After an ugly start to the week on Monday of last week, stocks rallied very impressively as the S&P 500 gained 4.6%, the Dow added 2.5% and the Nasdaq surged higher by 6.7%.

The past week or so definitely showed some very encouraging action, with one of the key “blastoff” indicators we track turning green on Thursday. So does that mean we’re off to the races? Well, we wouldn’t go there, at least not yet: The intermediate-term trend of the market and most stocks are still down, and it’s not unusual at all to see some near-term wobbles after this kind of blastoff signal. All in all, we think there’s enough good vibes to extend your line a bit—but we don’t advise buying hand over fist as we’re still looking to see added confirmation. We’ll bump up our Market Monitor two notches to a level 5.

This week’s list is full of resilient names, though many have earnings coming up, so be aware of those dates. Our Top Pick has a great story, great numbers and a resilient chart, with shares back near their highs after a bullish earnings reaction. Start small here or on dips.

It was a much better week for the market, and even more so our portfolio, as all but two of our existing 20 stocks were up at least 2%. Of course, there’s a lot of ground to make up from the damage done by “Liberation Day” at the start of the month, but it’s possible the market has turned a corner and a glorious month of May awaits for U.S. stocks. In case it doesn’t, however, today we beef up our overseas exposure by adding our first ETF in a while. It’s a fund just recommended by Carl Delfeld to his Cabot Explorer audience – and one that aims to take advantage of recent strength in European stocks.

Details inside.

After an ugly start to the week on Monday, stocks rallied very impressively as the S&P 500 gained 4.6%, the Dow added 2.5% and the Nasdaq surged higher by 6.7%.

After an ugly start to the week on Monday, stocks rallied very impressively as the S&P 500 gained 4.6%, the Dow added 2.5% and the Nasdaq surged higher by 6.7%.

Markets recovered some gains yesterday following a climb down on both stiff reciprocal China tariffs and speculation that Fed Chairman Jerome Powell might be fired. Explorer stocks had a good week with Luckin Coffee (LKNCY) up 9%, while DBS Bank (DBSDY) shares were up 7.7% this week following last week’s 6.9% gain.

Today, we add a new ETF with exposure to a very particular European sector that should be immune to the ongoing tariff wars.

Before we dive into this week’s covered call idea we need to address our stock positions coming out of April expiration, all of which we are going to sell as the market continues to be under pressure.

It’s been a tough market. The S&P started this week down about 6% for the month of April, over 10% YTD, and over 14% from the high. And that was before Monday’s selloff. It is entirely possible that the market falls back to a new low and an official bear market.

The tariff uncertainty is continuing, and it could get worse. A bad headline could roil the market any day. We’re not out of the woods yet. The market could get worse before it gets better. But it will get better at some point.

Investing for dividends and income is a longer-term proposition. Investors typically don’t jump in and out of these stocks in a short time. You have to hold the stock long enough for the dividend to make a difference. Although the market remains troubling in the near term, there are some great opportunities for longer-term investors.

The market continues to exhibit softness on persistent worries over (what else?) the tariff situation, and it’s clear that a re-test of the recent lows is underway. While there are some encouraging signs on the technical front, the primary evidence is still negative, with the major indexes remaining under their key trend lines. Bottom line: Patience will likely be needed before a sustained advance can develop. Accordingly, we’ll keep our Market Monitor at level 3.

This week’s list has a fair number of stocks that should be able to shake off tariff-induced headwinds. Our Top Pick is showing solid relative strength and has excellent potential in a fast-growing business.

Another down week – and down day – for stocks as tariff and inflation anxieties continue to run rampant. We may be headed toward a re-test of the post-Liberation Day lows from the beginning of the month. Fortunately, most of our stocks are holding up well, with no big losses in the last week despite a 4.3% decline in the S&P 500. In fact, a number of our stocks are thriving. Today, we add another stock that’s going against the grain of the market. It’s a new recommendation from Tyler Laundon to his Cabot Early Opportunities audience. It’s the kind of all-weather holding that can keep its head above water in this volatile market – and perhaps thrive if/when the tariff dam finally breaks.

Despite an onslaught of tariff headlines and rumors, the holiday-shortened week was mostly quiet outside of a nasty sell-off on Wednesday. By week’s end the S&P 500 had lost 1.5%, the Dow had fallen 2.7% and the Nasdaq had declined by 2.6%.

Despite an onslaught of tariff headlines and rumors, the holiday-shortened week was mostly quiet outside of a nasty sell-off on Wednesday. By week’s end the S&P 500 had lost 1.5%, the Dow had fallen 2.7% and the Nasdaq had declined by 2.6%.

Fourth-quarter earnings season is underway, and while expectations are high at an estimated 11.9% average year-over-year growth among S&P 500 companies, according to data collected by Factset, the actual numbers probably won’t matter much to the market’s short- and intermediate-term direction.

Ignore inflation numbers too. CPI and PPI – this week’s dual reports of the December results – were encouragingly cooler than expected. But in the end, what really matters is how they impact the Fed’s decision-making, which we probably won’t know until at least the end of the month.

Things are getting dicey in the market.


The problem is interest rates. Growth expectations are strong following the election. At the same time, inflation has been sticky and not moving lower. Investors were already expecting higher rates for longer when they got a gut punch with last week’s strong jobs report.

Uh oh. The rally is in trouble.

The market sort of wobbled into January after a rough December. It started good but things turned a little ugly last week after a better-than-expected jobs report and worries about sticky inflation.

In today’s note, we discuss pertinent developments and institutional ratings changes for some of the stocks in the portfolio, including Agnico Eagle Mines (AEM), Alcoa (AA), American Airlines (AAL), Atlassian (TEAM) and Toast Inc. (TOST).

Markets were closed yesterday in honor of the late President Jimmy Carter.

No matter your politics, the service was well done and inspirational.

It was a solid opening this first week of 2025: new recommendation American Superconductor (AMSC) shares were up 10%, Centrus Energy (LEU) shares were up about 8%, Cloudflare (NET) shares were up 7.5%, and Dutch Bros (BROS) shares were up 7.3%.

Here are my top eight predictions for the cannabis sector for 2025.

1. Cannabis rescheduling goes through

Promises made, promises kept. Trump loves a “deep state” challenge. Put these two together, and it seems probable that rescheduling could happen in 2025.

The market sobered up in December after a big post-election rally in November. The S&P fell 2.5% in the last month of the year. But January has started out with stocks up 2.2% already.

Technology is driving the market higher. The sector is taking off after Nvidia (NVDA) issued bullish statements about demand for its artificial intelligence chips. AI is a huge growth catalyst for the market’s largest sector and has proven it can drive the indexes higher all by itself. In fact, technology has been the primary catalyst for the S&P over most of this bull market. But things might be changing.

In today’s note, we discuss pertinent developments and institutional ratings changes for some of the stocks in the portfolio, including Alcoa (AA), Duluth Holdings (DLTH), SLB Ltd. (SLB) and the SPDR S&P Retail ETF (XRT).

The fabled “Santa Claus Rally” failed to appear this season, prompting concern for the early part of 2025 among many investors. We discuss what it entails for our investment approach.

WHAT TO DO NOW: Happy New Year! December’s weak action has created some decent setups and taken a chunk out of sentiment, both of which are good to see—but the underlying evidence hasn’t changed, with our Cabot Tides negative and few names heading higher. We came into the year with around half the portfolio in cash, and we’re remaining cautious today—our only change is placing Flutter (FLUT) on Hold.

The year 2024 was another great year for stocks. The S&P was up over 23% for the year. It’s a nice addition to the 26% return last year. It is the first back-to-back 20%-plus return years for the index since 1998.

But the year ended on a sour note. Usually, good years in the market finish strong. But not this time. True, the S&P 500 was down less than 2% in December. But that’s only because the big tech companies are still doing okay. The rest of the market had a terrible month.

It was a rare rough December for stocks.

Sure, the S&P 500 and the Nasdaq were down just over 2%, propped up as usual by enduring strength in the Magnificent Seven. But the losses were far greater in almost every other corner of the market, with 10 of the 11 major sectors declining, small caps tumbling nearly 8%, value stocks off by more than 6%, and energy and materials stocks retreating by double digits.

And we were having such a good time. Stocks were killing it in November after the election. But December turned out to be a real stinker.

Sure, the S&P 500 is only down about 1% over the past month. But that’s only because the big tech companies are still doing okay. The rest of the market is getting slapped around. Eight of the eleven S&P sectors are down in December. And many individual stocks are having a terrible month.

I’m recommending that we take a one-quarter profit in our position in real estate fintech Zillow (Z).

Sell Kaspi.kz (KSPI) and Vertex (VERX)

AST SpaceMobile (ASTS): Most Confusing Success Story Ever!?

Mama’s Creation (MAMA), our micro-cap grocery company that’s a play on the growth in deli prepared food, reported a solid Q2 after the closing bell yesterday that slightly surpassed expectations.

Placing Six Flags Entertainment (FUN) on a Sell

WHAT TO DO NOW: The market’s selloff this week is accelerating today, once again led by growth stocks. The Nasdaq is fully in re-test mode at this point, and while many stocks are showing some relative strength overall, we remain cautious given the selling with our growth-heavy indicators (Growth Tides, Aggression Index) looking poor. We sold TransMedics (TMDX) in last night’s issue, and today we’re going to cut bait with ProShares Russell 2000 Fund (UWM), which will leave us with around 49% in cash.

Solventum (SOLV), a spinoff of 3M’s healthcare business, was mentioned in last week’s CTL podcast.

On Tuesday morning I suggested traders might want to take some profits in positions accumulated the week before, because of a possible dearth of catalysts on the near-term horizon. I also suggested maintaining long-term exposure to the group.

Back on August 28 after the close, I shared bullish commentary on the cannabis group which was melting down at the time.

An updated portfolio for Cabot Options Institute – Earnings Trader.

An updated portfolio for Cabot Options Institute – Quant Trader.

An updated portfolio for Cabot Options Institute – Quant Trader.

An updated portfolio for Cabot Options Institute – Earnings Trader.

An updated portfolio for Cabot Options Institute – Fundamentals Portfolio.

An updated portfolio for Cabot Options Institute – Income Trader.

An updated portfolio for Cabot Options Institute – Fundamentals Portfolio.

An updated portfolio for Cabot Options Institute – Income Trader.

An updated portfolio for Cabot Options Institute – Quant Trader.

An updated portfolio for Cabot Options Institute – Earnings Trader.

An updated portfolio for Cabot Options Institute – Income Trader.

An updated portfolio for Cabot Options Institute – Earnings Trader.

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.