Programming Note: The 10-Year Yield surged today and John Blank was on CNBC's Closing Bell this afternoon to talk about it. Click here to watch his appearance.
This is the type of week that gets earnings estimate nerds (like us here at Zacks) all excited about the season. Over the next few days, three of the FANG stocks are scheduled to report their results, which will be a significant factor in determining if this earnings season can live up to lofty expectations.
We enjoyed a good start after the bell on Monday when Google parent Alphabet soared past earnings expectations and beat on revenue. Two of the FANG stocks have now reported, and this one was much better received than Netflix's disappointing performance last week. As of this writing, shares of Alphabet are up about 3% after hours.
But that was after the close. The session itself was mixed, though tech had a good showing while waiting for the main event. As a result, NASDAQ advanced 0.28% to 7841.9, while S&P continues to linger above 2800 after a gain of 0.18% to 2807. The Dow however slipped 0.06% to 25,044.3.
Now we wait for Facebook's report on Wednesday and Amazon's on Thursday to complete the FANG names. Both come after the bell because what fun would it be without some suspense? This week will also see dozens of other reports and a GDP reading on Friday (approximately 4% is expected) that could potentially steal the show. "I think Friday's GDP print is the most anticipated event of this young earnings season. It's going to trump earnings, trade wars and yield curves,"
said Dave Bartosiak, editor of Surprise Trader
, Momentum Trader
and Blockchain Innovators
. "Analysts are expecting to see 4.3% for Q2 GDP. Let's hope that the high bar doesn't lead to disappointment at the end of the week,"
In non-earnings news, yields on the 10-year Treasury Note jumped on Monday to just under 3% at 2.965%. Unlike in the past, the market really took it in stride without a serious selloff. Of course, if it continues to rise, then that would be a different story.
The portfolios had a busy day with five of the services making buys, including eight swaps in Black Box Trader alone. Let's get right to it:
Today's Portfolio Highlights:
Surprise Trader: This could be one of the more consequential weeks this earnings season…so there's no way that Dave was just going to sit on his hands and wait to see what happens. On Monday, he started another week of buys with the addition of IMAX Corp. (IMAX), which has a positive Earnings ESP for the quarter coming this Wednesday after the bell. This entertainment technology company is part of a space (Film & Television Production & Distribution) in the Top 10% of the Zacks Industry Rank and is coming off a big surprise in the previous quarter. The editor sold Hersha Hospitality (HT) to make room for IMAX with a 12.5% allocation, marking the portfolio's 11th straight day with a buy. Read more in the full write-up.
Stocks Under $10: Most solar stocks have been getting beaten up due to all this trade turmoil with China…except for Vivint Solar (VSLR). This name has been relatively unscathed from all the craziness and now Brian Bolan thinks it is a great long-term opportunity. The stock has an impressive Earnings ESP of 88% for the quarter coming early next month, while earnings estimates for this year and next have seen huge positive shifts. For example, expectations for 2018 have surged to a gain of 59 cents from a loss of 11 cents over three months. Read the complete commentary for a lot more on this new buy and be ready for another addition tomorrow as the editor looks to "widen the net" by increasing the number of holdings.
Counterstrike: Just because you're bullish doesn't mean you can't add some protection. Jeremy has been feeling pretty good about the market over the past few weeks, but earnings season is still an unpredictable time especially during low volume. In addition, the market is looking for catalysts in either direction. Therefore, the editor took out a little insurance policy by adding iPath S&P 500 VIX ST Futures ETN (VXX) with a 4% allocation ahead of this busy week of earnings. He would be happy to sell it at a slight loss later this week. Read more in the full write-up.
Healthcare Innovators: Those afflicted with hemophilia B are watching uniQure (QURE), a Netherlands-based emerging biotech that's become a big name in fighting the bleeding disorder. Their AMT-061 gene therapy product is enrolling patients in the Phase III HOPE-B study, and analysts are expecting some top-line data by the end of the year. Because of the company's R&D lead over the competition, Kevin thinks this could be a blockbuster in the making, so he added it to the portfolio on Monday. In other news, the editor has concerns about the valuation of CRISPR Therapeutics (CRSP), which seems to have a balance of positive and negative catalysts. He decided to cash in the name today for a 9.2% return as it sits on the precipice of a 25% move in either direction. Read more about these moves in the full write-up.
Black Box Trader: It's practically a brand new portfolio this week as 8 of the 10 positions were changed. The stocks sold from the service include:
• Turtle Beach (HEAR, +17.9)
• HollyFrontier (HFC, +2.9%)
• Devon Energy (DVN, +1.7%)
• Cheniere Energy (LNG, +1.7%)
• ONEOK Inc. (OKE)
• Avnet Inc. (AVT)
• CVS Health (CVS)
• TEGNA Inc. (TGNA)
The new buys that replaced these names are:
• Arch Capital (ACGL)
• Antero Resource (AR)
• Centerpoint Energy (CNP)
• California Resources Corp (CRC)
• Terex Corp (TEX)
• Textron (TXT)
• Tractor Supply (TSCO)
• United States Steel (X)
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: Online sales continue to soar in this strong economy…and it isn't all Amazon (though it's a pretty big part of it). There are several ways that you can profit from this changing retail landscape. In this week's Zacks Confidential , Kevin asked Neena Mishra to explain how ETFs can help you hop on this profitable bandwagon. So instead of looking for the "next" Amazon, learn how an ETF can help you take advantage of the whole industry. Read her article and get a couple recommendations by clicking: Here's Why You Should Invest in Online Retail ETFs.
All the Best,
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