Dow Back Above 29,000 and Within 500 Points of a New High

The Dow jumped 1.6% on Wednesday, bringing its two-day total to approximately 670 points, as the market shows no signs of slowing down here at the beginning of September.

The index is back above 29K and now only about 450 points away from a new closing high.

The other indices have been setting new records for weeks now… and that continued today. The S&P was right behind the Dow with a surge of 1.54% to a fresh high of 3580.84.

The NASDAQ actually underperformed its counterparts this session, though it still advanced 0.98% (or nearly 117 points) to 12,056.44.

Apple (AAPL) was down a little more than 2% on Wednesday after surging over 7% in the previous two days. Overall, the FAANGs were mixed, though there were still strong results from Alphabet (NASDAQ:GOOGL) (GOOG, +4.07%) and Facebook (NASDAQ:FB, +2.39%).

We received another disappointing ADP employment report with private payrolls adding 428,000 jobs last month. That was less than half of expectations at over 1 million. However, it was a sharp improvement over the previous month.

This was the second straight report that substantially fell short of expectations. Fortunately, the market didn’t care much about either of these misses, since they're not considered bellwethers for the all-important government employment situation that comes out on Friday.

Last month, the BLS number still beat expectations despite the underperforming ADP report from a couple days earlier.

Friday’s report could certainly be a market mover, especially if it disappoints at a time when so many investors are nervous about a significant pullback of this super hot market.

Speaking of economic data, we’ll also be getting the ISM services report tomorrow. Last month, it was up to 58.1% (anything over 50% means growth). Just yesterday, the ISM manufacturing report rose to 56 for August.

Today's Portfolio Highlights:

Surprise Trader: Shares of Patterson Companies (NASDAQ:PDCO) have been on the rise ever since its last quarterly report in June, when it beat the Zacks Consensus Estimate by more than 150%. Now, this provider of dental and animal health products heads into its next report with an Earnings ESP of 14.77%. Dave thinks PDCO is all set for a fifth straight positive surprise before the bell tomorrow, so he added this “very quick turnaround idea” on Wednesday with a 12.5% allocation. He also sold Hain Celestial (NASDAQ:HAIN) today. Read the full write-up for more on today’s moves.

Value Investor: In just a few days, Aimmune Therapeutics (NASDAQ:AIMT) has moved from a loss of 25% in the portfolio to a gain of more than 100%! That’s what can happen when you have the only FDA-approved peanut allergy therapy and are getting bought by a food staple like Nestle for $2.6 billion. Now there’s no further upside for AIMT since it’s at the buy-out price and will stay there until the transaction is complete. Tracey sold the stock on Wednesday for a nice return of nearly 112% in less than five months. Speaking of great performances, this portfolio also had the biggest winner of the day among all ZU names as InMode (NASDAQ:INMD) rose 15.45%.

Home Run Investor: You’ve probably heard that tech is doing pretty well these days, so it’s no wonder that Brian wants more exposure to the space. Therefore, he added Perficient (NASDAQ:PRFT) on Wednesday, which is a leading digital transformation consulting firm. The company reported a solid quarter in late July that included a positive surprise of 18.75%. Rising earnings estimates have made PRFT a Zacks Rank #1 (Strong Buy). The editor also appreciated that operating margin rose to 9.7% from 9% over the past three quarters, which suggests more earnings beats are on the way. The stock jumped 10% since the quarterly report, and Brian wouldn’t be surprised if it moved another 20% at least. Read the full write-up for more on this new buy.

Have a Good Evening,
Jim Giaquinto