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While U.S. indexes have been choppy-to-down during the past few weeks, emerging market stocks remain in good shape and our Emerging Markets Timer is positive. Our new recommendation tonight looks like one of the best ways to play the general boom in electric vehicle production in the years ahead.

Although markets have stumbled a bit out of the gate, investors looking to see the S&P 500 build on the 11% advance in the final quarter of 2023 may not have long to wait. U.S. companies are due to start reporting results next week, with the big banks leading the way.

An election year like 2024 with a sitting president running is historically a bullish scenario for U.S. stocks. Since 1949, the S&P 500 is averaging a gain of nearly 13% in those election years, per the Stock Trader’s Almanac.

So let’s kick off the year by adding another aggressive growth stock.

The Federal Reserve held interest rates steady and signaled it is open to cutting later this year, especially if economic growth and employment slow in an election year. Big tech earnings so far are a mixed bag and below elevated expectations.

But cybersecurity companies have been resilient due to ever-growing demand. And today, we add a familiar cybersecurity name to the Explorer portfolio.

In her latest State of the Union address, European Commission President Ursula von der Leyen provided the parliament and citizens of Europe with a stark reminder of a problem that continues to plague governments, corporations and individuals around the world.

In her speech, she specifically referenced “the higher cost of living” for millions of Europeans as “THE global crisis” (emphasis mine). Not climate or geopolitical instability or cybersecurity threats, but inflation.

FedEx (FDX) reports earnings later today and all will be watching as its shares tumbled last week after it issued a sales warning. The Federal Reserve issued its fifth interest rate hike of 2022, and it certainly won’t be the last one, warned dove-turned-hawk Fed Chairman Jerome Powell. This brisk run-up in rates, which should have been earlier and faster, is hitting growth stocks hard since those are mostly high revenue growth companies that are not yet profitable. The market is punishing this group to levels that tempt longer-term investors.

Current Market Outlook


After a very strong rally from the late-January lows, the major indexes are again in the midst of a pullback—during the past week and a half we’ve seen a few days of churning and distribution as worries over inflation (and a less-loose Federal Reserve) cause some profit taking, and today saw a big rotation out of growth stocks. Could this be the start of a “real” correction? It could be, as the intermediate-term advance is long in the tooth and sentiment remains giddy. That said, we never anticipate, and so far, we really haven’t seen much abnormal action yet—while a few stocks have fallen apart after earnings, most leaders are intact and even the weakest major index (Nasdaq) is near its 25-day line, which is acceptable. Given some of the yellow flags out there, our antennae are up, but with most of the evidence still positive, we’re keeping our Market Monitor at a level 7.

This week’s list has many recent earnings winners, including a few that are busting loose from good-sized bases (regular or post-IPO). Our Top Pick is Wix.com (WIX), which has a great story, accelerating growth and just staged a very powerful breakout.

Stock Name	Price	Buy Range	Loss Limit
The AZEK Company (AZEK)	47	45-47.5	40.5-41.5
Deere & Company (DE)	338	318-328	288-294
DraftKings Inc. (DKNG)	60	59.5-62.5	52-53.5
Magna International Inc. (MGA)	87	81-85	73-75
Mohawk Industries (MHK)	174	162-168	146-149
MongoDB (MDB)	392	395-407	355-365
SelectQuote (SLQT)	30	27-29	24-25
Sonos (SONO)	38	34.5-36.5	29.5-30.5
Teck Resources Limited (TECK)	23	21-22	18.7-19.5
Wix.com (WIX)	335	333-346	295-305

Three portfolio stocks recently reported earnings and one moves to Strong Buy.

“The European currency is hovering around its four- year low. The euro first started losing relative value at the onset of the financial crisis. In times of trouble or uncertainty, investors flock to traditional so-called safe havens such as the U.S. dollar and gold. When the debt problems among some...

The Prudent Speculator is one of the top ten best-performing newsletters tracked by the Hulbert Financial Digest over the last 15 and 25 years. “Though our primary focus is always on buying broadly diversified portfolios of undervalued stocks that we think will provide substantial capital appreciation over the long term,...

It’s been a solid rebound week for the markets, but as has been the case lately, it really depends on where you look—many major indexes actually hit new highs yesterday, but the Nasdaq could “only” get back to its 50-day line, and so far this morning, we’re seeing some sellers reemerge.

Last week’s improved vibes have quickly fallen by the wayside as the market got hit first by another round of hawkish Fed talk and then, more importantly, of fears that something is coming loose in the system—the failure of Silvergate (SI) was half expected, but the implosion and run on SVB Financial (SIVB) is sending shockwaves through the banking system.

Between record state-level cannabis sales, improving price compression and positive polling, there are signs of hope that cannabis stocks may finally get out of the doldrums.

We are recommending shares of CNH Industrial (CNHI) as a new Buy. The company is a major producer of agriculture (80% of sales) and construction (20% of sales) equipment for customers around the world and is the #2 ag equipment producer in North America (behind Deere). It also provides related supplies, services and financing.

Bitcoin was created in 2009, but cryptocurrency investing didn’t reach the mainstream until a decade later. Here’s what to look for in 2022.

Ahead of a monster week of economic data and earnings releases the S&P 500 fell 0.85%, the Dow lost 2.6%, and the Nasdaq gained 0.4%

We had been writing about some of the secondary yellow flags that had been popping up of late, mainly due to the incredible rise in many growth stocks in both price (well above moving averages) and time (the biggest winners got going back in September), as well as near-term sentiment (getting giddy, not just with growth stocks but everything post-election).

It’s been a mixed week for the market, with the big-cap indexes doing well and many leading growth titles again showing strength, but the broad market and many sectors were sluggish (not awful, just down some) and we have started to see a few leaders here and there that have begun to wobble.