Unfortunately, the market had to prove its resiliency once again on Monday, as the major indices started a new quarter with fresh all-time highs despite the horrible tragedy in Las Vegas.
The Dow had the best performance today with a gain of 0.68% to 22,557.6, while the S&P increased 0.39% to 2529.1. The NASDAQ was up 0.32% to 6516.7. All of these results mark new record closes. And let’s not forget that the Russell 2000 continued its ascent with a surge of 1.25% to its own all-time high of 1509.5. The market also had to deal with some turmoil in Europe today, as a resounding “Yes” vote by Catalonia to break away from Spain was met with violence in the streets.
Stocks were buoyed by good data in the session to go along with optimism over tax reform. The ISM Manufacturing Index exceeded expectations with a jump to 60.8% in September. Construction spending was also positive. Remember, the month has turned, so we’ll be getting a lot of economic data this week that culminates with the Employment Situation report on Friday.
Black Box Trader was the only portfolio making moves today, but it made enough for all the services. The 10-stock portfolio replaced 9 names as part of its weekly adjustment, and 8 of them were positive including a double-digit winner. Read about the swaps below along with this week’s Zacks Confidential and some other analysis from the editors:
Today's Portfolio Highlights:
Black Box Trader: It’s practically a brand new portfolio today after swapping 9 of 10 positions. The best part is that 8 of the stocks leaving the service were positive. Here are the positions that were sold:
• Applied Materials (NASDAQ:AMAT, +10.8%)
• Boeing (NYSE:BA, +7.3%)
• Guess Inc. (GES, +6.8%)
• Owens Corning (OC, +5.3%)
• Abercrombie & Fitch (ANF, +1.5%)
• State Street Corp. (NYSE:STT, +1.2%)
• Cummings Inc. (CMI, +0.6%)
• Estee Lauder (EL, +0.3%)
• Accenture (ACN)
The nine new buys that replaced these names are:
• Costco Wholesale (NASDAQ:COST)
• DSW Inc. (DSW)
• Eastman Chemical (EMN)
• CarMax Inc. (NYSE:KMX)
• McCormick & Co. (NYSE:MKC)
• ON Semiconductor (ON)
• PACCAR Inc. (NASDAQ:PCAR)
• Pilgrim's Pride (PPC)
• UnitedHealth Group (NYSE:UNH)
Read the Black Box Trader’s Guide to learn more about this computer-driven service designed to take the emotion out of investing.
Zacks Confidential: We’re FINALLY talking about tax reform…and the market couldn’t be happier. Investors have been waiting for this ever since President Trump was elected nearly a year ago. So which stocks and industries will do the best under the new plan? Jeremy Mullin has some ideas, and Kevin Matras gave him the chance to express them in this week’s Zacks Confidential. Learn how you should be prepared for the negotiations and get three stock recommendations by clicking: Tax Reform Game Plan.
Surprise Trader: "You’d never know that a series of devastating hurricanes hit the U.S. if you just looked at the latest U.S. ISM Manufacturing numbers. These figures came in at an impressive 60.8 which was ahead of the consensus and the best in more than a decade. Many components were also robust, so broad strength was seen in several areas of this closely-watched report.
"Things are looking quite promising, and that is especially the case when you consider the likely impact of hurricanes over the past few months. There remains a lot to like about the production side of the economy, and it looks like weather isn’t going to slow this down either." -- Eric Dutram
Momentum Trader: "After slugging it out in an extended consolidation range from mid-December to about two weeks ago, the Russell is on the move. It just goes to show you that indexes don’t spend much time below their 200-day moving averages unless there is a compelling reason for them to be in contraction. The Russell traded under its 200-day in mid-August for the first time since a two-day dip in June of last year.
"The question now becomes, how far can this run go? To put this in perspective, the swing low prior to Election Day was 1,156 and the Russell go to 1,392 before stopping for air. That’s a 20% move. This current run on the Russell started at 1,350. A 20% move from there would take the Russell to 1,620, over a hundred handles away from today’s closing price. If you mirror the move down from the July highs, then we’ve got a target of 1,550. Either way you slice it, we are in for a treat." -- Dave Bartosiak
All the Best,
Jim Giaquinto
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