NASDAQ, S&P Jump Over 1% Each to End Their Four-Day Skids
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For the first time in a week, all three major indices moved higher in the same session as tech resumed a leadership position on Tuesday.
There was no fantastic news today that would turn the market around. In fact, the situation was pretty much the same as yesterday, which led to a very rough session that saw the Dow plunge more than 500 points.
The U.K. is still putting on new restrictions due to a spike in coronavirus cases, and we’re still nowhere near a fresh coronavirus package to replace the aid that expired weeks ago.
However, perhaps four days of losses was just too much for this market even in the midst of a September slump.
The NASDAQ jumped 1.71% (or nearly 185 points) to 10,963.64. That puts an end to its four-day losing streak, which also included three days of drops over 1%.
All of the FAANGs were higher with Amazon (AMZN, +5.69%) leading the way followed by Facebook (FB, +2.66%) and Alphabet (GOOG, +2.4%).
The S&P also snapped a four-session slide by rising 1.05% to 3315.57. The Dow rose 0.52% (or about 140 points) to 27,288.18, which is barely even a dent in Monday’s 1.8% plunge but does break its own three-day losing skid.
This was the first time since Tuesday, September 15 that all of these indices were higher at the same time.
Fed Chair Jerome Powell was making comments again today. He was testifying in front of the House Financial Services Committee.
There was nothing groundbreaking in his comments, though he reiterated that the Fed will do all it can to support the economy and that we need more pandemic relief.
Treasury Secretary Steven Mnuchin was also testifying and agreed that a deal was needed. Both of these guys will be speaking again later this week on the Senate side.
Today's Portfolio Highlights:
Stocks Under $10: It was time to clean out some of the bigger underperformers in the portfolio, so Brian sold Lincoln Educational (LINC), Solaris Oilfield (SOI) and Casper Sleep (CSPR) on Tuesday. The editor immediately filled one of those holes by adding Harmonic (HLIT), a communications name with its own operating system for cable boxes. HLIT has beaten the Zacks Consensus Estimate in three of the past four quarters, with the most recent report also including a raised guidance for the full year. Earnings estimates for this year and next are moving in the right direction, which explains why HLIT is a Zacks Rank #2 (Buy). It should become profitable next year. Some of the older subscribers may remember that HLIT was in the portfolio last year and brought a gain of more than 13%. Brian is hoping for more this time around. Read the full write-up for a lot more on all of today’s moves.
Surprise Trader: There’s only going to be one buy for the portfolio this week because Dave is going on vacation. So it’s kind of fitting that today’s addition is Thor Industries (THO), a mobile home and RV company that helps people take vacations while keeping a social distance. Not only is this stock a Zacks Rank #2 (Buy), but it’s also part of a space in the top 14% of the Zacks Industry Rank. THO has a positive Earnings ESP of 4.51% for the quarter being reported before the bell on Monday, September 28. The editor added THO on Tuesday with a 12.5% allocation, and also sold the underperforming Brady Corp. (BRC) position. Read the complete commentary for more.
Zacks Short List: The portfolio swapped out two positions in this week's adjustment. It short-covered PVH Corp. (PVH, +8.5%) and ServiceNow (NOW), and then replaced them by adding The Trade Desk (TTD) and XPO Logistics (XPO). Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short List Trader Guide.
Have a Great Evening!
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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.