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Bonds or bond funds should be part of most investors’ portfolios or retirement plans because of the predictable income they generate. But with interest rates vacillating wildly, let’s take some time to explore how that impacts bond investors and some strategies you can employ to optimize your fixed-income returns.

The population is aging. And it’s aging at warp speed. People 50 years of age and older now comprise a third of the U.S. population. The fastest growing segment of the population is 65 and older as an average of 10,000 baby boomers are turning 65 every single day. And it’s not just this country – aging is a global phenomenon.

We don’t know how sticky inflation will be or what the Fed will do. We don’t know if there will be a recession this year or next year or what the recovery will look like, or who will be the next president. But we do know that the population is shifting and companies on the receiving end of the torrent of dollars that will flow as a result should benefit mightily.

In this issue, I highlight another new stock to buy. This stock is cheap with strong momentum and properties that should help it perform well in any kind of market. It’s a healthcare stock ahead of a huge megatrend, the aging population.

Investing with the tailwind of a megatrend makes it so much easier to make a successful investment. It makes mediocre stocks great and good stocks one of your best investments ever.

With airline and cruise bookings eclipsing pre-pandemic levels, it appears that vacationers’ pent-up travel demands are finally being unleashed in this “revenge travel” summer. Here’s how you can save money as you tick a few items off your own travel bucket list and profit from the most in-demand travel companies.

The market still has many of the same issues that have been hanging around for weeks, including an extreme narrowness, with the vast majority of the market struggling while mega-cap indexes do pretty well. Even so, we do think the evidence has taken a step in the right direction -- the AI boomlet is a positive sign, and many non-AI leaders acted well in May and have rested normally since. We’re not flooring the accelerator, but given our monstrous cash position, we’re dropping a couple more lines in the water tonight, adding two half-sized stakes in old favorites.

Elsewhere in tonight’s issue, we give our thoughts (and some ideas) within the AI advance, write about a long-term growth area that could be re-emerging and, as always, go over our stocks, an expanded watch list and some other new ideas to chew on.

Markets have been sideways in the past month, affected by wars, upcoming elections, and analysts see-sawing on the possibility of a Fed rate reduction. The Federal Reserve is meeting this week, and predictions for a rate cut this year are all over the board: none, one, or two.

I expect we’ll have more volatility as we near the fall election cycle.

In the meantime, economic stats look good! Manufacturing continues to climb, jobs are still being added at a rapid pace (272,000 vs. the estimate of 190,000), and the unemployment rate—at 3.9%—remains steady.

After some choppy action the prior two or three weeks with defensive stocks leading, growth stocks and many major indexes have improved their standing - including the strongest names continuing to zoom higher. Now, near-term, there are some uncertainties, with earnings season and the election coming up, and there are still areas (including the Nasdaq itself) that are still battling with old resistance. Thus, we wouldn’t be shocked if extended names shook out a bit. But overall, we’re still leaning bullish, though are picking our spots; tonight we’re starting one more half-sized stake in a familiar name we think can do very well should the bulls remain in charge.

Spooky season is upon us! Yes, the usual October selling has commenced, although it’s been fairly mild thus far. But things feel unsettled, what with the expanding war in the Middle East, a toss-up presidential election less than a month away, and with earnings season getting underway this week. So today, to counter any further turbulence, we trim one modest laggard and add a new, low-beta, dividend-paying European stock that’s been a favorite of Cabot Explorer Chief Analyst Carl Delfeld for some time.

Details inside.

While the outlook for 2025 is positive, things are changing.

Sure, this bull market has driven the S&P 500 nearly 70% higher. But most of the gains are from technology stocks. Until this past summer, nearly all the bull market returns were driven by technology. The rest of the market had done very little.

But the rest of the market is waking up. While artificial intelligence (AI) will likely continue to be a powerful growth catalyst, its dominance over everything else might not be as pronounced in 2025 as it has been in the past. Earnings for other stocks are catching up.

The earning growth difference between the “Magnificent 7” companies and the other 493 S&P 500 companies is expected to plummet from 27.8% last year to 8.3% this year. The rest of the market is cheap, has momentum, and will likely get hot this year as stocks experience an earnings growth spike that could last for years.

In this issue, I highlight a healthcare stock that looks highly promising in 2025. It is poised in front of the aging population megatrend, which makes a successful pick so much easier, and it will likely experience a sizable earning spike in the years ahead. It is an existing portfolio stock of which half the shares were sold last year. It’s a great time to buy back the other half.

After an unusually eventful start to the month, stocks have settled into their normal pre-Labor Day malaise. It won’t last long. Early September typically brings a round of selling as Wall Street returns from vacation and starts culling laggards from their portfolios. But with a Fed rate cut now definitely coming just a couple weeks later, could this be a more constructive September than normal? We’ll see. In the meantime, let’s try and sidestep the coming volatility by adding an undervalued mega-cap tech stock that’s well outside U.S. borders. It’s a former market darling that’s become unloved in recent years. But new Cabot Turnaround Letter Chief Analyst Clif Droke spots a bargain, and so today we add it on the cheap to our Cabot Stock of the Week portfolio as well.

Details inside.

Stocks are rolling again, and the panic that engulfed the market just two weeks ago has vanished, replaced by the longest market winning streak all year. Nearly all our Stock of the Week stocks are up in the past week, several of them by double digits, led by AST SpaceMobile (ASTS) – up more than 80% (!) since we last wrote. So, let’s strike while the iron is hot and add another upstart growth stock to the portfolio in the form of a mid-cap just recommended by Carl Delfeld in his Cabot Explorer advisory.

Details inside.

After weeks of withstanding a geyser of negative headlines – higher inflation, tariffs, slower interest rate cuts, the DeepSeek impact on AI, etc. – the market finally took on water last Thursday and Friday. Whether that’s the start of a deeper correction, we’ll likely know in the next few days. Even if it is, it’s nothing abnormal. After all, the S&P just touched new all-time highs three trading days ago. A pullback was probably inevitable.

Out of respect for the about-face in U.S. stocks in recent days, however, today we’ll turn our attention to Europe, where stocks have been outperforming their U.S. counterparts by more than 2-to-1 so far this year. Our new addition comes from Spain and is a company that’s been in Carl Delfeld’s Cabot Explorer portfolio for several months.

Details inside.

Cannabis investors continue to await action by the Trump administration on rescheduling, the next potential major catalyst for the group.

In an August 11 news conference, President Donald Trump said that he’s still considering the change and he will have a decision within a few weeks.

I believe Trump will follow through on his promise to reschedule, but this is not a 100% certainty. The most likely outcome, in my view, is that the Department of Justice will cancel a planned rescheduling hearing and issue a final rule with a public comment period.

Current Market Outlook


The market found some buying support after this morning’s gap lower, as some investors believe the Fed might stay on hold for longer considering job growth has slowed. That was good to see, but, daily wiggles aside, the intermediate-term trend remains sideways, which means staying selective, holding some cash and honoring your stops is paramount. There are still plenty of stocks working and a few set-up nicely, and that’s where your focus should be.

This week’s Top Ten presents a bunch of current winners; all have held up well during the market’s recent selloff. Our Top Pick is Carmax (KMX), which popped out of a nice, flat base on earnings last week.

Stock Name	Price	Buy Range	Loss Limit
58.com (WUBA)	0.00	49-51	45-46
United Therapeutics (UTHR)	0.00	170-175	160-162
Medivation (MDVN)	0.00	125-130	116-117
CarMax (KMX)	0.00	72-75	67-68
Horizon Therapeutics (HZNP)	49.89	24.5-26	21-22
Humana Inc. (HUM)	0.00	175-179	158-162
Diamondback Energy (FANG)	0.00	75-78	67-69
E*Trade Financial (ETFC)	0.00	26.5-28	24-25
D. R. Horton (DHI)	66.55	27.5-28.5	25.5-26
Cirrus Logic Inc. (CRUS)	0.00	31.5-33.5	29.5-30

The market and many leading stocks finally hit some resistance today, but we can’t say that’s too surprising—the market has had a great run in recent weeks, there hasn’t been any real dip since mid-May and earnings season is just around the corner. We’re not shrugging off today’s selloff; if the evidence rapidly deteriorates, we’ll change our tune. And as we’ve written lately, booking partial profits in some winners makes sense ahead of earnings season. But just as one big day off the bottom doesn’t signify a new uptrend, we can’t say one bad day has changed the overall uptrend.

This week’s list is as growth-oriented as we’ve seen it in a long time, and it includes a few stocks that only recently broke out of bases. Our Top Pick is Baidu (BIDU), a blue-chip Chinese stock that has been acting very well in recent weeks. Earnings are due out July 24, so try to buy on dips.

Stock Name	Price	Buy Range	Loss Limit
58.com (WUBA)	0.00	52-54	45-46.5
Nabors Industries (NBR)	0.00	28-29.5	26-26.5
Molina Healthcare (MOH)	0.00	44-46	41-42
Jazz Pharmaceuticals (JAZZ)	0.00	152-157	142-143
HDFC Bank Limited (HDB)	0.00	47-49	43-44
Gilead Sciences (GILD)	75.10	84-87	81-82
Bitauto Holdings (BITA)	0.00	46-48	42-43
Baidu (BIDU)	0.00	185-188	170-175
Bonanza Creek Energy (BCEI)	0.00	55-58	52-53
Arista Networks (ANET)	0.00	70-73	62-63

Current Market Outlook


The market definitely showed some improvement last week—the major indexes bounced back decently, and importantly, many recent earnings winners not only held their gains but stretched higher, something we haven’t seen much of for a few months. Because of that, we’re pushing the Market Monitor up a bit, but we remain relatively neutral for one simple reason: the market (and most stocks) are still range-bound, and until that changes, it’s going to be hard for any stock to make persistent progress. We’re OK doing some new buying, especially in some recent earnings winners (preferably on dips), but holding cash and keeping risk in check is necessary in this environment.

The good news is that we continue to see a broadening array of stocks firming up. Our Top Pick for the week is Tesoro (TSO)—while most energy stocks are still struggling, refiners are surging, and TSO looks like the leader. Buy on dips.

Stock Name	Price	Buy Range	Loss Limit
Vulcan Materials Company (VMC)	137.10	71.5-73.5	66-67
Tesoro (TSO)	0.00	82-85	75-76
Sprouts Farmers Market (SFM)	19.00	34-36	31-32.5
Lear Corp. (LEA)	0.00	105-108	96-98
Integrated Device Technology (IDTI)	0.00	19-20	17-17.5
GrubHub (GRUB)	140.03	38.5-40.5	35-35.5
E*Trade Financial (ETFC)	0.00	24-25	22-22.5
Tableau Software (DATA)	126.42	91-95	85-86
Ashland Inc. (ASH)	0.00	122-125	114-115
Amazon.com (AMZN)	2.00	362-372	335-338

Current Market Outlook


Some of the major indexes are probing the top of their multi-month trading ranges, which is nice to see. But the fact is that, until proven otherwise, the intermediate-term trend remains sideways, so the game plan remains the same—hold some cash and be selective with your new buying. For the stocks you own, you should continue to stick with what’s working—despite the incessant ups and downs, there are plenty of stocks that are working, so focus on the best and leave the rest.
This week’s list has another batch of strong stocks with good stories; we haven’t seen a rash of defensive stocks show up yet, which often occurs when the market is starting to get into trouble. Our Top Pick is Opko Health (OPK), which is speculative but has some major potential catalysts later this year.

Stock Name	Price	Buy Range	Loss Limit
Zebra Technologies (ZBRA)	154.94	106-109	94-95
Tesla, Inc. (TSLA)	818.87	237-244	213-216
SolarEdge Technologies Inc. (SEDG)	124.37	33-35.5	28-28.5
SolarCity (SCTY)	0.00	59.5-62	55-56
OPKO Health Inc (OPK)	0.00	16-17	14-14.5
Newmont Mining (NEM)	57.31	26.5-27.5	23-23.5
Horizon Therapeutics (HZNP)	49.89	27-30	25-26
Cirrus Logic Inc. (CRUS)	0.00	35-36.5	32-33
Cabot Oil & Gas (COG)	0.00	33.5-35	31.5-32
Activision Blizzard, Inc. (ATVI)	0.00	24-25.5	22.5-23

Current Market Outlook


Once again, the major indexes tested new high ground last week, and once again, the sellers appeared and drove the indexes and many stocks lower. Day-to-day fluctuations aside, the story remains the same—the intermediate-term trend remains sideways, though below the surface, there are many stocks and sectors making good-sized multi-week moves. So the goal, of course, is to stick with what’s working (though taking partial profits on the way up makes sense) while jettisoning any stocks that break support. Keeping some cash on the sideline is also wise, at least until the market begins a sustained uptrend.

This week’s list has it all—some speculative stocks, some stocks that have pushed ahead on big news and some turnaround situations. Our Top Pick is Ligand Pharmaceuticals (LGND), partly because of the big story, and partly because of the lower-risk set-up in its chart.

Stock Name	Price	Buy Range	Loss Limit
T-Mobile US (TMUS)	0.00	36-38	33.5-34.5
NetEase, Inc. (NTES)	0.00	138-143	127-128
MercadoLibre, Inc. (MELI)	980.83	140-145	130-133
Louisiana-Pacific (LPX)	0.00	17.5-18.5	16-16.5
Ligand Pharmaceuticals (LGND)	267.14	83.5-87	79-80
Integrated Device Technology (IDTI)	0.00	23-24	21-22
Dunkin’ Brands Group, Inc. (DNKN)	0.00	52-53	49-50
Clovis Oncology (CLVS)	0.00	84.5-87.5	77-78
Ciena (CIEN)	44.25	23-24	20.5-21
Broadcom Limited (AVGO)	266.26	143-148	128-130

Current Market Outlook


The market’s intermediate-term trend turned back up last week after the major indexes tacked on more gains following the Fed’s dovish words. Combined with a bullish longer-term trend and many indicators that suggest investors remain hesitant, the path of least resistance for stocks remains up. That said, the market rarely makes it easy, and on that note, we’ve seen a fair amount of rotation in recent days out of some of the strong (and in many cases, extended) growth stocks and into other areas of the market. Overall, we remain bullish, but you should take things on a stock-by-stock basis—if you own something at a good profit, consider booking partial profits and trailing a stop for the rest, while honoring loss limits on any recent purchases. On the flip side, many “fresher” names look poised for higher prices as they’ve only recently emerged from multi-month slumbers.
This week’s list contains all types, but includes a few of those fresher-looking charts. Our Top Pick this week is Iqvia (IQV), a steady, reliable medical play that just blasted off from a good-looking rest period.

Stock Name	Price	Buy Range	Loss Limit
Agnico Eagle Mines (AEM)	79.05	49-51	44-44.5
AAXN (AAXN)	87.11	70.5-73.5	63.5-65.5
CoStar Group (CSGP)	589.55	540-555	495-505
Exact Sciences (EXAS)	116.91	109-113	98-101
Insulet (PODD)	175.69	113.5-116.5	101.5-103.5
IQVIA Holdings (IQV)	157.93	153-157	141-143.5
Rapid7 (RPD)	63.52	54-56.5	50-51.5
Sea Limited (SE)	132.86	31.5-33	27-28
Tempur Sealy (TPX)	85.53	70-73	63-65
Under Armour, Inc. (UAA)	26.82	24.5-25.5	22.5-23

Current Market Outlook


The good news is that the general market has been whacked two or three times during the past couple of weeks, but each time has staged a strong rally, including today’s spirited advance. That said, despite the nice Friday/Monday rebound, the intermediate-term trend is still iffy (most indexes are sitting at or below their 50-day lines and below their highs from last week), so our overall stance hasn’t changed much—you should remain cautious, limiting new buying and holding some cash, though we’re also fine sticking with your strong, profitable names, giving them a chance to resume their uptrends down the road. The game plan from here is simple: If the market fades again, we’ll remain cautious, but should the recent strength continue, we’ll gradually turn more constructive and put money to work.
This week’s list (and the past couple of weeks) are great for getting your ducks in a row should the bulls decisively retake control. Our Top Pick is Appian (APPN), which looks like a new small/mid-cap leader following a massive breakout. Try to buy on dips.

Stock Name	Price	Buy Range	Loss Limit
ACADIA Pharmaceuticals (ACAD)	47.84	28.5-30	25.5-26.5
AngloGold Ashanti (AU)	20.45	19.5-20.5	17-17.5
Appian (APPN)	46.48	55.5-58.5	48-49.5
Dexcom (DXCM)	421.36	160-164	148-150
eHealth (EHTH)	122.74	103-107	91-93
Five9 (FIVN)	78.35	60.5-63	54.5-56
JD.com (JD)	39.58	30-31.5	27-28
KLA Corp. (KLAC)	158.80	135-138	124-126
Q2 Holdings (QTWO)	80.81	87-90	78-80
Universal Display (OLED)	187.54	208-216	182-186

The market remains mostly in the same position it has been, with the big-cap indexes trending nicely higher and, based on historical studies, the outlook for the indexes very bullish looking out 3 to 12 months. That said, the broad market is borderline iffy (our Two-Second Indicator is negative) and the chop factor is still with us for growth stocks, so we’re still not cannon-balling into the pool ... though we do see many setups (as so many stocks have marked time for the past 1 to 3 months) out there. Tonight we’re adding another new half-sized position but are still holding about one-third in cash as the next couple of weeks will be telling.