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S&P 500 headed to 2,500, courtesy of Japan?

November 12, 2014

Stocks finished a smidge higher Tuesday in a session so quiet that you felt compelled to check your Internet connection because it seemed like prices just were not moving. Knock,... Continue Reading »

Homebuilders are knocking on the door again

October 21, 2014

There are some groups of stocks that are the never-ending object of our attention for months and years on end, and then something happens and you gradually stop looking —... Continue Reading »

'Ebolatility' infects stocks, sparks bonds

October 16, 2014

Stocks keeled over on Wednesday like sawgrass in a stiff wind, bending and trembling but never actually breaking. There was a list of catalysts as long as your arm, even... Continue Reading »

Daily Issues

Trades Update

December 17, 2014

Stocks rallied on Wednesday, recouping much of their prior losses, thanks to a rebound in crude oil and in the Russian ruble, as well as this month's FOMC announcement. The latter included additional language from the Fed about remaining 'patient in beginning to normalize the stance of monetary policy.'

The impact on stocks was swift and sharp: the S&P 500 gained more than 2% on these headlines, as did the Nasdaq, while the Russell 2000 small-caps gained 3.1% and the Dow gained 1.7%. In today's Trader's Advantage, I'm adding several new buys in blue-chip stocks to see us safely through year-end, and I'll update you on our current holdings, which did quite well in today's rally.

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Trades Update

December 16, 2014

It was another volatile day on Wall Street: stocks gapped down at the open, turned sharply higher in the late morning and then pivoted again, sliding back down to a 0.8% loss for the S&P 500, a 0.6% loss for the Dow and a whopping 1.2% loss for the Nasdaq. The Russell 2000 small-caps fared better, ending about flat on the day.

Oil prices continue to dominate the headlines, with West Texas Intermediate crude following a similarly choppy pricing pattern throughout Tuesday's session, ultimately settling just under $56 per barrel. In today's Trader's Advantage, we took profits on an option trade and entered a new stock trade as well; I'll review both of those positions and provide my latest recommendations, including one new trade on a major Pentagon contractor.

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Investors Flinch About the Connection Between Crude and Credit

December 15, 2014

Stocks ripped lower again on Monday without much by way of a catalyst, though to be sure the epic plunge in crude oil prices certainly seems to be playing a role in dampening sentiment for stocks. Economic data were mixed and had little impact, as better than expected industrial production data and weaker than expected New York area manufacturing data kind of canceled each other out.

If there is one flow of information that is most disturbing, it is the behavior of high-yield credit, or perhaps I should say misbehavior. Junk bond indexes are crashing because investors fear that overleveraged small oil and gas producers will default on high-yield loans and leave holders hanging. But outside of energy and small-caps, the market is not really doing all that badly. I have a new idea for you to consider, as I suspect the selling will abate in coming days and you will be happy to acquire some new positions on this swing lower.

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Poll

Which of the following sectors of the market do you think will outperform for the balance of 2014?

  • Utilities
  • Energy
  • Healthcare
  • Technology
  • Financials
  • Industrials
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