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Thursday, December 19, 2024
Signs of Health Are Stacking Up for Stocks
Last month, a huge cloud of market uncertainty lifted for investors. Donald Trump won the presidential election for a second term. And just about everything rallied on the news. The major stock indexes were all up 2.5%-plus the day after the election. The mid-cap benchmark – the S&P 400 Index – rose 4.1%. And small-cap stocks soared 6.1%.
Editor's note: Regular readers know that Marc Chaikin has remained "bullish" on stocks throughout this year...
And he still sees more upside ahead. Marc isn't alone, either. Over at our corporate affiliate Stansberry Research, our friend Brett Eversole has also seen plenty of strength in this market recently...
Today, we're sharing an essay from Brett with the details. It published in his free DailyWealth e-letter last Thursday. And in it, he explains why things have been "working" recently in the market...
Signs of Health Are Stacking Up for Stocks
By Brett Eversole, editor, Stansberry Research
Last month, a huge cloud of market uncertainty lifted for investors. Donald Trump won the presidential election for a second term. And just about everything rallied on the news.
The major stock indexes were all up 2.5%-plus the day after the election. The mid-cap benchmark – the S&P 400 Index – rose 4.1%. And small-cap stocks soared 6.1%.
Everyone will have a different explanation for why stocks roared higher. Some will say it was because Trump won. Others will say it was simply the removal of election-related uncertainty.
Either way, we know one thing... If you were worried about the health of this bull market, you don't need to worry anymore.
Marc Chaikin's Power Gauge flagged 44 of the top 50 stocks of 2024 in advance of their gains. He's stepping forward with a must-see market prediction for 2025... driven by a rare (staggering 93% historical accuracy) signal he has never shared before. Get the full story (and two free stock recommendations) here.
Bitcoin is skyrocketing after Donald Trump's presidential victory. And according to crypto expert Eric Wade, it's just getting started. A proposed federal program backed by the new administration is set to ignite a major new crypto bull run. To help you prepare, Eric just released an emergency briefing detailing six cryptos with 1,000% potential to act on immediately. Click here for his crypto update.
There are good bull markets and bad bull markets. In the bad ones, only a few stocks drive the market higher. And that eventually becomes a house of cards waiting to tumble.
In the good ones, everything rallies. There's strength across the board. And like it or not, that's exactly what we have right now.
Consider that during the postelection rally...
• Every major U.S. index hit an all-time high.
• The S&P 500 Equal Weight Index hit an all-time high.
• Mid-cap stocks hit an all-time high.
• Small-cap stocks hit an all-time high.
• Financial, transportation, and industrial stocks all hit all-time highs together, too... a sign of a strong economy.
For practical purposes, every important area of the market has been soaring.
If you still think the Magnificent Seven is the only group of stocks driving the market higher, you're dead wrong. This is as broad and healthy a period as we've seen since the bull market took off two years ago.
To see it another way, we can look at the advance/decline line of the New York Stock Exchange. This cumulative series takes the number of daily winners minus the number of daily losers, then adds the number to the previous day's total.
Basically, it's a way to see how many more stocks are rising than falling. When the advance/decline line is rising, most stocks are going up.
Importantly, we want to see this series hit new highs alongside the overall market. And that's exactly what has been happening. Take a look at the recent movement...
The advance/decline line isn't flashing a warning sign today. It's giving the boom a green light. This is as healthy a bull market as we could hope for.
That doesn't mean we will never see any surprises from here... That's always possible. It's also possible that the rally is starting to get ahead of itself. But that doesn't mean the good times are over.
The best time to make money is when things are working... when there's a broad and healthy rally in place. And that's exactly what we have right now.
You want to stay bullish until that changes.
Good investing,
Brett Eversole Editor's note: Again, Marc is still optimistic about stocks. And as we approach 2025, he has a critical update for the months ahead...
In short, Marc recently observed an important signal. And it tells him with 93% historical accuracy, based on 70 years of data, exactly what to expect from stocks over the next six months.
During a special event earlier this week, he shared all the details. But if you missed it, you're in luck... You can watch a replay of it right here.
Market View
Major Indexes and Notable Sectors
# Hld: Bullish Neutral Bearish
Dow 30
-2.61%
5
15
10
S&P 500
-2.99%
63
266
168
Nasdaq
-3.63%
22
49
29
Small Caps
-4.42%
396
1010
500
Bonds
-1.22%
— According to the Chaikin Power Bar, Large Cap stocks are more Bearish than Small Cap stocks. Major indexes are mixed.
* * * *
Sector Tracker
Sector movement over the last 5 days
Staples
-2.15%
Information Technology
-2.94%
Discretionary
-3.33%
Health Care
-3.39%
Utilities
-3.53%
Communication
-4.19%
Financial
-4.32%
Industrials
-4.51%
Real Estate
-5.3%
Materials
-5.72%
Energy
-6.87%
* * * *
Industry Focus
Oil & Gas Exploration & Production Services
1
24
27
Over the past 6 months, the Oil & Gas Exploration & Production subsector (XOP) has underperformed the S&P 500 by -17.95%. Its Power Bar ratio, which measures future potential, is Very Weak, with more Bearish than Bullish stocks. It is currently ranked #20 of 21 subsectors and has moved down 5 slots over the past week.
Indicative Stocks
CVX
Chevron Corporation
CRC
California Resources
CVI
CVR Energy, Inc.
* * * *
Top Movers
Gainers
JBL
+7.26%
CI
+6.33%
UNH
+2.92%
CNC
+2.91%
CVS
+2.82%
Losers
PAYC
-10.08%
TSLA
-8.28%
BXP
-7.63%
TPL
-7.41%
CRWD
-7.24%
* * * *
Earnings Report
Reporting Today
Rating
Before Open
After Close
ACN, CTAS, DRI, FDS, KMX, LW
CAG, PAYX
FDX, NKE
No earnings reporting today.
Earnings Surprises
GIS General Mills, Inc.
Q2
$1.40
Beat by $0.18
JBL Jabil Inc.
Q1
$2.00
Beat by $0.12
LEN Lennar Corporation
Q4
$4.03
Missed by $-0.09
MU Micron Technology, Inc.
Q1
$1.79
Beat by $0.02
* * * *
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