Stocks Finish Strong with 1% Rally

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The major indices each advanced well over 1% on Friday, closing out a frustrating week that saw the market mostly ignore solid earnings results.

Apple was a big factor over the past 5 days after it reassured a nervous market on Tuesday with a strong second quarter performance. It reported a positive earnings surprise and sold 52.2 million iPhones. The NASDAQ was the biggest beneficiary and registered the best performances of the day and the week.

The index jumped 1.7% on Friday to 7209.6, thanks in part to a 3.9% gain in Apple after news that Warren Buffett purchased 75 million shares in the first quarter. The rally gave the index a weekly gain of about 1%, making it the only one of the Big 3 on the positive side.

The Dow rose 1.39% today to 24,262.5 and the S&P increased 1.28% to 2663.4. These rallies were almost enough to put the indices on positive ground for the week, but they fell just short with losses of less than 0.1%.

"Let's get one thing straight, I have been bearish. However, the last two days have me changing my tune. The 200-day has held now for the third time and today's move should get the bears to cover their short positions next week," said Jeremy Mullin in Counterstrike .

In addition to Apple, the market got some help from the jobs report as well. The economy added 164,000 new jobs last month, which was below expectations of around 185,000 to 195,000. However, the unemployment rate fell to 3.9% from 4.1% and wage growth was weaker than expected. In other words, the report was better than last month's alarmingly soft result but didn't provide the Fed with reasons to accelerate its rate hike plans.

Today's Portfolio Highlights:

Insider Trader: A funny thing happened in the portfolio today. One director that sits on two boards bought shares in each company on the same day…and they both came up in Tracey's screen. Therefore, the service added Bristol-Myers (BMY) and Raytheon (RTN) on Friday based on two buys from the same director. Tracey notes that this has never happened in her 7 years running the portfolio.

BMY is a mega-cap pharma company that is down 16.5% so far this year. Meanwhile, RTN has pulled back from recent highs but is still up 8.4% year-to-date. The editor added each with an approximately 8% allocation, leaving plenty of cash to add another stock next week. See the full write-up for a lot more on these new additions.

Surprise Trader: Dave is seeing opportunity all over the place in this market, and today he seized it with the addition of InterActive Corp. (IAC). Shares of this Zacks Rank #1 (Strong Buy) media and Internet company plunged after Facebook announced that it was adding dating functionality. Now the stock is oversold heading into its quarterly report on Wednesday. It beat by 27% last time and has a positive Earnings ESP for next week's event. The editor wants to be onboard for a possible rebound. Read about all of today's moves in the full commentary.

TAZR Trader: We've reached the point where the semis will either make a stand or fall, according to Kevin. You can put the editor in the former camp. On Friday, he added another 7% to the portfolio's position in Lam Research (LRCX), which has brought the service several double-digit profits over the past couple of years. Kevin thinks the company is worth at least $225, but it is still trading at under $200. Read the complete commentary for more on this new addition and for his analysis on the whole semi space.

Momentum Trader: It's always a great sign when a stock moves to profitability. So Dave really took notice when earnings estimates for Town Sports (CLUB) soared to a 19-cent gain from a 6-cent loss. The Zacks Rank #2 (Buy) health club company has reached new highs and is still running, making it a perfect pick for this portfolio. The editor added it on Friday with a 12.5% allocation. See the complete commentary for more.

Have a Great Weekend!
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: BMY , RTN , LRCX , IAC , CLUB

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