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The top-down evidence remains mostly positive out there, but growth stocks have been hit very hard--taking things on a stock-by-stock basis has us with more than 50% in cash and, given the breakdowns out there, we’re holding that cash tonight. That said, we’re remaining flexible, too, as the major indexes aren’t in bad shape, the broad market’s resurgence has held so far and we’re heading into the meat of earnings season; given it all, we still think some fresh breakouts could occur if things go well. Thus, for now, we’re cautious, but we’re keeping our eyes open for opportunities.

There are any number of catalysts that can change the fortunes of a turnaround stock, but the easiest opportunity is simply leveraging the business cycle.

Going into last week we knew it had the potential to be a wild five-day stretch, and the market didn’t disappoint as the indexes swung violently, and sector rotation was intense. By week’s end the S&P 500 had fallen 1.55%, the Dow had rallied 0.5%, and the Nasdaq had lost 3.8%.

The shine seems to have come off gold and gold miners recently so we’re going to step aside from Alamos Gold (AGI) at just a hair above our entry price.

A good ‘til canceled (GTC) order can help you set the stage for dip-buying opportunities when they inevitably present themselves in the next down market.

We’ve seen plenty of split tapes in our day, but this one is about as divergent as we can remember, and this week was another example of it playing out. Coming into today, the big-cap Nasdaq was up about 3% on the week while the S&P 500 was up 1.5%—but outside of a couple of growth measures, the rest of the market was flat (up 0.5% to down), and that’s before what looks like a down opening this morning.

AST SpaceMobile (ASTS) is up more than 140% so far in 2024. What’s behind the rise of this space-based cellular broadband company?

Despite some troubling signs under the surface of the market, mega-cap tech once again led the indexes’ charge higher. And because of the heavy weighting of these tech stocks in the S&P 500 and Nasdaq, those indexes gained 1.8% and 3.75%, respectively, while the Dow fell 0.4% on the week.

Despite some troubling signs under the surface of the market, mega-cap tech once again led the indexes’ charge higher. And because of the heavy weighting of these tech stocks in the S&P 500 and Nasdaq, those indexes gained 1.8% and 3.75%, respectively, while the Dow fell 0.4% on the week.

Sell Second Quarter of EverQuote (EVER)

With the Juneteenth Holiday this week and our last update just three business days ago (and right after the FOMC meeting), there is very little to talk about today. So, I’ll keep things short and sweet and we’ll jump right into company-specific updates, of which there are hardly any.

In other words, enjoy a break in the action! They rarely last long.

While the gains/losses in the three major indexes were mostly muted last week, there was some interesting rotation out of the AI/Semiconductor theme and into recent underperformers … though this is hardly anything to write home about as it was just two days of this type of action.

By week’s end, the S&P 500 gained 0.65%, the Dow rose by 1.75%, and the Nasdaq fell marginally.

Despite “cracks” under the surface, a few key liquidity indicators highlight that the path of least resistance remains up, which could spell further pain for the market bears this summer.

Cannabis stocks are unloved and in the doldrums.

Typically, in the stock market, that’s the best time to buy.

Neglected stocks offer the best value, as long as there are potential catalysts on the horizon.

I believe that is the case with cannabis. You’ll just have to be patient. I think it is worth being patient for the possibility of 30%-50% gains when a catalyst strikes. There is no guarantee this will happen, but as I discuss below, the odds are good.

Just a quick housekeeping note. With the 4^th of July holiday next Thursday, I’m going to send out the July Issue one day earlier than normal. Look for it next Wednesday, July 3.

As the second quarter comes to a close, a quick look at the performance of small caps relative to large caps shows just how important stock picking has been this year, and especially once you step away from the influence of the Magnificent 7, which now make up almost 32% of the S&P 500.

While the gains/losses in the three major indexes were mostly muted last week, there was some interesting rotation out of the AI/Semiconductor theme and into recent underperformers … though this is hardly anything to write home about as it was just two days of this type of action.

By week’s end, the S&P 500 gained 0.65%, the Dow rose by 1.75%, and the Nasdaq fell marginally.