Zacks Investment Ideas Feature Highlights: Martin Marietta Materials, Guggenheim Solar ETF, First Solar And HCA Holdings

Published 09/27/2016, 09:30 PM
Updated 07/09/2023, 06:31 AM
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For Immediate Release

Chicago, IL – September 28, 2016 – Today, Zacks Investment Ideas feature highlights Features: Martin Marietta Materials (NYSE:MLM) (NYSE: MLM -Free Report) , Guggenheim Solar ETF (NYSEARCA: TAN -Free Report ), First Solar (NASDAQ:FSLR) (NASDAQ: FSLR -Free Report) and HCA Holdings (NYSE: HCA -Free Report) .

Trading the Presidential Debate: 3 Stocks to Buy Now

Monday night’s debate was awkwardly entertaining. I must admit I was cringing and laughing as the two candidates went after each other. However, my focus was on the futures markets as I expected the market to move during the debate. While most people around the world watched their TVs, I was watching my trading monitors for an indication on which candidate won.

Going into the debate, it was widely accepted by traders that if Trump continued his momentum after last night, it would be a negative for the markets. It’s not that the markets don’t like Donald Trump, they just don’t like the uncertainty that he brings. Mr. Trump’s push in the polls over the last week was attributed to the recent sell off in the market. A debate win could have put him in the lead and done some serious damage to the markets.

The verdict is in before the polls: Clinton Won

Rather than analyze what the candidates said, let’s take a look at how futures markets reacted as the debate went on. Before the debates, I watched four different futures contracts to give me clues to who was winning: Gold, S&P 500, VIX, and the Mexican Peso. The thought was, if Trump won the debate, markets would go lower and fear would rise (VIX, Gold).

S&P Futures- The main indicator of the markets, the S&P futures, were actually trading down about 0.40% before the debate. However, after an hour into the debate markets turned 0.50% higher as Clinton seemed to be winning.

Gold Futures- Since last Wednesday, gold was up 2%. This was a combination of the Fed holding off on rates and Trumps momentum. I was watching for a spike with a Trump win, but when Trump started to struggle, gold sold off.

VIX Futures – The fear gauge is always a great indicator to look at during big trading events. Before the debate, VIX futures were trading at 16.50, but fell 2% during the debate, to under 16. If the polls stay tight volatility will stay elevated, but if Clinton takes back a big lead, expect the VIX to get smashed.

Mexican Peso- Trump policies would damage the Mexican economy and its currency. As Trump gained momentum, the Peso weakened. Last night, the Peso charged almost 2% higher during the debate, a sign that Clinton had won.

Stocks that will benefit

There wasn’t much substance to what was discussed, which makes it very difficult to determine what actually might get done once in the White House. Since Clinton won the debate, let’s focus on stocks that will benefit if she wins the election. These stocks could take off today and continue to rise over the next month as a Clinton victory becomes more certain.

The three stocks listed below are all Zacks Ranked #3 (Hold). A Clinton victory might force analysts to revise estimates higher so keep an eye on the rank for any improvements.

Infrastructure

Clinton wants to improve the nations crumbling infrastructure, so it’s wise to go with a known name that deals in the construction of highways and infrastructure. Martin Marietta Materials (NYSE: MLM -Free Report) will be an important supplier of the aggregates used to build the roads and bridges that will be included in her budget plan.

Alternative Energy

Clinton’s move off of fossil fuels and into renewable alternative energies makes the solar sector appealing. The Guggenheim Solar ETF (NYSEARCA: TAN -Free Report ) should move higher with a Democrat victory. Clinton’s goal to have renewable electricity in every home within 10 years makes First Solar (NASDAQ: FSLR -Free Report) very attractive at current valuation levels.

Healthcare

Clinton would expand Obamacare if elected, allowing more visits before deductibles and tax credits for out-of-pocket expenses. Hospitals would profit with an expansion of Obamacare as more people would be encouraged to get care when it’s needed. HCA Holdings (NYSE: HCA -Free Report) operates 164 hospitals and 116 freestanding surgery centers that would benefit.

In Summary

By no means is the election over. There are still two more debates and plenty of time until Election Day. Be aware of the market indicators listed above to give insight into which candidate might be improving in the polls. Use these indicators to allocate funds into stocks that will benefit from that candidate winning the White House.

It should be noted that since last night, futures have given back debate gains due to Europe banking fears. While the election is a powerful force in market direction, other issues might temporary stall that direction. The Peso has held on to most of its gains, telling us that other forces then the debate were at work on the selling this morning.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.



MARTIN MRT-MATL (MLM): Free Stock Analysis Report

GUGG-SOLAR (TAN): ETF Research Reports

FIRST SOLAR INC (FSLR): Free Stock Analysis Report

HCA HOLDINGS (HCA): Free Stock Analysis Report

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