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There are a lot of reasons why it’s easier to make more money if you already have money. But I will just focus on one undisputable fact, the rich have access to opportunities and investments that most of us do not.

Private equity (PE) or venture capital (VC) is a shining example of such privileged access. PE or VC is money provided to young and growing businesses that otherwise wouldn’t have access to sufficient capital. For ages, these highly profitable investments had been the sole domain of the very wealthy who were able to make fortunes by lending to growing companies at very favorable terms for themselves.



But times are changing.



As financial markets have grown in sophistication, private equity investing is no longer the exclusive domain of the wealthy. There are securities trading on the market today that enable regular investors to mimic the very same money-making strategies employed by the rich and famous.



In this issue, I highlight one of the very best such securities on the market. It has a phenomenal track record with a high dividend yield and a catalyst to move higher in the near future. These companies also tend to thrive in a strong economy and at this point in the economic cycle.

Last week all the major indices took a small step back. The S&P 500 lost
1.69%, the Dow fell 2.15%, and the Nasdaq declined 1.61%.



The headlines say the 5-day pullback was the largest for the S&P 500 since February. But considering that the streak of over 230 days without a 5% pullback is still in play, the short-term bearish stretch last week was minimal.



And even with the slight pullback last week, my sentiment has not changed. I remain
“cautiously optimistic” until I see market action that changes my mind.



Of course, if we see further continuation of the recent bearish trend, I might begin to shift my outlook. But a week doesn’t make a trend, and again we must remember we are only a few percentage points from all-time highs.

Ahead of the long holiday weekend, it was a mixed bag last week as the S&P 500 rose 0.58%, the Dow lost 0.25%, and the Nasdaq climbed 1.55%.



This week traders will keep a close eye on inflation as the Labor Department releases its August index of U.S. wholesale prices, otherwise known as the producer price index. The market is estimating an increase of 0.5%, after 1% increases in June and July. July witnessed a 7.8% increase year over year, which was the largest bump in over a decade. Another spike would not bode well for the overall market, so I will be keeping an eye on the release and its impact on price action.



With that in mind, and always an eye on diversification, this week’s pick is a steel and iron enterprise company.

First off, due to our regular schedule (two weeks off all year), there will be no Top Ten next Monday (November 22), though we will likely do a Movers & Shakers update pre-Thanksgiving.

Onto the market, big picture, we remain quite bullish, but near term, we think there’s the possibility of further shenanigans—we’re seeing a few stocks crack key levels, and with most measures of sentiment showing complacency/giddiness, more pain could be in store to raise the discomfort level. We advise following the tried-and-true method of holding your strong, resilient stocks, while keeping stops in place on names that are beginning to wobble. We’re pulling our Market Monitor back down to a level 7 to respect the recent iffy action, though we still think the next big move is up.



This week’s list has a lot of good-looking charts, including another batch of names that recently reacted well to earnings. Our Top Pick is one of those, with a story benefiting from both housing and long-term growth trends.

Stock Name	Price	Buy Range	Loss Limit
AppLovin Corporation (APP)	103	96-101	83-86
CF Industries (CF)	66	62.5-65.5	56-57.5
Diamondback Energy (FANG)	111	107-112	98-101
Expedia Group (EXPE)	178	174-178	163-165
The Goodyear Tire & Rubber Company (GT)	23	22-23	19.5-20
GXO Logistics (GXO)	99	93-96	84-86
LendingClub (LC)	44	40-42	34.5-36
Livent Corporation (LTHM)	30	28-30	25-26
Seagate Technology (STX)	106	100-104	91-93
Trex Company (TREX)	129	126-130	110-112

The market continued to test new highs last week as the S&P 500 gained 0.71%, the Dow climbed 0.87%, while the Nasdaq broke trend by closing 0.9% lower. That being said, we continue to see thin summer trading led by ongoing sector rotation. Growth waned last week and it was the cyclicals’ time to shine, with the financials leading the way.

The three leading indexes pushed higher this past week as the S&P 500 rose 0.78%, the Dow gained 1.22%, and the Nasdaq added 0.08%.



Following a choppy and volatile start to the week, on Thursday politicians kicked the debt-ceiling can down the road, which seemed to make investors happy, at least for the day. Unfortunately, that investor excitement was short-lived as the September jobs report on Friday came in at 194,000 new jobs added, well under the expectation of 500,000. The market managed to close Friday only slightly lower despite the bad news.

The overall market continues to trade without much conviction at the moment. Last week, the S&P 500 fell 0.37%, the Dow declined 0.36% and the Nasdaq pulled back 1.11%. As I’ve pointed out over the past few weeks, the bullish surge has been somewhat tainted by what has been going on below the market’s surface recently. Ideally, in a bullish environment, we would see healthy participation in most stocks, but that just hasn’t been the case over the past few weeks. As a result, I will continue to take a cautious, but certainly optimistic approach.

Last week the major indices took another small step backwards. The S&P 500 lost 0.57%, the Dow fell 0.06%, and the Nasdaq declined 0.41%.



The decline deepened among all the major indices Monday as ongoing uncertainties around Chinese property developer Evergrande heightened. Evergrande faces a debt payment on its offshore bonds Thursday, so until some clarity is seen I would expect to see further volatility.



The S&P 500 has now witnessed a 4.4% decline since the closing highs back on September 2. So the 5% pullback everyone has been discussing over the past several weeks could come to fruition over the next few trading sessions.



To be more defensive, this week I am going to sell in-the-money calls to stay a bit on the safe side.

This week I’m continuing to diversify my overall portfolio exposure by adding American subscription-based software company ZoomInfo (ZI).

Last week, despite a large market decline on Monday, the major indices took a baby step forward. The S&P 500 gained 0.51%, the Dow rose 0.62%, and the Nasdaq eked out 0.02%.



The advance came despite ongoing uncertainties around Chinese property developer Evergrande and the seemingly hawkish message from the Fed announcement. Now the focus has shifted to Washington, D.C.’s finest and the decision around the debt ceiling and infrastructure. Add a sprinkle of Chinese power concerns and there seems to be just enough worry to keep investors on their toes.

The bulls continued their winning ways last week, but the advance wasn’t without some jostling. Late in the week several leading growth stocks pulled back, but those declines weren’t enough to keep the bulls from another weekly victory.

The S&P 500 gained 0.93%, the Dow advanced 0.78% and the Nasdaq rose 1.11%.



To put this market run into perspective, the current rally has lasted 189 days, basically nine months, without a 5% pullback. Additionally, there have been 43 days of a recorded new high.



So, my stance hasn’t changed too much. I continue to take a cautious but optimistic approach.

Before we dive too deep into this week’s idea I have decided to sell our PureStorage (PSTG) stock position, which will leave us without a stock or option positions, as the stock has not been participating in the recent market rally. This could prove to be a mistake, but I would prefer to lock in our small profit, while at the same time raise some cash for upcoming trades.



Moving on …



The market added to recent gains last week, as the S&P 500 had its best week since July. The S&P 500 rose 1.8%, the Dow climbed 1.6%, and the Nasdaq added 2.2%.



The rally came on the back of better-than-expected earnings from several well-known stocks. The big banks dominated the earnings calendar and the sector’s pandemic-era trading boom fueled the continued bullishness.

Up, up and away! The S&P 500 rose 1.52%, the Dow advanced 0.96%, and the Nasdaq climbed 2.82% last week, aided by Federal Reserve Chairman Jerome Powell’s dovish commentary.

There is no doubt this year’s rally has been one of the most impressive rallies market participants have ever seen. More than 50 new closing highs and over 200 trading sessions without a 5% pullback defines the power and consistency of this rally. And as we have all witnessed, the slightest pullback seems to act as a frenzied feeding ground for buyers.

Fueled by better-than-expected earnings last week the S&P 500 rose 1.6%, the Dow climbed 1.1%, and the Nasdaq added 1.3%.



Despite the strong week, on Friday traders’ enthusiasm for the recent rally faded a bit after Fed Chairman Jerome Powell’s commented that the central bank was “on track” to begin reducing its purchases of assets.



However, Monday the bulls stepped right back in and once again “bought the dip.”



This week brings earnings announcements from key mega-cap tech names Amazon (AMZN), Facebook (FB), Alphabet (GOOG), and Apple (AAPL). There is also a bevy of blue chips reporting including United Parcel Service (UPS), Visa (V), McDonald’s (MCD), Coca-Cola (KO), Boeing (BA), Merck (MRK), Caterpillar (CAT) and numerous others. Brace yourself, it’s going to be exciting!
Energy has taken off lately and I want to add exposure to the sector. However, I still want to maintain a somewhat conservative stance, especially as this week’s pick will report earnings next week. As a result, I will be selling in-the-money calls on hydrocarbon explorer Marathon Oil (MRO).

Inflation was the focus last week with the release of the much-anticipated producer price index (PPI) and the consumer price index (CPI). Both came in well above expectations. CPI came in at 6.2%, which was the highest level seen in over 30 years, while the PPI was 8.6%, the highest in more than 10 years. These data points flamed the inflation fears that many had been anticipating for the past several months.



And while inflation is going to continue to be a worry for the bulls, as of last Friday, 460 of the companies that reside in the S&P 500 have reported earnings, with 80% outperforming expectations, a number which has far outperformed analyst expectations.



Speaking of strong earnings, this brings to me to this week’s idea which is a global leader in the tire market, and which just reported a strong third-quarter earnings report.

Current Market Outlook


In true 2021 fashion, just when the market looked ready to go over the falls last week the buyers stepped in, pushing the major indexes sharply higher (recouping nearly 50% of the month-long correction in just three days and seeing many individual stocks pop as well). It’s certainly encouraging, but we need to see a bit more—by our measures, we haven’t seen confirmation of a new intermediate-term uptrend (most indexes remain below their 50-day lines or stuck in the middle of multi-month ranges) and, while a few stocks have popped to new highs, most individual names are in the same no-man’s-land environment. Longer term, the strong, broad bounce is a good sign the overall bull market is alive and well, but near term, it’s still uncertain whether we’ll see another leg lower or more vicious rotation. You shouldn’t be in your bunker, but keeping new buys small and holding some cash makes sense as we see if the strength can persist.

This week’s list is heavier on turnaround and commodity-related names, with many beginning to emerge from long rest periods. Our Top Pick is LPL Financial (LPLA), which won’t be your fastest mover but has staged a good-looking breakout in recent weeks.

Stock Name	Price	Buy Range	Loss Limit
Acuity Brands (AYI)	206	203-210	182-185
Applovin (APP)	87	83-86	73-74.5
Builders FirstSource (BLDR)	55	54.5-56	49-50
The Goodyear Tire & Rubber Company (GT)	19	18-19	16.3-16.8
Hilton Worldwide Holdings (HLT)	143	139-142	126-128
LPL Financial Holdings (LPLA)	167	165-169	148-150
The Mosaic Company (MOS)	42	39-41	35-36
Pioneer Natural Resources (PXD)	193	187-192	165-168
Teck Resources Limited (TECK)	28	26-27.5	23-24
UPST (UPST)	311	285-300	240-250