Search

We’ve been writing about some of the market’s short-term uncertainties (election mainly) and secondary headwinds, including rising Treasury rates and relatively elevated sentiment (there really hasn’t been much selling since early September)—and this week finally brought an air pocket, mainly via yesterday’s across-the-board selling.

The big news of the week was the Fed’s decision to cut interest rates by a full half point, and that was certainly part of the reason stocks had another solid week—coming into today, the big-cap indexes were up 1.5% to 2%, while broader indexes put in an even stronger performance.

It’s been a quieter but mostly positive week, with most major indexes up in the 0.5% to 1.5% range, though much of the broad market was relatively flat.

Last week, we saw the market begin to hesitate and leading stocks begin to take on some water on some earnings reports—combined with good-not-great action from the major indexes in the weeks before, that put the overall intermediate-term trend on the fence.

It’s been a poor week for the market, with the big-cap indexes down in the 2% range coming into today, and broader indexes like small and mid-caps are off more, with growth stocks also lagging.

We’ve been easing off the accelerator somewhat during the past two or three weeks as fewer stocks had been participating in the upside, and historically, even the strongest market rallies off of major or panic lows have run into some turbulence three to four months after the kickoff point (in this case, April 21). And this week we saw some selling finally appear—on Tuesday and Thursday, solid gaps higher were sold into, and today, the market and most every sector is taking on water.

It’s been an eventful past week, with the market tanking last Friday on a flare-up in U.S.-China trade tensions, followed by a volatile-but-solid bounce for a couple days, only to see renewed distribution pop up again yesterday as bad debt fears take hold among financial stocks. All told, the indexes are up nicely on the week (though still flat to down if you include last Friday’s hiccup).

Happy New Year! Just as a reminder, we had a special Movers & Shakers on Monday as there was no regular Top Ten issue—and we have a brief update today, with our latest thoughts on the market as the calendar’s flipped and updated stops. We (and most big investors) will be back at it in full come Monday.

==

The market closed the year on a weak note, with the major indexes all slipping the final few days of 2025, led by growth-y areas, which continue to lag. Today’s pop is a good start to the year, though, which keeps the overall evidence in much the same spot as it has been.

The underlying trends that have been in place for the past few weeks pushed further in this first full week of the new year, where we saw many broader indexes advance nicely, with most kissing new high ground. On the flip side, the big-cap indexes were up but lagged, with the Nasdaq bringing up the rear, with many hot stocks from last year getting hit (presumably on some tax-related selling).

It’s been a fairly quiet few days for the major indexes, with most down less than 1% on the week after the recent sharp recovery, which seems normal enough.


More important to us is that our intermediate-term trend model (called Cabot Tides) has turned positive today—essentially, after a decline like we saw, a green light happens when most major indexes are above where they were five weeks ago (the 25-day moving average starts to trend up). That’s happening today, as five weeks ago was the early-April crash, and of course the indexes have had a good rally of late.

Housekeeping: As a reminder, with the market closed on Monday, your next issue of Top Ten will come Tuesday evening, February 18. Have a great long weekend.

==

It’s been a solid week for the big-cap indexes and many growth measures, most of which are up a couple of percent or a bit more, though the broad market indexes have been mostly quiet, up or down a smidge.

WHAT TO DO NOW: While we’re not aiming to sell wholesale given our large cash position (60% coming into this week), today we’re going to sell the remaining portion of our stake in AppLovin (APP), which is being mauled by a couple of short reports today. We had already sold the vast majority of our stake, but today we’ll sell the rest and hold the cash. Details on that (and other stocks) below.

Happy Halloween! October has lived up to its billing as a volatile, tricky month, and this week might be the most unusual of all. On one hand, we have the big-cap indexes notching another decent gain, some hot stocks remaining hot and, encouragingly, we’ve seen a few fresh breakouts among growth names, too.

Last week we talked about the split tape and said that, while sticking with our stance due to some positives (including some fresh breakouts from growth stocks), our antennae were up should we see a change in character. And this week was a step in that direction, as all the indexes are sporting losses, this time led by the big-cap indexes—as of this morning, the S&P and Nasdaq are off 2% or so, with smaller losses posted by other indexes.

The market has been trying to climb off its knees this week as we’re finally getting some solid evidence that both inflation and the job market are cooling.

In a seemingly odd twist, in the short term what’s bad for the economy is probably good for the stock market. While that doesn’t mean we’re out of the woods just yet, I’m going to up our risk profile slightly with a potential big winner in the battery industry.

This company is currently qualifying batteries for wearable technologies and expects to move into more consumer markets, as well as the EV market, in the coming years. All the details are inside the October Issue.

Enjoy!

Ahead of the long holiday weekend, it was a mixed bag last week as the S&P 500 rose 0.58%, the Dow lost 0.25%, and the Nasdaq climbed 1.55%.



This week traders will keep a close eye on inflation as the Labor Department releases its August index of U.S. wholesale prices, otherwise known as the producer price index. The market is estimating an increase of 0.5%, after 1% increases in June and July. July witnessed a 7.8% increase year over year, which was the largest bump in over a decade. Another spike would not bode well for the overall market, so I will be keeping an eye on the release and its impact on price action.



With that in mind, and always an eye on diversification, this week’s pick is a steel and iron enterprise company.

Last week, despite a large market decline on Monday, the major indices took a baby step forward. The S&P 500 gained 0.51%, the Dow rose 0.62%, and the Nasdaq eked out 0.02%.



The advance came despite ongoing uncertainties around Chinese property developer Evergrande and the seemingly hawkish message from the Fed announcement. Now the focus has shifted to Washington, D.C.’s finest and the decision around the debt ceiling and infrastructure. Add a sprinkle of Chinese power concerns and there seems to be just enough worry to keep investors on their toes.

For the past six to nine months the consensus among traders had been that the Federal Reserve would be cutting interest rates this year, and some thought it would be aggressive cutting. However, that narrative may have changed on Thursday as two Fed members noted that the central bank might not cut at all in 2024. This sent shockwaves through the stock market Thursday and Friday.


By week’s end the S&P 500 had fallen1%, the Dow had lost 2.25% and the Nasdaq had declined by 1%.

It was a strong week for the market following the Federal Reserve meeting. And while some talking heads may say the reason the indexes rallied was the Fed’s moves, or lack thereof, more likely the reason is we are in a bull market.