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Rebound Lifts NASDAQ to New All-Time High


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The major indices are all set up for a strong week following today's rebound. The Dow and NASDAQ each enter Friday's session with advances of nearly 2% over the past four days, while the S&P is up about 1.4% in that time.

"The market is starting to get hot again. It's nice to see that the bulls are still wanting to buy despite the tariff headline," said Jeremy in Counterstrike . "Market participants are obviously anticipating some good trade news eventually. If we get it I expect new all-time highs before the year is out."

The NASDAQ surged 1.39% (or 107 points) to a new record of 7823.9 , thanks to strong performances from usual suspects like Alphabet (+2.56%), Amazon (+2.37%), Microsoft (+2.17%) and Facebook (+2.16%).

The Dow climbed 0.91% to 24925.2, while the S&P is now standing outside the door of 2800 after rising 0.87% to 2798.3.

Yesterday, stocks dropped on news that President Trump is planning 10% tariffs on $200 billion worth of Chinese goods. However, China did not immediately retaliate and the tariffs are not scheduled to go into effect until next month. In addition, the market is gearing up for quarterly reports from a few of the big banks tomorrow, including JPMorgan, Citigroup and Wells Fargo. In other words…earnings season has begun!

According to Sheraz Mian's Start of Q2 Earnings Season piece, total earnings for the S&P are expected to jump more than 19% from last year on 8.2% higher revenues. This would mark the third quarter in a row of double-digit earnings growth for the index, which should continue in the second half as well.

In the portfolios, Healthcare Innovators cashed in a double-digit winner that's been in the service since the beginning, while Technology Innovators picked up a chip company that held its own during the market's recent challenges. Dave bought in Surprise Trader for the fourth straight day and also entered the oil patch in Momentum Trader . Learn more below:

Today's Portfolio Highlights:

Healthcare Innovators: Edwards Lifesciences (EW) was one of the initial picks of this portfolio when it started a little over a year ago. Since then, this fighter of late-stage cardiovascular disease has performed so well that Kevin says the risk/reward from here faces an uphill battle. We're about two weeks away from its next report, and the editor decided to bank the 48.1% return since it would take a really strong performance to push it higher from here. He also sold Novartis (NVS) for a 1.7% gain today.

Surprise Trader: Dave is not a very big fan of bank stocks for this portfolio. However, he made an exception with the bank holding company Veritex (VBTX), which is expected to generate revenue growth of 109.3% this quarter and EPS growth of 91.3%. These lofty expectations, along with a positive Earnings ESP, has the editor feeling pretty good about its report on Monday, July 23rd. He deposited VBTX into the portfolio on Thursday with a 12.5% allocation. Read the full write-up for more.

Technology Innovators: Even when the market was really selling off, shares of Diodes (DIOD) managed to weather the storm unlike many other chip names. Brian Bolan was looking for that type of resiliency for the portfolio, so he added this Zacks Rank #1 (Strong Buy) manufacturer of discrete & analog semiconductor products on Thursday. Over the past four quarters, the stock has beaten three times and matched once. DIOD doesn't report again for about a month, and the editor plans to hold it through the announcement. Learn more about this new addition in the full write-up.

Momentum Trader: The oil & gas E&P space may be in the top 18% of the Zacks Industry Rank, but Dave has been a bit hesitant to get into the oil patch. However, Comstock Resources (CRK) proved to be too tempting after the energy company pushed back through previous highs after retreating to support. The editor is also impressed with earnings growth expectations of 112% for this year and another 158% for next. The Zacks Consensus Estimate for next year is at $1.24 and the stock traded over $140 in 2014, so it has a lot of ground to make up from here. Learn more about this new pick in the complete commentary.

Insider Trader: "Technology regained its crown today as the bulls showed up in droves, pushing the NASDAQ to new record highs.

"Today's rally was the result of relief that the US and China were apparently back in talks over the tariffs. Many are hoping that there will be an agreement before the extra $200 billion is expected to take effect in 2 months.

"Additionally, many of the big tech names will be reporting earnings over the next 3 weeks. It's going to be good. The stock market is forward looking and they're starting to price in what will be another amazing earnings season.

"This week is turning out to be the best week for the big cap stocks in the last month. I'm expecting it to close out the week with another strong session."
-- Tracey Ryniec

All the Best,
Jim Giaquinto

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , Stocks
Referenced Symbols: VBTX , EW , NVS , CRK , DIOD



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