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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.

Aside from AI, a few other big-picture themes came into sharper focus for me this week.

All are positive for small caps.

First, economists and analysts are reducing their recession risk outlooks as the economy continues to hold up reasonably well. That’s good for small caps as they are more economically sensitive than mid and large caps.

Small-cap value stocks have been an underperforming asset class for years, but a few individual names are worthy of closer looks.

The good year is continuing. The market rally is broadening. And pundits increasingly have positive things to say about the second half of the year.


Artificial intelligence isn’t the only mania capturing the imagination of investors. The soft-landing belief is also widespread. Investors see inflation falling fast, the Fed nearly done hiking rates, and no recession. It looks like we can get through this rate hiking cycle, the steepest in decades, without much economic pain.

Artificial intelligence is an undeniable mega-trend, but the story is evolving from “tell me” to “show me” as companies report earnings.

Cannabis-friendly states are showing strong sales growth while legalization progresses and states tamp down on the illicit markets.

Sector and index rotation was the name of the game last week as money raced out of tech to end the week and into sectors that had not been participating in the market’s advance recently. That being said, this is not necessarily a bad sign as the S&P 500 gained 0.7%, the Dow rallied 2.08% and the Nasdaq lost 0.6%.

Sector and index rotation was the name of the game last week as money raced out of tech to end the week and into sectors that had not been participating in the market’s advance recently. That being said, this is not necessarily a bad sign as the S&P 500 gained 0.7%, the Dow rallied 2.08% and the Nasdaq lost 0.6%.

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.

WHAT TO DO NOW: Remain bullish, but be prepared for some near-term (and possibly earnings-induced) gyrations. Today’s sharp drop in the Nasdaq and many leaders is a short-term shot across the bow—combined with some other factors, the odds are growing that we may finally see some selling that lasts for more than a couple of days. That said, the overall environment remains bullish, with higher prices likely down the road. All in all, we’re bullish but are taking things on a stock-by-stock basis and expect some further wobbles in the days ahead. Our only change tonight is that we’re placing Celsius (CELH) on Hold. Our cash position remains around 16%.

We comment on earnings from Capital One (COF), First Horizon (FHN) and Nokia (NOK). Next week, the deluge starts, with ten companies reporting.

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.

The fall in crude prices has investors looking past the oil patch, but tightening supplies could make these 3 companies potential winners.

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.

Today, a whopping eight Profit Booster positions will expire. Most are “slam-dunk,” full-profit trades, while others will go down to the wire.

The big takeaway, before we dive in, is we are going to let the situation play itself out, and come Monday/Tuesday of next week we will revisit our profits, as well as how we will manage the remaining positions.

This week has brought a wave of rotation—after strong initial gains, the Nasdaq has reversed to minor losses on the week (coming into Friday), with the S&P 500 up less than 1%. Meanwhile, broader indexes are up in the 1.5% range on the week and, for individual stocks, we saw some of the hot mega-cap growth names get smacked around some, while the rest of the market held firm or pushed higher.

We’re now in month nine of a bull market, but not all stocks are benefitting equally. It’s a classic stock picker’s market.

The good times are here again. The S&P 500 is up over 19% YTD and is now within just 4% of the all-time high. Stocks are in a strong uptrend that began in the beginning of May and appear likely to move still higher.

Inflation is crashing. The Fed is about out of bullets. And there is no recession in sight. Things could always discombobulate down the road. But there doesn’t appear at this point to be anything ahead in the next month or so that will change the current positive narrative.

As earnings season approaches the midway point, and following the Federal Reserve’s announcement of a 25-basis point interest rate hike last week, the market continued its ascent. For the week the S&P 500 gained 1%, the Dow rose by 0.65% and the Nasdaq added 2%.

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.