big say as to whether this week ends in the green or the red.
In the services, Dave added to two of his portfolios, picking up a chip company on sale in Blockchain Innovatorsand a retailer that’s breaking out in Momentum Trader. Technology Innovatorsbought a “FANG” stock that pulled back to a more reasonable price during the tech selloff, while also cashing in a double-digit winner. And finally, Value Investoradded two stocks that are down so far this year but should see better days ahead. Read about them all in the highlights section below:
Today's Portfolio Highlights:
Blockchain Innovators:With tech under pressure of late, the chips are on sale. In other words, some of the highest-ranked industries in the market are at discount prices compared to just a few weeks ago. Dave wants exposure to the space, so he added Taiwan Semiconductor (TSM) on Thursday. The company is a Zacks Rank #2 (Buy) that’s part of an industry in the top 2% of the Zacks Industry Rank. TSM attributes its strong results to demand from cryptocurrency miners…and it expects this demand to continue. Read the full write-up for more on this new addition.
Technology Innovators:Back when Netflix (NFLX) was at $315, Brian Bolan thought about buying it but decided it was too rich at that price. But the tech selloff pulled the stock under $300. With the “tariff tantrum” abating for now, the editor thinks this streaming giant is set to regain stable footing above $300. Therefore, he finally got the opportunity to add NFLX. Brian also sold NVIDIA (NVDA) on Thursday for a profit of approximately 12%. Learn more about both moves in the complete commentary.
Value Investor:Before earnings season really gets underway, Tracey decided to add a couple positions to the portfolio on Thursday. Both companies are down year to date on concerns about future revenue growth, but the editor likes their value characteristics so much that she’s willing to give them a chance.
Lithia Motors (LAD) is one of the largest auto retailers in the country, but is down 11.6% in 2018 on concerns over peak new car sales. However, earnings and sales are expected to climb 26% and 13%, respectively, this year and its shares remain “dirt cheap”. Tracey thinks it’s worth jumping into LAD right now ahead of its earnings report sometime in the next two weeks.
The concern for Beazer Homes (BZH) is, of course, the impact of rising mortgage rates, which have pulled shares lower by more than 14% year to date. But Tracey feels the selling is overdone, especially since BZH reported order growth of 10.4% in its fiscal first quarter. Plus, earnings are expected to grow 39% this year. The company reports next in early May. Check out the complete commentary for much more on both of today’s moves.
Momentum Trader:Shares of Urban Outfitters (URBN) are bumping up against their 52-week high. Dave is a big believer in shopping for breakouts right now, so it was a no-brainer to add a 12.5% position in this Zacks Rank #2 (Buy) specialty retailer. Momentum for URBN really picked up after it provided a strong guidance for the next quarter. The complete commentary has more on this new pick.
Counterstrike: "Markets were somewhat choppy today with an attempt by the bears to selloff early in the day. Since the bulls are back in control, buyers stepped in and took markets back to highs.
"Now we wait for the economic data tomorrow before we see our next big market move. Wage inflation will be what everyone is watching as traders try to guess what the Fed might do next."-- Jeremy Mullin
Until Tomorrow,
Jim Giaquinto