The S&P 500 broke back above the 6,000 level for the first time since February last week as the indexes are now within striking distance of their all-time highs (though they do have some work to do). By week’s end the S&P 500 had gained 1.5%, the Dow had rallied 1.2% and the Nasdaq had advanced by 2.2%

The S&P 500 broke back above the 6,000 level for the first time since February last week as the indexes are now within striking distance of their all-time highs (though they do have some work to do). By week’s end the S&P 500 had gained 1.5%, the Dow had rallied 1.2% and the Nasdaq had advanced by 2.2%

Most companies that were hit hard by Covid have recovered and then some. Many are faring better than ever. But because of investors’ narrow focus on the Magnificent 7 and a handful of artificial intelligence stocks the last two and a half years, share prices across various sectors have not kept pace with revenue and earnings growth. In recent months, we’ve capitalized on that discrepancy by pouncing on United Airlines (UAL), The Cheesecake Factory (CAKE) and, just last month, Carnival Corp. (CCL), with great success.

This month, we hope to mine another quick double-digit winner from the industrials sector. It’s a company that’s thriving like never before, but there’s been a significant lag between the fundamentals and the share price. We hope our timing in adding it to the portfolio now can produce UAL- or CCL-like rapid returns.

Details inside.

Explorer stocks are either steady or performing well with Dutch Bros (BROS) shares up 18.4% during the last two weeks and Luckin Coffee (LKNCY) shares jumping 9.4% this week after a strong first quarter with 41% year-over-year revenue growth.

In addition, Singapore’s Sea Limited (SE) shares are up 18.6% during the last two weeks, and Spain’s Banco Santander (SAN) shares have surged 73% so far in 2025. China’s BYD (BYDDY) shares are up 53% in 2025. New silver and gold play Coeur Mining (CDE) shares were up 13.5% in their first two weeks in the portfolio.

Today’s new addition is a consumer-oriented stock with a range of shooting devices that are quickly becoming the must-haves among sportsmen and those looking for a less lethal self-defense option.

Revenue growth and profitability are on the rise, buoyed by new retail partnerships, domestic manufacturing and the launch of the company’s newest device.

All the details are inside this month’s Issue.

Enjoy!

Coming off a losing week two weeks ago, the indexes mostly regained that lost ground last week as the S&P 500 gained 1.9%, the Dow advanced 1.6% and the Nasdaq rallied 2%.

There’s little doubt the news has gotten worse, with the U.S. debt downgrade, renewed U.S-China trade tensions, another hike in steel tariffs announced last week and a big pickup in war uncertainty over the weekend … but so far, the market has handled itself decently, with some wobbles (mostly among the broad market) but overall a quiet-ish consolidation compared to the recent run-up. To be fair, that can always change, but given everything, we’re pleased with the action thus far. We’ll again leave our Market Monitor at a level 7 as we wait to see which way the market breaks from this tight range.

This week’s list has a ton of overall strong charts with recent tightness, just like the market. Our Top Pick is a steadily growing emerging blue chip in the software space that just left behind an endless consolidation with a powerful earnings gap.

The market has become a bit stagnant and boring. After the last few months we’ve had, boring is good. So today, we lean into the boring theme by adding a “boring” stock to the portfolio. It’s a mid-cap insurance company that Tyler Laundon recommended to his Cabot Early Opportunities audience last month. It may be boring, but like the market, it has plenty of upside in the near term.

Details inside.

Coming off a losing week two weeks ago, the indexes mostly regained that lost ground last week as the S&P 500 gained 1.9%, the Dow advanced 1.6% and the Nasdaq rallied 2%.

Coming off a losing week two weeks ago, the indexes mostly regained that lost ground last week as the S&P 500 gained 1.9%, the Dow advanced 1.6% and the Nasdaq rallied 2%.

The market has handled itself well during the past couple of weeks, consolidating normally, with our intermediate-term indicators still positive, which is all to the good. Still, leadership remains somewhat lacking and, while coming close, our Cabot Trend Lines are still negative, so we’re content to take things step by step while waiting for more institutional-quality names to get going. Tonight, we are extending our line a bit more, but will hold onto a 36% cash position and want to see added upside confirmation before we put too much more money to work.

The Senate Judiciary Committee recently approved the nomination of Terrance Cole to lead the Drug Enforcement Administration (DEA).

The full Senate may vote on Cole’s confirmation as soon as early June.

This could be the start of a significant turning point for cannabis stocks. That’s because Cole will address a Biden-era proposal to move cannabis to Schedule III from Schedule I under the Controlled Substances Act (CSA). The change would significantly enhance cannabis company cash flow by neutralizing an IRS rule that bars operating expense deductions against revenue from the sale of Schedule I substances.

Trump’s victory has given the S&P 600 SmallCap Index the jolt it needed to break out above this year’s overhead resistance at 1,465.

This is what it looks like on a daily chart going back about a year ...

The rally since the election continues as Bitcoin reached $90,000 for the first time. Tesla (TSLA) has climbed more than 40%, and the KBW Nasdaq Bank Index, which tracks shares of some of the nation’s largest lenders, is surging.

Dutch Bros (BROS) shares jumped 36% this week as it beat analysts’ expectations on the top and bottom lines while offering improved guidance for the remainder of 2024. Sea Limited (SE) soared 10.3% as the Singapore-based company reported overall net income that beat estimates at $153.3 million, with a better-than-projected 31% rise in revenue for the September quarter.

The honeymoon phase for a second Trump term continues on Wall Street. Stocks are up 3.5% in the week since Trump won the election, with all three of the major indexes advancing to new all-time highs. The reaction is being framed as specific to Donald Trump and his potential influence on stock prices – the so-called “Trump Trade” – but in reality, this is nothing new.

In recent years, there’s always been a honeymoon phase for stocks after a presidential election – regardless of which party or candidate won. And it typically lasts until the newly elected president’s inauguration in late January.

Donald Trump was elected President last Tuesday, and the market posted the best week of the year. The S&P 500 soared about 5% in the three days following the election.

Investors perceive his election will deliver stronger economic growth, primarily through deregulation and tax cuts. Although interest rates spiked higher on the expectation of a stronger economy, the market views the revised prognosis as overwhelmingly bullish, so far.

In today’s note, we discuss a number of earnings results and new developments for several of our portfolio positions, including Alcoa (AA), Atlassian (TEAM), Barrick Gold (GOLD), Viatris (VTRS), and Pan American Silver (PAAS).

Continued strong earnings reactions this week bode well for several of our recent portfolio additions.

WHAT TO DO NOW: Remain bullish. The market has reacted well to the election and took today’s Fed decision in stride; both of our trend-following indicators are bullish and leading growth stocks remain in good shape. Today, we took partial profits in AppLovin (APP) via a special bulletin after it went vertical on earnings. But tonight, we’re putting that and a bit more money back to work via two new positions—starting half-sized stakes in Samsara (IOT) and the ProShares Ultra Russell 2000 Fund (UWM), leaving us with a cash position around 18%.

The cannabis sector is taking a severe body blow because of election outcomes.

The big negative: Florida voters rejected Amendment 3, which would have legalized recreational use. Voters in North Dakota and South Dakota also rejected cannabis legalization.

The election is over. The biggest risk, a disputed outcome, has been avoided. The new President is being viewed by markets as generally good for business and stocks. The market is thrilled today and rallying substantially.

It’s all about the election right now.

The massive political event is sucking all the oxygen away from everything else. It’s worth noting that the Fed will meet and likely cut the Fed Funds rate this week. That will be the focus after the election is resolved, if it’s resolved.

I don’t get into the business of predicting political outcomes. That’s not my horserace. As of now, the markets seem to be leaning toward a Trump victory. That appears to be the more likely bet. But all that stuff favored Hillary even more so in 2016. We’ll see what happens.

In today’s note, we discuss a flurry of key news developments for several of our portfolio positions, including Agnico Eagle Mines (AEM), Atlassian (TEAM), Intel (INTC) and Janus Henderson Group (JHG).


Two strong earnings reactions after Thursday’s market close bode well for two of our recent portfolio additions.

The broad market has been resilient up until today when we see Microsoft (MSFT) leading the Nasdaq lower.

That said, small caps are hanging tough and are almost exactly flat over the last week.

The darn 10-year yield is still up, which signals the market thinks the Fed did not need to cut by 50bps in September. I’m increasingly dubious about a rate cut next Thursday, even though the market is saying there’s a 95% probability of a cut.

We need to begin with some bad news. Super Micro Computer (SMCI) stock tumbled 32% yesterday after its audit firm, Ernst & Young, resigned. The auditor said it had recently learned of information “which has led us to no longer be able to rely on management’s and the audit committee’s representations, and to be unwilling to be associated with the financial statements prepared by management.”

Today we are going to close our two Bear Call Spreads (QQQ and SPY) in the Quant Trader portfolio. Here are the details:

All-Weather Portfolio Alert (GLD, IEF, VTI, TLT, DBC), Buffett’s Patient Investor Portfolio Alert (AAPL, GOOGL, TXN), Cabot Options Institute Fundamentals – Yale Endowment Portfolio Alert (SPY, EEM, VNQ, TIP, EFA)

Cannabis stocks rallied hard Monday, particularly after the close when we learned that the Florida Supreme Court approved a referendum on legalizing the sale of cannabis for recreational use. Florida already permits medical use, but the change would expand the size of the Florida cannabis market significantly, especially considering Florida’s large tourist industry.

Sell Varonis (VRNS)

Just a quick heads up, I’ll be adding several new positions early next week. We currently have four positions in the portfolio and my immediate goal is to get back up to between six and eight positions using our ladder-based approach for consistent, weekly income.

Dogs of the Dow Portfolio (DOW), Buffett’s Patient Investor Portfolio Alert (GOOGL)

After a surprising gap higher, MMM has continued to follow through with its recent trend higher, with nary a pullback. As a result, we need to buy back our calls and once again extend our deltas back into positive territory.

I’m adding another new bear call spread to the mix and intend on adding several more trades over the coming days.

WHAT TO DO NOW: The market and especially leading stocks are still very choppy, with news-driven moves becoming the norm of late, and today we’re seeing another wave of selling in the names. Big picture, we’re still optimistic, but we’re taking things on a stock-by-stock basis at this point. Today we’re going to sell Shift4 (FOUR), which was hit hard yesterday after saying it received no worthwhile buyout bids and, without any bounce, we’re going to cut bait here, leaving us with 32% in cash. Details below.

I want to lock in a return and look to sell more put premium in XLU over the next few trading days. By locking in a return in XLU, our total returns for Income Trader will exceed 160% for the first time since inception.

Shares of Elastic (ESTC) continue to struggle in the weeks after reporting earnings. We sold part of our position on March 5 for a 30% gain, and we’ll sell the rest today for a roughly 22% gain. SELL REMAINING SHARES

Today, a whopping eight Profit Booster positions will expire. Most are “slam-dunk,” full-profit trades, while others will go down to the wire.

The big takeaway, before we dive in, is we are going to let the situation play itself out, and come Monday/Tuesday of next week we will revisit our profits, as well as how we will manage the remaining positions.

A few Cabot Options Trader subscribers have asked me about ways to protect gains in their portfolios, so I thought I would write to everyone with a couple of strategies using options to hedge your portfolio.

A subscriber recently asked me if I keep a journal of my trades. Many traders keep journals so they can look back at their trades and evaluate what they did right and what they did wrong.

Want to know how the big institutional investors use options? Here is an example of how one trader spent $132 million on three technology stocks.

Options trading has its own vernacular. To know how to do it, you need to know what every options term means. Here are some of the basics.

Our Cabot Top Ten Trader’s market timing system consists of two parts—one based on the action of three select, growth-oriented market indexes, and the other based on the action of the fast-moving stocks Cabot Top Ten features.