Back to New Highs as Investors Relax and Refocus

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The market avoided another final hour slump on Thursday, leaving a clear path for new highs in all the major indices.

The NASDAQ, which was the only index to make some history yesterday as well, continues to lead the way with an increase of 0.81% (or nearly 75 points) to 9203.43.

Technology remained among the hottest spaces in the market, with Apple earning special attention for rising approximately 2.1% after reports of iPhone sales surging more than 18% in China last month.

The ‘march to 29,000’ stories have already begun. The Dow is less than 50 points away from its latest milestone after advancing 0.74% (or almost 212 points) today to 28,956.90.

The index was helped by a 1.5% advance from Boeing after reports that the jet crash near Tehran earlier this week was likely an Iranian missile and not a mechanical problem.

The S&P is pretty close to its own psychological marker at 3300 with a gain of 0.67% to 3274.70.

That makes new record highs for all the indices! Unlike yesterday, the sentiment in the final hour was mostly positive.

We’ve calmed down dramatically since the Iranian airstrikes late Tuesday. The lack of casualties and of escalation have helped investors relax and re-focus on the mostly positive aspects of this market.

Case in point, it looks like the Phase 1 trade deal is on the verge of being signed. A Chinese delegation, including Vice Premier Liu He, will be in Washington next week to make it official (fingers crossed).

The first full week of 2020 ends tomorrow, and all of the major indices head into that final session with solid gains through the first four days. The NASDAQ has a four-week winning streak and the S&P will be looking to get back into the green after its five-week run was recently snapped.

Assuming there are no geopolitical issues on Friday, the big event that could make or break the week is the Government Employment Situation report.

A jobs report, a trade deal signing, earnings season, tensions with Iran and record highs. What a crazy way to start 2020!

Today's Portfolio Highlights:

Surprise Trader: With no end in sight to this amazing Wall Street rally, Dave thought it would be a good idea to add a 12.5% allocation in a giant money manager like BlackRock (BLK). This Zacks Rank #2 (Buy) has a positive Earnings ESP of nearly 4% for the quarter being reported before the bell next Thursday, January 15. Furthermore, BLK is part of the Financial – Investment Management space, which is in the top 24% of the Zacks Industry Rank. The portfolio also sold Simply Good Foods (SMPL) on Thursday. Read the full write-up for more on today’s moves.

Counterstrike: The market is back to new highs, which is a good time to secure some profit. On Thursday, Jeremy sold half of The Rubicon Project (RUBI) for a 17.7% return in just one week and all of Chipotle Mexican Grill (CMG) for a 13.7% profit in about two months. RUBI took off much faster than the editor considered, so he’s selling part of it a little quicker than expected as well. And CMG is close enough to Jeremy’s targets, especially with its earnings report right around the corner.

Blockchain Innovators: It may not seem like it, but there’s a whole lot of technology in corn seeds. That’s the point behind Origin Agritech (SEED), a Chinese agricultural biotechnology trait and corn seed technology provider. Basically, it uses blockchain to track corn seeds from planting through harvest and to distribution. SEED may be small, but revenues are on the rise and so is Dave’s interest in the name. He added it to the portfolio on Thursday. Make sure to read the full write-up for more specifics on the move.

Technology Innovators: There are few things more frustrating for investors than “seeing a big green number turn into a small green number”. That’s why Brian sold ACM Research (ACMR) on Thursday. This chip name has been “just too hot to handle” of late, so the editor thought the wise thing to do was sell the stock and secure an impressive 67% return in less than two months! He immediately replaced it by adding Anaplan (PLAN), a developer/publisher of a cloud platform for business applications. The company reported a solid quarter recently, which included a positive surprise of more than 38%. Read the full write-up for more on today’s moves.

Have a Good Evening,
Jim Giaquinto

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