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This is an incredible market that just keeps creeping higher. The promise of a booming recovery with trillions in stimulus ahead continues to pull stocks to new all-time highs.

The market continues to forge nowhere. The S&P 500 is still below the May 7th high, but it’s only less than 1% below the high. It stopped going up. But it isn’t going down.

It’s earnings season. So far, it has mainly been just the big banks that have reported. And the results have been largely positive.

So much for the technology selloff. The sector dipped its toe into correction territory and has roared back with a vengeance.

The market is still in an uptrend and not far from the highs. But things are changing.

Enjoy the current strength but be aware of the environment we’re in, and why. Accept that we could see a significant retreat in the prices of many of our stocks in the near term, but that the fundamental reasons behind their current strength should persist despite a retreat, and drive them higher over the coming years.

This has been a relatively quiet week for us in terms of quarterly reports as Repligen (RGEN), which reported this morning (details to follow), was the only portfolio company on the schedule.

With the war in Ukraine taking center stage, it’s very hard to predict what markets will do. But we don’t need to. All we need to do is keep following proven investing systems.
The only change to the portfolio today is the downgrade of Veeco (VECO) to Hold.


As for the new recommendation, it’s probably a household name for folks in the Chicago area, but it’s a new one for me. And it’s a new stock, as well, having just come public in October.


Details inside.

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.

Stocks continue to move higher despite more tariff news. A 25% tariff was announced over the weekend on all imported steel. But the market is so far taking the news in stride during a good earnings season.

We’ll see what happens with the tariffs. But whatever happens with this latest round, it is most likely that tariff issues will remain at least a background story for most of this year. Meanwhile, stocks are being buoyed by strong earnings.

The market has been sideways for the past couple of months. It’s up YTD because of a rebound from the December swoon. But the S&P is still at about the same level it was in early December.

Earnings have been solid, averaging about 11% growth in the quarter as tech earnings moderate and the rest of the market catches up. Earnings are expected to average about 14% in 2025. But the solid earnings quarter is only helping the market hold serve in the face of higher interest rate expectations, tariffs, and a strong dollar.

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.

A week ago, the market was teetering on the brink. But it teetered in the right direction.

The benchmark ten-year Treasury rate had soared above 4.8%, dangerously close to the late 2023 peak of about 5%. December CPI inflation was reported last week. A bad number could have thrust the 10-year rate above the peak, almost certainly prompting a selloff in stocks. But Wall Street was happy with the number and things went the other way.

It’s one thing after another. But stocks keep inching higher.

January featured the interest rate scare, as the ten-year Treasury hit the highest level since 2023, and the DeepSeek news, which called AI spending into question and sent related stocks reeling. Yet the S&P 500 finished the month up 2.7% with 10 of the 11 sectors higher for January. This week features more potential market-moving issues.

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.

After another up week and a record close last Friday, the market is grappling with mixed signals.

Last week’s highly anticipated jobs report came in much better than expected. The previous two weak jobs reports had roiled the market as they stoked recession fears. But not this one. The market was initially thrilled but is now thinking twice about the situation.

The market is wrapping up another good month and quarter. The S&P posted strong gains in September, after three straight winning weeks in a row, following a rough first week. The index is also up nicely for the third quarter and near the all-time high with a better than 20% gain year-to-date.

The latest upward leg is being driven by cooling inflation, falling interest rates, and a still-resilient economy. We’re getting the rate cuts without the economic pain and an expected soft landing. What’s not to like?

The market has been just great! The S&P 500 was up 5.7% in November and now has a 26.47% year-to-date return. This adds to the 26% market return last year.

Stocks were riding high, and the election provided a further boost as investors expect a higher level of economic growth going forward. The cyclical stocks have led the recent charge. The best-performing market sectors since the election are finance, consumer discretionary, and energy.

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.

Welcome to the post-Labor Day market. A sobered-up investor can be an ornery investor.

Stocks kicked off the first trading day after Labor Day on a decidedly negative note. The August manufacturing number was still somewhat weak, but all eyes are on the August jobs number that comes out Friday. It was the weak July jobs number that prompted recession fears and the market selloff in early August. Another bad number could reignite recession worries that had faded in the second part of August.