Search

The three leading indexes again made a run at new highs last week as the S&P 500 gained 1.75%, the Dow rallied 0.7% and the Nasdaq added 2.88%.

As central banks around the globe aggressively raised interest rates, the stock market had its second straight awful week of trading. The S&P 500 fell 4.6%, the Dow lost 4%, and the Nasdaq continued its ugly slide, falling another 5.1%.

You may not expect small-cap stocks to outperform in the bear market, but these three companies are shrugging off inflation and thriving.

As central banks around the globe aggressively raised interest rates, the stock market had its second straight awful week of trading. The S&P 500 fell 4.6%, the Dow lost 4%, and the Nasdaq continued its ugly slide, falling another 5.1%.

The Cabot Emerging Markets Timer is solidly negative, and the U.S. indexes have joined in the decline.

The yellow flag is still out from the Cabot Emerging Markets Timer, but there has been a little bump of interest from buyers. There are no changes in today’s update.

U.S. markets were mixed today after a remarkable three-day rally in the S&P 500 that began on Monday. The market is still working out the potential winners and losers implied by a Trump presidency, but having the S&P and the Dow above their 25- and 50-day moving averages is a good first step, although there’s no question the action is incredibly bifurcated.

Last week wasn’t great for growth stocks and so far, this week is just plain awful. The primary culprits are known; risk of inflation and higher interest rates have pushed cyclical stocks up and growth stocks down (generally speaking).

Remain optimistic, but keep some powder dry, too. We’re pleased to see our Two-Second Indicator improve, but our Cabot Tides are still on the fence and few stocks are moving out to new highs. We believe the market’s next major move will be up, but near-term, we’re going to wait for confirmation that the buyers are back after a five-week pause.

I still get questions about Apple. Here’s what I think about the stock and its similarity to Facebook and two recent IPOs that could be the next Apple.

Two of our stocks report second-quarter earnings beats, one stock moves from Buy to Hold, and a good buying opportunity.

The meat of earnings season is upon us—many blue-chip firms have already reported, but the fast-growing, emerging leaders are just starting to release numbers. Remember that big earnings gaps up (10% or more) generally lead to further gains in the weeks ahead (with normal pullbacks, of course), and vice versa. So it shouldn’t be a surprise to see a few recent earnings winners in this week’s Top Ten; a couple of them are likely to be big winners should the market continue to trend higher. Overall, we remain optimistic the market’s best days are ahead, but there’s no rush—things are still falling into place, supporting further gains in the weeks to come. Our favorite of this week is Fording Canadian Coal (FDG), a stock that’s been featured a few times in Top Ten, thanks to its huge reserves of metallurgical coal. The entire group remains strong, although it has paused somewhat in recent weeks. We think it’s a good time to get on board.

Stock Name	Price	Buy Range	Loss Limit
FRO (FRO)	0.00	51-53	-
GDI (GDI)	0.00	45-48	-
PDE (PDE)	0.00	38-41	-
SOHU (SOHU)	0.00	65-70	-
SOL (SOL)	0.00	16-18	-
SWN (SWN)	0.00	38-42	-
XEC (XEC)	0.00	59-62	-
CLF (CLF)	0.00	150-160	-
DAR (DAR)	0.00	13-15	-
FDG (FDG)	0.00	60-63	-

Last week was a decisive week, in our view. Not only did the major indexes score solid gains, but many individual leading stocks put on a good show, telling us the bulls are finally joining the party. Of course, with the meat of earnings season still coming up, there are bound to be ups and downs in the weeks ahead. But we’re growing more confident that the bear phase from October of last year through March of this year—punctuated by the collapse of Bear Stearns—is coming to an end. This week’s Top Ten is once again heavy in the commodity areas, which are leading the market higher. We do believe traditional growth stocks will appear if this market is going to run, but for now, the buying is clearly in metals, steels, oil and gas. Our favorite of the week may be a surprise. It’s U.S. Steel (X), a big, old firm, but one that might be best positioned to take advantage of higher steel prices in the months ahead. Try to buy on weakness.

Stock Name	Price	Buy Range	Loss Limit
AGU (AGU)	0.00	75-85	-
BUCY (BUCY)	0.00	117-120	-
EAC (EAC)	0.00	43-46	-
HP (HP)	0.00	51-54	-
MEE (MEE)	0.00	49-53	-
MMR (MMR)	0.00	22-24	-
PXD (PXD)	0.00	53-58	-
SOHU (SOHU)	0.00	50-55	-
WFT (WFT)	0.00	76-82	-
X (X)	0.00	145-155	-

Household debt is rising, and consumers are feeling the squeeze of higher interest rates everywhere, from mortgages to auto loans to credit cards. In this month’s issue we’ll share ten warning signs that signal financial trouble ahead and the ten bad financial habits you need to drop now to avoid it.

The New Year promises to be a great one for dividend stocks. After underperforming the market in 2020, the stars are aligning to make 2021 the year of the dividend.

The distribution of the coronavirus vaccine promises to bring this pandemic to an end and unleash a full and robust recovery in 2021. Energy stocks that had been neglected in the market recovery have caught fire in anticipation of a full recovery in 2021.



A huge and overdue rally in the sector has paused temporarily ahead of a very promising year, giving us an opportunity to get into one of the very best stocks in the sector at a still cheap price.



Global energy giant Chevron (CVX) currently offers the rare combination of great value and momentum, as well as a fat yield. The stock has already moved higher, the rally has a long way to go.

Bank stocks have gone nowhere this year. But there are signs that the ice-cold sector is beginning to thaw. Here’s what I see.

What a rally off the bottom! After flirting with a severe correction and possibly a bear market, stocks have soared over the past two weeks. The S&P 500 is now down less than 3% YTD. What happened?

Panic waned and investors realized that the economy is still strong, interest rates are still low, and money has no place else to go but stocks to fetch a decent return. The initial panic from the Russia/Ukraine war subsided. Then the Fed hiked rates by a measly 0.25% and pleased short-sighted investors.