Since the inception of my premium newsletter, Top Stock Advisor, our goal has been to provide subscribers with a portfolio of some of the world’s greatest, most capital-efficient companies.  The result: A legacy portfolio that could be passed down from generation to generation… One that doesn’t expose you to unnecessary risk, yet still outperforms the market… A portfolio that can stand the test of time, weather unpredictable events, and mitigate the risk of uncertain economic futures. The presidential election gave us a taste of an unpredictable event — a stress test if you will. So how did the portfolio do?… Read More

Since the inception of my premium newsletter, Top Stock Advisor, our goal has been to provide subscribers with a portfolio of some of the world’s greatest, most capital-efficient companies.  The result: A legacy portfolio that could be passed down from generation to generation… One that doesn’t expose you to unnecessary risk, yet still outperforms the market… A portfolio that can stand the test of time, weather unpredictable events, and mitigate the risk of uncertain economic futures. The presidential election gave us a taste of an unpredictable event — a stress test if you will. So how did the portfolio do? 11 of 19. That’s the number of stocks that are positive since the day before the election. Of those 11 stocks, all but one of them has outpaced the broader market, as measured by the S&P 500. Overall, the portfolio increased roughly 1.5%, which is all the more remarkable considering that nearly 40% is in cash. —Recommended Link— The Most Expensive Piece Of This Car Could Make You Rich Sustainable energy is not cheap. In fact, it’s the most expensive component in an electric car. But Tesla founder Elon Musk is determined not only to make it affordable worldwide…… Read More

The major U.S. indices extended the previous week’s huge post-election gains, led by the small-cap Russell 2000 (2.6%) and tech-heavy Nasdaq 100 (1.2%). Although the S&P 500 only added 0.8%, the modest advance was broad based, with all sectors of the index posting gains except health care and consumer staples. Financial, energy and consumer discretionary stocks were the week’s best performers. The focus of this holiday-shortened week will be two housing-related reports and the minutes of the early November Federal Open Market Committee meeting. Investors will be poring over the minutes on Wednesday afternoon for clues as to whether the… Read More

The major U.S. indices extended the previous week’s huge post-election gains, led by the small-cap Russell 2000 (2.6%) and tech-heavy Nasdaq 100 (1.2%). Although the S&P 500 only added 0.8%, the modest advance was broad based, with all sectors of the index posting gains except health care and consumer staples. Financial, energy and consumer discretionary stocks were the week’s best performers. The focus of this holiday-shortened week will be two housing-related reports and the minutes of the early November Federal Open Market Committee meeting. Investors will be poring over the minutes on Wednesday afternoon for clues as to whether the Federal Reserve will hike short-term interest rates at the Dec. 13-14 meeting. In last week’s Market Outlook, I pointed out that the post-election rally positioned the benchmark S&P 500 index just below overhead resistance at 2,180 to 2,194. That resistance is officially being tested, but it will take a sustained rise above it to confirm the broader market’s next leg higher is underway. Investor Asset Flows Testing Important Threshold One of the few market metrics that actually leads price sometimes is investor asset flows. And the latest asset flows data in the SPDR Dow Jones Industrial Average ETF (NYSE: DIA)… Read More

If you want to start an instant argument, find adherents of technical analysis and adherents of fundamental analysis, and then ask them which investing approach is better. The technical analysts will tell you that a close read of a company’s financial statements won’t help you know if a stock represents a timely investment. The fundamental analysts will counter that simply looking at a series of trading charts only tells you where a stock has been, not where it is going. With all due respect, they are both wrong. —Recommended Link— Nail Down A 10%+ Income Stream For Life If… Read More

If you want to start an instant argument, find adherents of technical analysis and adherents of fundamental analysis, and then ask them which investing approach is better. The technical analysts will tell you that a close read of a company’s financial statements won’t help you know if a stock represents a timely investment. The fundamental analysts will counter that simply looking at a series of trading charts only tells you where a stock has been, not where it is going. With all due respect, they are both wrong. —Recommended Link— Nail Down A 10%+ Income Stream For Life If pulling down a yield of 10% a year sounds good — before capital gains — you need to see this. You’ll find stocks paying 15.1%… high-yielding REITs, trusts, partnerships and ETFs. (These cash cows are also posting capital gains as high as +368% for us. I explain that part here.) The real secret to successful investing is the marriage of both approaches. In fact, I’ve singled out a pair of factors — one from each camp — that can be used in tandem to deliver robust gains. It’s an approach that has led me to bag triple-digit gains, often in… Read More

In one of the strangest weeks for the markets that I can remember, the major indices collapsed during the overnight session on election night, with the S&P 500 plummeting 5% at one point, before staging a huge bullish reversal on Nov. 9. From there, the market just kept going, and… Read More

In last week’s report, I identified 2,121 as a key level to watch in the benchmark S&P 500, saying a breakdown below that level would clear the way for a deeper decline as we headed into Election Day. That is precisely what happened last week, as the major indices logged another weekly decline, led down by the Nasdaq 100 (-3%) and Russell 2000 (-2%).   Last week’s weakness was broad-based, with every sector of the S&P 500 finishing lower. The poorest performers were technology (-2.7%) and energy (-2.3%). We are at a major decision point where investors must draw some longer-term… Read More

In last week’s report, I identified 2,121 as a key level to watch in the benchmark S&P 500, saying a breakdown below that level would clear the way for a deeper decline as we headed into Election Day. That is precisely what happened last week, as the major indices logged another weekly decline, led down by the Nasdaq 100 (-3%) and Russell 2000 (-2%).   Last week’s weakness was broad-based, with every sector of the S&P 500 finishing lower. The poorest performers were technology (-2.7%) and energy (-2.3%). We are at a major decision point where investors must draw some longer-term conclusions as to where we are headed as a country. As is often the case, this political and economic decision point can also be seen in asset prices.  Stocks spiked on Monday, following news that the FBI said Hillary Clinton should not face criminal charges after a review of new emails. This action clearly indicates the market would be much more comfortable with a Clinton presidency. Fear Can Be a Good Thing Since mid-July, I have been warning that the extremely low market volatility — as evidenced by a reading in the Volatility S&P 500 (VIX) near 12 — would… Read More

All major U.S. indices finished in negative territory last week, giving back the previous week’s modest gains. They were led lower by the small-cap Russell 2000, which lost 2.5%. However, the four “majors” — the S&P 500, Dow Jones Industrial Average, Nasdaq 100 and Russell 2000 — are all still up 4% or more for the year. #-ad_banner-# The key level to watch is underlying support at 2,121 in the S&P 500, which has already been tested and held twice, on Sept. 12 and Oct. 13. A sustained decline below this level would represent a breakdown below the current three-month trading range. Read More

All major U.S. indices finished in negative territory last week, giving back the previous week’s modest gains. They were led lower by the small-cap Russell 2000, which lost 2.5%. However, the four “majors” — the S&P 500, Dow Jones Industrial Average, Nasdaq 100 and Russell 2000 — are all still up 4% or more for the year. #-ad_banner-# The key level to watch is underlying support at 2,121 in the S&P 500, which has already been tested and held twice, on Sept. 12 and Oct. 13. A sustained decline below this level would represent a breakdown below the current three-month trading range. It may also clear the way for a deeper sell-off in the weeks ahead. Last week’s strongest sectors were the defensive utilities (1%) and consumer staples (0.8%) groups, while real estate (-3.4%) and health care (-2.8%) were the weakest performers. Real estate was adversely affected by last week’s aggressive rise in long-term interest rates, which I will discuss in more detail later in the report. Market Fails To Rally From Oversold Conditions One way to determine the health of the market’s advance is by watching to see how it reacts to certain indicators and conditions. One of these conditions is… Read More

All successful stock market investors have one thing in common. Sure, they may have very different ideas and styles, but this one thing remains true across the board. No matter who you ask, from Warren Buffett to your local investment advisor, they will all agree on this single point.    #-ad_banner-#The point is there is a difference between price and value in the stock market. While the ordinary investor chases price, the winning long-term stock investor understands the importance of value. Understanding value enables you to purchase stocks that are underpriced in the market. These diamonds in the rough are often… Read More

All successful stock market investors have one thing in common. Sure, they may have very different ideas and styles, but this one thing remains true across the board. No matter who you ask, from Warren Buffett to your local investment advisor, they will all agree on this single point.    #-ad_banner-#The point is there is a difference between price and value in the stock market. While the ordinary investor chases price, the winning long-term stock investor understands the importance of value. Understanding value enables you to purchase stocks that are underpriced in the market. These diamonds in the rough are often stocks that will create wealth over the long term. One way to think about the difference between value and price is that value is real worth, while the price is nothing more than how much market participants are willing to pay. In other words, the price is often reflective of the herd mentality. And these numbers are typically far apart.   Investors are often willing to pay far more than stock is worth due to hype and upside price momentum. At the same time, stock prices can also be lower than the actual value of the stock. This is often… Read More

The major U.S. stock indices staged a very modest recovery last week. The fact that it was led by the tech-heavy Nasdaq 100, which rose 0.9%, is encouraging. However, historically low volatility, overly bullish investor sentiment and late-October seasonality warn that the market may not be out of the woods yet. Except for consumer staples (-0.3%) and industrials (-0.4%), all sectors of the S&P 500 finished in positive territory last week, led by materials (+1.6%) and financials (+1.2%). #-ad_banner-# Bigger picture, Asbury Research’s sector ETF-based metric shows that the biggest positive… Read More

The major U.S. stock indices staged a very modest recovery last week. The fact that it was led by the tech-heavy Nasdaq 100, which rose 0.9%, is encouraging. However, historically low volatility, overly bullish investor sentiment and late-October seasonality warn that the market may not be out of the woods yet. Except for consumer staples (-0.3%) and industrials (-0.4%), all sectors of the S&P 500 finished in positive territory last week, led by materials (+1.6%) and financials (+1.2%). #-ad_banner-# Bigger picture, Asbury Research’s sector ETF-based metric shows that the biggest positive percentage change in investor asset flows in the past one-month and three-month periods went into the energy sector, which is seen by many as a global economic barometer.  Investors Still Too Complacent Although I would love to show Market Outlook readers a different set of market metrics each week, my primary objective is to cover what I believe to be the most influential indicators to stock market direction at any given time. Given that criterion, market volatility remains at the top of the list.  The Volatility S&P 500 (VIX) index has been rising from a complacent extreme of 12 and… Read More

Last week, the major U.S. stock indices added to the previous week’s modest losses as investors seem to be wrapping their heads around an inevitable interest rate hike, which many believe will happen before the end of the year. The small-cap Russell 2000 (-2%) and tech-heavy Nasdaq 100 (-1.2%) led the way down, as they typically do, but the market weakness was broad based. All sectors of the S&P 500 closed lower except for utilities (+1.3%), real estate (+1.2%) and consumer staples (+0.1%). However, if interest rates manage to rise between now and year end, the gains in real estate… Read More

Last week, the major U.S. stock indices added to the previous week’s modest losses as investors seem to be wrapping their heads around an inevitable interest rate hike, which many believe will happen before the end of the year. The small-cap Russell 2000 (-2%) and tech-heavy Nasdaq 100 (-1.2%) led the way down, as they typically do, but the market weakness was broad based. All sectors of the S&P 500 closed lower except for utilities (+1.3%), real estate (+1.2%) and consumer staples (+0.1%). However, if interest rates manage to rise between now and year end, the gains in real estate and utilities are unlikely to last, as rising long-term rates act as a drag on home sales and make Treasuries more competitive for yield-seeking investor dollars. From an asset flows standpoint, Asbury Research’s own sector ETF-based metric shows that the biggest positive percentage change over the past one-month and three-month periods was in energy.   If this strength continues, it should push the energy sector higher, which would suggest a strengthening global economy and would bode well for higher equity prices overall into 2017. The Fear Factor In last week’s Market Outlook, I reviewed the Volatility S&P… Read More

The S&P 500 continues to trade within a relatively narrow four-month range, as investors await indication of when the Federal Reserve’s next interest rate hike will be and who will win the presidential election in November. The major U.S. stock indices closed only slightly lower last week, led down by the small-cap Russell 2000, which lost 1.2%. But a sector breakdown looks much worse, with every sector of the S&P 500 finishing the week in negative territory except for financials and energy. #-ad_banner-#The strength in financials was directly attributable to a big jump in long-term interest rates. The yield of… Read More

The S&P 500 continues to trade within a relatively narrow four-month range, as investors await indication of when the Federal Reserve’s next interest rate hike will be and who will win the presidential election in November. The major U.S. stock indices closed only slightly lower last week, led down by the small-cap Russell 2000, which lost 1.2%. But a sector breakdown looks much worse, with every sector of the S&P 500 finishing the week in negative territory except for financials and energy. #-ad_banner-#The strength in financials was directly attributable to a big jump in long-term interest rates. The yield of the benchmark 10-year Treasury note jumped from 1.56% on Sept. 27 to 1.75% on Oct. 6 — a 19-basis-point rise in just seven trading days. This move was apparently triggered by Fed Chair Janet Yellen’s semiannual testimony to the House Financial Services Committee, in which she said she expects the unemployment rate to move even lower but will not hold interest rates low for much longer.  Fear Continues to Act as an Invisible Lid on the Market I try to bring different charts and metrics into Market Outlook each week so it can be a learning tool as well… Read More