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The NASDAQ managed to inch forward on Tuesday to snap a three-day losing streak. But, otherwise, stocks remained erratic and mostly lower as the market continues to grapple with rising rates.
Tech has been under pressure for a while now, but they had a good enough showing today for the NASDAQ to advance 0.03% to 7738.02. The index spent most of the session in positive territory, though it did close off its highs. Other than Alphabet, the FANGs were all positive on Tuesday, led by green performances from Netflix (+1.89%) and Apple (+1.39%).
The market looked like it might be able to close with modest gains all around, but the choppiness from earlier in the session never abated. In the end, the Dow slipped by 0.21% to 26,430.57 as it again swung by a couple hundred points throughout the day. The index managed a positive close just yesterday to break several days in the red. Meanwhile, the S&P now has a four-session losing streak after dipping by 0.14% to 2880.34.
Everyone is watching the 10-year note right now, and they saw it rise early to a seven-year high before eventually pulling back by the close. While rates are getting most of the press for this recent sluggishness, you can bet there's also a good amount of profit-taking in front of earnings season and the upcoming mid-term elections.
Speaking of earnings season, it can't come soon enough! We love earnings here at Zacks since they form the basis of the Zacks Rank. But in addition to that, a new string of positive reports would probably help this market find a new upward direction to finish 2018 on a strong note. It all starts on Friday with reports from a few of the big banks and then it'll really reach a new gear in the following weeks. We can't wait!
Today's Portfolio Highlights:
Surprise Trader: Get ready for a lot more action in this portfolio as the next earnings season unofficially starts on Friday with some of the big banks. Dave is kicking things off by adding railroad company CSX Corp. (CSX), which is a Zacks Rank #1 (Strong Buy) and part of a space (transportation - rail) in the top 13% of the Zacks Industry Rank. It has a positive Earnings ESP of 1.9% for the quarter coming on Tuesday, October 16. CSX was added with a 12.5% allocation. Read the complete commentary for more and be prepared for "several" more moves this week.
Zacks Short List: The portfolio swapped two names this week. Firstly, it short-covered Huazhu Group Ltd. (HTHT) and Guidewire Software (GWRE) for gains of 9.2% and 9.1%, respectively. The new buys that replaced these names are BioMarin Pharmaceutical (BMRN) and Qualcomm Inc. (QCOM). Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short List Trader Guide.
Counterstrike: "I am not feeling this market at the moment. I don't want to be exposed on the long side too much, but I don't want to get short and get my faced ripped off on good trade deal news. Not having a good feel creates a problem for traders that makes them hesitate and miss opportunities.
"Knowing that basic fact is important, but also knowing that cash is a position can bring calm to a trader that fears he might miss the next move. Beyond the psychology of it, the market is telling me one thing: Be patient.
"Patience is importance at the moment as there is no clear trend ahead of earnings. With the financials reporting on Friday, we will jump into earnings season. And in the following weeks, we will see earnings come and go quickly. Over the next month, the market will start to adjust to EPS reports and we should form a trend. If earnings are still strong, we should see new highs into the year. If we see a slowdown, then we can expect a larger pull back." -- Jeremy Mullin
All the Best,
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