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This market has confounded a lot of people over the past few years. Individual market sectors have been as perplexing as the indexes. Last year, the worst performing market sector by far was technology. This year it is by far the best performing sector. Last year, energy was the best performing sector. In the first half of this year, it was the worst performing.

Other sectors like consumer discretionary stocks that had been among the worst sectors last year are among the best this year. Defensive sectors including health care and utilities that delivered stellar returns last year have been dogs this year. In fact, the utility sector has displaced energy as this year’s worst performing S&P 500 sector.

The last few years have also illustrated a tendency for downtrodden stock sectors to rise from the canvas and become among the market’s best performers. Many utility stocks are currently near multi-year lows. But not because of the operational performance of the companies, which has largely remained solid. It’s mostly because of high interest rates, which may be peaking, and the mood of investors so far this year, which always changes.

Utilities are dirt cheap in an expensive market. They are also stellar relative performers in a slowing economy. But they are likely to rise from the current dark depths even if the economy remains buoyant. In this issue, I highlight one of the best performing utility stocks over the past 10 years that is currently selling near a multi-year low in a changing market.

Buying great stocks cheap is never a bad strategy over time.

I also highlight a fantastic covered call opportunity in a stock that has been on fire over the past couple of months. It’s a great chance to keep the income rolling in.

When volatility is low, selling options becomes less profitable but buying them becomes more affordable. Here’s my favorite options strategy for that environment.

Ahead of the long holiday weekend the market had yet another good week. The S&P 500 gained 1.75%, the Dow rallied 1.5%, and the Nasdaq rose another 1.9%.

This week in an attempt to diversify the portfolio we are adding an energy play.

Including “AI” in your earnings calls was a cheat code for companies in the first half of the year, but investors ultimately need to see those efforts monetized, and it’s already starting.

Academy Sports (ASO) Dips on Dick’s Sporting Goods’ (DKS) Horrible Quarter

A combination of supply cuts and rising demand is finally lifting oil prices after a year of decline, these three stocks can help you capitalize on the rebound in crude.

Although it’s lost some steam in August, we remain in a “rolling” bull market, and traders should invest accordingly.

It was another rough week for the bulls as the bond market and China worries continue to weigh on the indexes. By week’s end the S&P 500 and Dow had both lost 2.22%, while the Nasdaq declined by 2.6%.

Earnings season is about over. And the end of the summer is upon us.

This is a weird time of year for the market. Investors tend to pay less attention because many of them are focused on trying to squeeze in the last bit of summer fun and laxness before it slips away. The market tends to do whatever it was doing before people stopped paying attention.

It was going sideways, and that is what it will likely continue to do for the next several weeks. Of course, a major headline could certainly change that. But most often these waning days of summer tend to be less eventful.

In the August Issue of Cabot Early Opportunities, we talk about what happened to the summer stock rally and dig into five companies selling everything from coffee to sporting goods to mobile advertising tools.

Enjoy!

There are four key traits that have helped Cabot Turnaround Letter generate years of market-beating returns; here’s how we do it.

Welcome to this week’s Cabot Macro Investor update.

I’m joking. We’re still all about small-cap stocks. But now that earnings season is over it’s all about the macro again. So we’ve got to address it.

In the second half of July, I felt like we were due for a pullback.

The rally is floundering in August.


A pullback of sorts isn’t unusual or unexpected, especially in the waning days of summer. Many investors are focused on squeezing in more summer before it slips away and they aren’t paying attention to the market.

Beginning on a positive note, I’d like to remind you of the power of compounding returns when you stay in the stock market over time. For example, $100 invested in three-month Treasury bills in 1928 grew to only $2,141 by the end of last year while it became $46,379 invested in medium-grade corporate bonds and a stunning $624,534 if invested in a broad basket of stocks, according to data from New York University finance professor Aswath Damodaran.

China’s continued economic woes took center stage globally this week, as the country’s central bank unexpectedly cut key interest rates in a bid to spur economic growth, manage high debt in the property sector, and lower its 20% youth unemployment rate. An index of Chinese stocks traded in Hong Kong has fallen more than 9% this month.

Ahead of the long holiday weekend the market had yet another good week. The S&P 500 gained 1.75%, the Dow rallied 1.5%, and the Nasdaq rose another 1.9%.

This week in an attempt to diversify the portfolio we are adding an energy play.

In this week’s video, Mike Cintolo talks about the market’s under-the-surface improvement that he’s seeing; no indicators have changed, which will need to happen for him to extend his line in a big way, but there’s no question most stuff has seen improvement and more stocks are beginning to act properly. Mike did a little buying this week and is hoping to add more should the market be able to build on the recent action.

Braze (BRZE) delivered Q2 results after the close yesterday that beat expectations. Revenue grew 33.6% to $115.1 million, beating by $6.4 million while EPS of -$0.04 was up from -$0.16 in Q2 last year and beat by $0.10.

This week Chris and Brad talk about the latest Chinese GDP numbers and whether it’s safe to invest in China, Tesla’s earnings release, and what they’re seeing with Regional banks now that they’re reporting. After that, they break down FAANG stocks, their popular ascent as market shorthand, and whether Microsoft is “sexy” enough to sit at the cool kids’ table.