The U.S. stock market closed modestly higher last week, notching its fourth consecutive weekly gain. It was led by the defensive Dow Jones Industrial Average, which advanced 1.2%. The market was held in check by major overhead resistance levels in the Dow and S&P 500, which I will discuss in detail in a moment. #-ad_banner-# All sectors of the S&P 500 finished in positive territory last week, led by energy. As I pointed out in the previous report, Asbury Research’s metric showed energy has had the biggest sector-related inflow of investor assets over the past month, which fueled… Read More

The U.S. stock market closed modestly higher last week, notching its fourth consecutive weekly gain. It was led by the defensive Dow Jones Industrial Average, which advanced 1.2%. The market was held in check by major overhead resistance levels in the Dow and S&P 500, which I will discuss in detail in a moment. #-ad_banner-# All sectors of the S&P 500 finished in positive territory last week, led by energy. As I pointed out in the previous report, Asbury Research’s metric showed energy has had the biggest sector-related inflow of investor assets over the past month, which fueled its gains. Since its Jan. 20 low, the Energy Select Sector SPDR ETF (NYSE: XLE) is up 24.9%, outperforming the S&P 500 by 13.3 points. As long as investor assets continue to flow into energy, the recent strength is likely to continue. Market Tests Major Resistance But Leaning Higher In the Feb. 29 Market Outlook, I identified a bullish chart pattern in the Dow that targeted a move to 17,500. The index has since risen 3.5% into Friday’s 17,213 close, putting it just above formidable overhead resistance at 17,153 to 17,210. This resistance corresponds to significant resistance near 2,020 in the… Read More

Ask most investors where the next big consumer story will be and the answer is usually China. More than 400 million shoppers went online last year in the world’s second largest economy, more than the entire U.S. population. Besides natural growth in middle-class buying power, the government is doing all it can to transition the economy to a model fueled by consumer spending.  There’s a lot to like about companies that can sell into the Chinese consumer theme — but uncertainty over the country’s economic growth is destroying sentiment even on strong long-term potential. The Global X China Consumer ETF… Read More

Ask most investors where the next big consumer story will be and the answer is usually China. More than 400 million shoppers went online last year in the world’s second largest economy, more than the entire U.S. population. Besides natural growth in middle-class buying power, the government is doing all it can to transition the economy to a model fueled by consumer spending.  There’s a lot to like about companies that can sell into the Chinese consumer theme — but uncertainty over the country’s economic growth is destroying sentiment even on strong long-term potential. The Global X China Consumer ETF (NYSE: CHIQ) is 35% off its 52-week high and just 13% above the all-time low. #-ad_banner-#What if there were a company that would be one of the biggest long-term beneficiaries of the China consumer story but that had hidden exposure to the developed U.S. consumer story to boot? What if that same company was becoming indispensable to its main competitor, a critical part of the supply chain for one of the competitor’s fastest growing segments? The company exists and its shares are on sale. This Pick Gets Huge Support From Amazon And The American Consumer Fulfillment by Amazon (FBA)… Read More

A word of advice to investors who remain leery of Target Corp. (NYSE: TGT): Set aside any lingering doubts and get back into the stock. Target’s on the mend after recent setbacks. #-ad_banner-#I’m referring, of course, to the discount retail giant’s infamous 2013 security breach that exposed the credit card data of some 70 million customers. Also that year, Target kicked off what would prove to be a brief, poorly executed attempt at Canadian expansion. That ended abruptly early last year with a $5.4 billion write-down and roughly $2 billion in net losses. All this crushed the bottom line, with… Read More

A word of advice to investors who remain leery of Target Corp. (NYSE: TGT): Set aside any lingering doubts and get back into the stock. Target’s on the mend after recent setbacks. #-ad_banner-#I’m referring, of course, to the discount retail giant’s infamous 2013 security breach that exposed the credit card data of some 70 million customers. Also that year, Target kicked off what would prove to be a brief, poorly executed attempt at Canadian expansion. That ended abruptly early last year with a $5.4 billion write-down and roughly $2 billion in net losses. All this crushed the bottom line, with Target posting more than a $1.6-billion net loss in the 12 months ended January 31, 2015 versus a $3-billion profit two years earlier. Target’s stock was in or near bear territory during much of these turbulent times and the firm’s image suffered, putting management in the unenviable position of having to win back both customers and investors. But much has changed since then. Under new CEO Brian Cornell, a three-decade retail and consumer products veteran who took command right in the middle of the tumult, Target and its stock are executing a decisive turnaround. One key move: divesting… Read More

In January I warned StreetAuthority’s premium newsletter subscribers against overreacting. The markets were in a tailspin, officially crossing into correction territory just two weeks into the year.  However, I also said in a follow-up that it would be prudent to begin making a shopping list. #-ad_banner-#Today, we find ourselves in a market that has shown some signs of strength. Oil prices have rallied about 31% since mid-February, propelling the Dow Jones Industrial Average on a 1366-point rally. The S&P 500, meanwhile, is up roughly 8.8% since then. Aside from firming oil prices, there are other developments I’ve… Read More

In January I warned StreetAuthority’s premium newsletter subscribers against overreacting. The markets were in a tailspin, officially crossing into correction territory just two weeks into the year.  However, I also said in a follow-up that it would be prudent to begin making a shopping list. #-ad_banner-#Today, we find ourselves in a market that has shown some signs of strength. Oil prices have rallied about 31% since mid-February, propelling the Dow Jones Industrial Average on a 1366-point rally. The S&P 500, meanwhile, is up roughly 8.8% since then. Aside from firming oil prices, there are other developments I’ve seen that lead me to believe that the rampant selling is beginning to abate. Back on January 15 (the very same day I warned readers to not overreact to the market by panic), my colleague Jimmy Butts noticed that his Maximum Profit system was throwing up some major warning flags. (I’ve covered how Jimmy and his readers use the Maximum Profit system to identify fundamentally-sound stocks with momentum to deliver quick gains. I won’t recap the mechanics of the entire system today. But for more, read this or this.) When he… Read More

From 2008 to 2013, organic and natural foods retailer Whole Foods Market (NYSE: WFM) was a superstar. But backlash over its high prices and a reduced outlook ended the rally and sent the stock into a death spiral.  WFM was one of 2014’s worst performers on the S&P 500. But after the decline culminated in a nearly 20% single-day loss in May 2014, the stock consolidated in a low range for six months — healing before finally waking up again. #-ad_banner-# Fast forward to today and WFM is again healing in a low range following a disastrous 2015. Read More

From 2008 to 2013, organic and natural foods retailer Whole Foods Market (NYSE: WFM) was a superstar. But backlash over its high prices and a reduced outlook ended the rally and sent the stock into a death spiral.  WFM was one of 2014’s worst performers on the S&P 500. But after the decline culminated in a nearly 20% single-day loss in May 2014, the stock consolidated in a low range for six months — healing before finally waking up again. #-ad_banner-# Fast forward to today and WFM is again healing in a low range following a disastrous 2015. But it’s also showing signs of life, so this could be deja vu all over again. Whole Foods Setting Up For A Strong 2016?  Whole Foods is in the consumer staples group, which is one of the only sectors showing strength year to date, although one could argue that organic quinoa and wild goji berries are not exactly items consumers can’t live without. However, we are seeing a strong trend toward natural and organic foods, with the global organic food market estimated to grow at a double-digit compound annual rate through 2020.  As we can see on the chart below, Whole… Read More

The world economy is constantly on the move. Emerging countries struggle to shift into consumer-driven industries, while developed countries continue to push the boundaries of new technology. And if there’s one thing that’s become clear over the past few years, it’s this: Data is big business. The globalization of data accounted for $2.8 trillion of the world’s GDP in 2014, and it’s the result of an astronomical rise in technology. That’s good for a 10.1% rise in global GDP over 10 years.  McKinsey & Co.’s report “Digital Globalization: The New Era Of Global Flows” says that “[data… Read More

The world economy is constantly on the move. Emerging countries struggle to shift into consumer-driven industries, while developed countries continue to push the boundaries of new technology. And if there’s one thing that’s become clear over the past few years, it’s this: Data is big business. The globalization of data accounted for $2.8 trillion of the world’s GDP in 2014, and it’s the result of an astronomical rise in technology. That’s good for a 10.1% rise in global GDP over 10 years.  McKinsey & Co.’s report “Digital Globalization: The New Era Of Global Flows” says that “[data flow] is projected to increase by an additional nine times over the next five years as flows of information, searches, communication, video, transactions, and intracompany traffic continue to surge.” #-ad_banner-#But what does that really mean? Data flows include things like digital transactions, communications, digital information and networks. It’s a vast “economy” that doesn’t necessarily stand on its own, like, say global trade does. Physical goods are easy to understand. Someone wants to buy a widget, so they buy one from a company that makes widgets. What the digital economy does is allow that customer to find that widget on the… Read More

Interest rates are at record lows across the globe. In the United States, the S&P 500 offers a dividend yield of around 2%, barely enough to keep up with record low levels of inflation. Fixed-income securities are even worse. The iShares 10-20 Year Treasury Bond (NYSE: TLH) is yielding 2%, close to an all-time low. CDs and savings accounts offer virtually no return. In this environment, investors are desperate for strategies that will help them generate consistent and reliable income. #-ad_banner-#Most investors are content to stick with dividend-paying blue-chip stocks in defensive industries. Read More

Interest rates are at record lows across the globe. In the United States, the S&P 500 offers a dividend yield of around 2%, barely enough to keep up with record low levels of inflation. Fixed-income securities are even worse. The iShares 10-20 Year Treasury Bond (NYSE: TLH) is yielding 2%, close to an all-time low. CDs and savings accounts offer virtually no return. In this environment, investors are desperate for strategies that will help them generate consistent and reliable income. #-ad_banner-#Most investors are content to stick with dividend-paying blue-chip stocks in defensive industries. This makes sense. Stocks like Verizon (NYSE: VZ) are not particularly sensitive to economic cycles. Even if the economy falls into a recession, very few people will cancel or change their mobile service. That’s why Verizon was just one of a few S&P 500 companies able to grow its dividend through the financial crisis in 2008 and 2009. Its current 4.4% yield ranks as one of the best dividends in the S&P 500 — well above the index’s average yield of 2%. I also consider Verizon to be one of the safest dividends in the… Read More

Donald Trump, the real estate mogul and reality TV star, continues to gain ground in his quest to become the 45th President of the United States. He also continues to face opposition, as leaders of the Republican party lash out against Trump’s seemingly bombastic tactics.  #-ad_banner-#Granted, Trump has laid out some aggressive tax and national security plans, but he’s resonating with a large number of supporters.  Trump is leading all other Republican candidates in both delegate count and in popularity polls. And in some general election polls, Trump has been neck-and-neck with Democratic front-runner Hillary Clinton. Whether Trump can maintain… Read More

Donald Trump, the real estate mogul and reality TV star, continues to gain ground in his quest to become the 45th President of the United States. He also continues to face opposition, as leaders of the Republican party lash out against Trump’s seemingly bombastic tactics.  #-ad_banner-#Granted, Trump has laid out some aggressive tax and national security plans, but he’s resonating with a large number of supporters.  Trump is leading all other Republican candidates in both delegate count and in popularity polls. And in some general election polls, Trump has been neck-and-neck with Democratic front-runner Hillary Clinton. Whether Trump can maintain his momentum and dispel the naysayers remains to be seen. However, investors would be foolhardy not to consider what a Trump presidency may hold for their portfolios.  So which companies could benefit from President Trump’s policies?  Discretionary Stocks Could See A Boost One of Trump’s planned tax breaks includes increasing the number of low income households that don’t pay taxes. Additionally, his platform includes a rate cut for corporations, to 15% from 35%. These cuts have the potential to spur economic growth.  More money in people’s pockets means that consumer discretionary stocks should do well. The best play on… Read More