Technology

Tech Driven NASDAQ Soars Again

Zacks Ultimate,

This is Brian Bolan filing in for the Ultimate Editor Jim Giaquinto.  Jim has some incredible foresight … not into the markets per say, but just for taking the day off when the market moves in a big way.  I think I will have to start informing my readers ahead of time when Jim is taking off… the move would be to put on a straddle options trade as we don’t know which way it will go, but it will go one way in a big way!

The way the market went today was up.  Up, up and away for the NASDAQ as that index posted a gain 2.5% on the day.  The Dow fought back from being in the red most of the day and closed with a small gain of about 9 points thanks to a flurry of selling near the close.  The S&P 500  was up 0.84% and saw some selling at the close, but nothing like what was seen in the Dow Jones.

I wanted to make an addition in Tech Innovators today, but I was waiting for a pull back that never came.

A former boss used to say if you are waiting for a pull back you are timing the market… or at least trying to and that is just what I feel like today.  I tried to time an entry when I just should have pulled the trigger. 

The NASDAQ was up almost 100 points and wanted it to be up only 85 points.  Then is was up 130 points and I begged for a 30 retreat to allow me to enter.  Then it was up 165 points and I figured the ship had sailed and it might even be a good short entry.  Then we got to +200 and later +250.

There is a significant tailwind for tech stocks.  The combination of unprecedented stimulus and a favorable market environment has made valuations start to inflate.  Not balloon, just inflate.  Staples are not the fad, nor are financials.  Its tech, tech and more tech.

Broader Market

There was plenty of talk on Twitter over the weekend about vaccine announcements.  From what I saw, you would have thought that we would get 3 or ever 4 announcements so I dragged my feet a little on my morning dog walk so I could be in front of the computer for the news.  There really wasn’t anything to write home about, so Buckeye and I had a little warmer than expected walk.

That said, there have been surges in several states… but we continue to find out that there are lots of bad numbers in the system.  An Ohio man was tested 15 times, while in the hospital with COVID, and you guessed it, each time he still had it… but each time was counted as a new instance of COVID.  This could be a one off problem, but there are also tons of issues in FL as well.  The numbers we should be watching are the ICU bed rates --- how many beds are available.  The deaths are falling as some new treatments are being tested, and that is great news… but it is even better when people stop getting sick from COIVD at all.

I saw on TV that the S&P was positive for the year… and that has to really burn the shorts.  A year that saw an economic shutdown and a market crash has stocks basically flat on the year.  That is amazing.  But what is the lesson?  You cannot fight the Fed… they are pouring money into the system and some of it is landing in the lap of fund managers and they are not keeping it as cash.  That is why I want to be fully invested.

Advancers beat out decliners today, but only by a small measure as the tech names really skewed todays action.  Take them out of the equation and the market finishes lower.  New highs blistered to 400+ which is almost what I would consider a frothy number… but recall all the pessimism out there and how the market loves to humble the naysayers. 

Portfolio Moves

Jeremy Mullin is not only the head of Counter Strike but he also heads up Commodity Innovators as well. Today I see he sold VanEck Gold Miners (GDX) for a 32% gain.  He also moved to add Cleveland Cliffs (CLF) to the portfolio today. Mr. Mullin is bullish on iron ore and steel prices as he looks to a resurgence in global demand to keep those prices rising.  His gold play was a longer term hold, but he still has some other exposure to the space should the miners continue to roll higher.

BlackBox Trader made a slew of moves today as it normally does on Monday. This service sold five previous positions: DR Horton Inc (DHI), Sally Beauty Holdings (SBH), PulteGroup (PHM), Deutsche Bank (DB) and Cheniere Energy (LNG).

The algo selected 5 new names that were added today: Hansebrands Inc (HBI), Caesars Entertainment (CZR), Office Depot (ODP), Berry Global Corp (BERY) and Robert Half Intl (RHI).

This wouldn’t be a complete write up without a little self promotion.  My mother used to say “self praise stinks” – actually, she still says this and hates when I toot my own horn.  I am more in the camp of “self praise pays” because who else in this world thinks I am as great as I think I am?  I say that with my tongue firmly implanted in my cheek.

That said, Tech Innovators is crushing is, with TSLA leading the way up 291% since mid March.  I have no plans to sell this stock and I see it speeding north of $2000 in the near future.  TWOU is up 125% over the same time period and those two names sit atop my Innovators Series service. 

Home Run Investor has two names posting gains of 100% or more.  The health of that portfolio is super strong with 13 of the 14 names in the green and lone red number is only -2.8%.

Stocks Under $10 is my other service that has its own pair of 100%+ winners.  Expect some action in that service tomorrow as there are only 13 names out of a maximum of 15 for that service.

Jim will return tomorrow with a more balanced view across all the portfolios… so be sure to sign up for the three that I manage to hear more from me.

See you soon,

Brian



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