SPECIAL ALERT: Remember, we need your input to make next week’s new Zacks Ultimate Strategy Session episode the best it can be. There are two ways you can participate:
1) Zacks Mailbag: In this regular segment, Kevin Matras answers your questions ranging from current market conditions, general investing wisdom, usage of the Zacks Rank or any resources of Zacks.com and more. Pretty much anything goes.
2) Portfolio Makeover: Sheraz Mian and Dr. John Blank review a customer portfolio to give feedback for improvement. No need to send us personal information such as dollar value of holdings. Simply email us with all of the tickers you own.
Just make sure to email your submissions for either one, or both, by Thursday morning, November 5. Email now to mailbag@zacks.com.
We didn’t have as clean of an election as we would’ve liked – in fact, there’s still no clear winner – but the market took it in stride and put together its third straight rally.
Technology was the star on Wednesday with the NASDAQ soaring 3.85% (or about 430 points) to 11,590.78. The FAANGs were all impressively higher with Facebook (NASDAQ:FB) leading the way by soaring 8.3%.
Meanwhile, Amazon (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL) (GOOG) were each up 6% or more, while Apple (NASDAQ:AAPL) gained over 4% and Netflix (NASDAQ:NFLX) rose 2%.
The S&P soared 2.2% to 3443.44 and the Dow advanced 1.34% (or about 367 points) to 27,847.66.
While the presidential election captured most of the country’s attention, you could say that the market was more interested in Congress. The only scenario that really made investors nervous was the so-called “Blue Wave”, whereby one party would have complete control of the government.
But as of this writing, it looks like we’ll still have a divided legislature with the Senate staying in Republican hands, so there’ll be a check regardless of who wins the Oval Office.
That was apparently good enough for stocks on Wednesday. However, the longer this election is drawn out, the more pressure it could put on the market.
In other news – yes, there was other news – the ADP employment report showed private payrolls added 365,000 jobs in October.
The result missed expectations and was way below the previous month’s read of around 750K. It’s a reminder that the economic recovery is slowing down and whoever’s in charge next needs to pass some stimulus.
Also, ISM Services came in at 56.6% for October, which also missed expectations and was down from the previous month. However, its still solidly above 50 (expansion) and marks the fifth straight month of growth.
The Fed started its two-day meeting today as well. They’re not expected to make any changes, but we’ll learn more about that tomorrow with Chair Jerome Powell. He’ll probably steer clear of any comments on the election, but will certainly be stressing the need for more stimulus.
Today's Portfolio Highlights:
Home Run Investor: The plan now is to get this portfolio back to being fully invested, and Brian took a step in that direction by adding Altra Industrial Motion (NASDAQ:AIMC) on Wednesday. The company is a leader in a diversified range of motion control, electromechanical power transmission and automation products. AIMC reported big earnings surprises in the past three straight quarters and now has a four-quarter average beat of 50%. Rising earnings estimates make the stock a Zacks Rank #1 (Strong Buy). The editor is even impressed with its valuation. Make sure to read his complete commentary for more specifics on this new addition.
TAZR Trader: After three days of rallies, Kevin thinks it’s a good time to raise some cash to prepare for the future. Therefore, he banked three double-digit winners on Wednesday. The portfolio sold half of Quidel (NASDAQ:QDEL) for a nice gain of 63.5% in a little over two months, while also selling a third of Alibaba (NYSE:BABA) for a 50.9% return in just about six months. The editor sold half of Alteryx (NYSE:AYX) as well for 13.1% in about three months.
Healthcare Innovators: The healthcare space had a good session on Wednesday because they love the idea of a divided Congress. As a result, this portfolio had two of the biggest winners among all ZU names today. Global Blood Therapeutics (NASDAQ:GBT) was actually the best performer of all with a gain of 14.6%. The company also reports tomorrow. Meanwhile, Neurocrine Biosciences (NASDAQ:NBIX) made the list with a rise of 13%.
Until Tomorrow,
Jim Giaquinto
Recommendations from Zacks' Private Portfolios:
Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>
Zacks Investment Research