Stocks Stuck in a Rut

It was more of the same on Wednesday. The market continues to worry about slowing growth and inverted yields, which led to another wild and ultimately negative session for the major indices.

However, stocks did come well off the lows by the closing bell.

So how wild was it? The Dow plunged about 230 points at its worst of the day and was up around 100 points at its best. We’ve seen a lot of this volatility lately as the bulls and bears struggle for control at this sensitive time for the market.

The index saw its first red of the week with a slip of 0.13% (or about 32 points) to 25,625.59.

The battle line for the S&P appears to be right at 2800, as the index can’t seem to move very far from the mark. However, it did stay above the number today by declining only 0.46% to 2805.37. The NASDAQ had the worst of it with a slide of 0.63% to 7643.38.

These two indices have been down in three of the last four sessions.

By the way, shares of Apple gained 0.9% on Wednesday for the iPhone maker’s first positive close since announcing a suite of new services earlier this week. It had dropped 1% on each of the previous two days.

Now would be a great time for one of those positive trade headlines. The market feels stuck at the moment and could really use something to snap out of its trance. Otherwise, we could remain listless for a while and eventually decide to move lower. We’re still weeks away from the next earnings season and who knows how far from a trade agreement with China.

Fortunately, Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer should be in China tomorrow for a new round of talks, while Vice Premier Liu He will be headed to Washington the following week. Hopefully, they’re getting closer to a real agreement. Think positive!

Today's Portfolio Highlights:

Home Run Investor: Remember how those expensive Canada Goose coats were suddenly everywhere? Well, Brian Bolan thinks he may have found the next big thing in Clarus Corp. (CLAR). This specialty retailer focuses on outdoors and climbing-related gear. To be clear, the editor doesn’t think that mountain climbing is going to take the country by storm, but just that this gear could get very popular in the mainstream. Rising earnings estimates have made CLAR a Zacks Rank #1 (Strong Buy) and Brian also likes its valuation. Read the full write-up for more on this new addition.

TAZR Trader: Kevin thinks the market has topped out for now and could struggle breaking out above 2830 or so. Therefore, the editor sees this as a good time to capitalize on a short-term rush for the exits. On Wednesday, he added ProShares UltraPro Short Dow30 ETF (SDOW) and ProShares UltraPro Short QQQ ETF (SQQQ). Read the full write-up for a lot more on these moves.

Value Investor: We knew that Shoe Carnival (SCVL) was going to report a good quarter because it already preannounced, but Tracey was concerned that this small-cap family footwear retailer wouldn’t enjoy a positive reaction from the market. She didn’t have to worry. On Wednesday, shares of SCVL soared 22.4% after the company easily beat earnings expectations for its fiscal fourth quarter while same-store sales jumped 4.7%. Net sales of $234.7 million were slightly below last year, but this quarter included one less week than a year ago. Needless to say, SCVL was the best performer of the day by a wide margin.

Until Tomorrow,
Jim Giaquinto

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