Search

MP Materials (MP), a rare earths mine and processor, is down about 11% this morning.

WHAT TO DO NOW: The market remains in a pullback, with interest rate fears causing the indexes to slowly deflate. To this point, most indicators are still positive, though they’re leaning on the fence—yet there are many stocks and sectors that look ready to get going if the bulls can show up. All in all, we think how the Model Portfolio is situated (38% cash) makes sense here, though given the slippage, we will place ProShares S&P Fund (SSO) and Wingstop (WING) on Hold tonight. Details below.

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.

It’s been an encouraging start to the year for stocks, but another Fed rate hike – and whatever choice words Jerome Powell has to say – could throw the brakes on the rally this week, at least temporarily. To prepare for another potential pullback, today we’re adding some protection in the form of a high-yield dividend payer from the healthcare industry. It’s a stock with some real momentum – up 18% in the last five weeks – but still trades at about half of where it was a year ago. And Tom Hutchinson just upgraded it to Buy in Cabot Dividend Investor.

The year has certainly started out in fine fashion. The S&P 500 has delivered positive returns for all four weeks so far this year. The S&P is up 6% YTD and the Nasdaq is up 11% YTD, as of Friday’s close.

But earnings have been lousy so far this quarter, with the average S&P 500 company that has reported so far posting -5% earnings growth from last year’s quarter. But the market was expecting that. Investors know there will be a declining economy this year, and the sooner it declines, the sooner the Fed will be done hiking rates.

This week could be a doozy for the market as traders are eagerly awaiting the “big” Federal Reserve announcement on Wednesday, as well as a monster week of earnings reports, and the January Jobs Report on Friday. Buckle up!

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.

The market is doing everything it can so far this year to be unlike 2022. It’s up. And the best performing sectors are cyclical.

So far this year, the S&P 500 is up about 5% and the technology stock-heavy Nasdaq is up almost 10% in just a month. Not only are the indexes higher but they are being driven by last year’s worst performing sectors, technology and consumer discretionary.

A rebound in Chinese economic activity after the end of draconian covid lockdowns could be a bullish sign for the red metal, “Dr. Copper.”

Reliability is paramount in today’s bear market. And few stocks are more reliable than these three Dividend Aristocrats, writes Sure Dividend.

WHAT TO DO NOW: The market continues to improve its standing, with our Cabot Tides now positive and, barring a meltdown tomorrow, a green light is likely from our Cabot Trend Lines, too. Individual stocks remain trickier, especially on the growth side of things, so we’re not cannonballing into the pool. But with things looking better we’re continuing with our path of putting money to work. Tonight, we’re adding a new half-sized position in Las Vegas Sands (LVS), filling out our stake in Academy Sports (ASO), and putting another 3% position into ProShares S&P 500 Fund (SSO). That should leave us with around 50% cash; we hope to deploy more of that in the days ahead.

Perhaps a slogan that best represents American history as well as the American stock market might be - “America Runs on Optimism.”

Today we are moving shares of Dow (DOW) from Buy to Sell. As the shares have reached our 60 price target, and with no compelling reason to raise that target, we are moving the shares from Buy to Sell. This change will also be made in the Cabot Turnaround Letter.

Following a monster week of earnings, a Federal Reserve interest rate hike, and the January Jobs report, “risk on” continues to be the theme in early 2023 as the Nasdaq once again led the indexes higher.

Following a monster week of earnings, a Federal Reserve interest rate hike, and the January Jobs report, “risk on” continues to be the theme in early 2023 as the Nasdaq once again led the indexes higher.

When Warren Buffett talks, it’s time to listen. So with Berkshire investing in solar companies, it’s time to look at these clean energy ETFs.

While this morning is a bit of a downer, the week as a whole has been a great one for stocks, with the major indexes up in the 2.5% to 5% range generally speaking. But more important to us is where that strength has taken the indexes—specifically, above their December highs, which turns the market’s intermediate-term trend up.

The market is making some noise so far this year. And in a good way. The S&P 500 is 7.7% higher and the Nasdaq is up 14.7% YTD. Is this real, or just another head fake?


The rally is being prompted by increasing optimism of a soft landing, where inflation falls without the economy falling into recession. Previously pessimistic pundits are now embracing the possibility. And there is some evidence to back up the soft-landing scenario.

Despite concerns coming into 2023, the U.S. economy is showing a degree of strength that continues to bode well for investors.