The S&P broke out of its four-day slump on Thursday as we prepare to say goodbye to a strong month of June and get ready for the long-awaited meeting between President Trump and China President Xi at the G20.
The index hadn’t closed on the positive side since last Thursday, when it was also at a new record. Today it pushed forward by 0.38% to 2924.92.
The best performer today was the NASDAQ, which ended a three-day skid yesterday. It added 0.73% (or nearly 58 points) to those gains and ended the session at 7967.76.
The Dow would have joined its counterparts on the plus side if it weren’t for Boeing (NYSE:BA). The aerospace giant said that the latest software update for the 737 Max may not be completed until September, which means those planes will stay grounded for a while longer.
BA stock was down 2.9%, which pulled the Dow lower by 0.04% (or a little over 10 points) to 26,526.58.
Everything was going great in June until this week. The indices now go into the final session with their three-week winning streaks in jeopardy.
The big blow came on Tuesday when Fed officials seemed less-than-certain that a big rate cut was coming in July.
But June is still looking very solid for stocks, especially after May became the first month of 2019 in the red. Plus, the three major indices remain just a stone’s throw away from hitting new records.
Perhaps this weekend’s G20 meeting will provide the catalyst that launches stocks to new highs.
This whole week has been a waiting game and we’re not done yet. Trump and Xi won’t meet until Saturday, so we’ll still be at the mercy of any headlines or Tweets as we close out the month tomorrow. Let’s hope we get some good ones…
Today's Portfolio Highlights:
Options Trader: In addition to rising sales and earnings estimates, alternative energy company Evergy (EVRG) also has a bullish chart pattern. Kevin decided to add this Zacks Rank #2 (Buy) on Thursday by buying to open 4 Dec 60.00 Calls. The editor also sold to close the 2 Dec 70.00 Calls in Tetra (TTEK) for a 127% return, and then repositioned with the ‘original’ amount by buying to open 2 Dec. 80 Calls. Finally, it looks like the 'easy money' in Aflac (NYSE:AFL) has been made, so the portfolio sold to close the 3 Jan 50.00 Calls on Thursday and banked an 80% profit. Read the full write-up for a lot more on all these moves.
Blockchain Innovators: When DASAN Zhone Solutions (DZSI) hired Michael Golomb as their CFO, this global leader in network access solutions was pretty much announcing its interest in blockchain and AI technologies. One look at Mr. Golomb’s resume and you see that he is quite literally a blockchain innovator. Therefore, Dave considers the addition of DZSI today as a “bet the jockey” play. Meanwhile, the company is coming off a very strong quarter with a more than 131% earnings surprise, while EPS growth for this year is slated at 185%. The full write-up has more on today’s addition of DZSI.
Counterstrike: The recent momentum in the tech space is making the addition of Xilinx (NASDAQ:XLNX) look even better. Jeremy added this programmable devices developer on June 13 because he likes the technical set-up of this one-time Wall Street darling. He added 5% to the position on June 24 as it looked on the verge of a breakout. And today he added another 5%. A busy month for XLNX! Read more in the complete commentary.
Value Investor: Despite 5 straight quarters of positive surprises, shares of furniture maker Herman Miller (MLHR) have been stuck. Well, its fiscal fourth quarter report last night might have finally freed the stock. Shares jumped 16.3% today to easily become the best performer among all the portfolios. MLHR beat the Zacks Consensus Estimate by 12.8%, which was the biggest surprise in what is now 6 straight quarters of EPS outperformance. Revenue also topped our expectations by rising to $671 million.
All the Best,
Jim Giaquinto
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