When the markets were enduring a steep sell off during the first two months of the year, investors questioned whether or not stocks could build on 2013's gains. As it turns out, the markets rebounded in February and went on a multi-month bullish run.
The S&P 500 and the Dow Jones have both set all-time highs recently, but have come down over the last week, possibly signaling the beginning of a a bigger market pull back. Recent economic news has been a little mixed, raising the question of whether or not the recent weakness is just a bump in the road, or if the market is finally running out of steam.
First the bad news… the most recent employment report indicated that unemployment rose from 6.1% in June to 6.2% in July. While the unemployment level is still well below its recession-era levels, any jump in unemployment is going to give the market a good scare.
The good news is that the preliminary reading of second quarter GDP showed that the economy grew at 4.0% during the quarter. Keep in mind that this figure will be adjusted multiple times, but it does paint a nice picture for the overall health of the economy.
Ironically, investors receive even good news cautiously these days. With the markets recently hitting all-time highs and the economic picture showing improvement, concern has grown that the Federal Reserve is going to start raising interest rates sooner than expected.
With the recent pull backs, the Dow Jones is currently sitting around break-even on the year, the S&P 500 is up 4.8% in 2014, while the NASDAQ has a 5.0% year-to-date gain.
In my opinion, there is still upside in the market, and these are my top five picks for the remainder of the year.
This article was originally published on MarketIntelligeneCenter.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.