Three Leading Rebound Stocks

RoboStreet – November 29, 2018

Three Leading Rebound Stocks

Investors got what they were hoping for coming into the final month of 2018 – a statement from Fed Chairman Jerome Powell that shed some positive light on interest rates and, more importantly, future hikes on short-term rates. To use a common phrase, “it’s what the doctor ordered’ because the market was looking sickly for the past two months.

The S&P 500 busted higher and extended weekly gains by 2.3% on Wednesday after Powell said he sees current interest rates “just below” neutral. That proved to be a rally-point because the language Mr. Powell used early last month indicated a view that the fed funds rate was “a long way from neutral.” Meanwhile, the Dow Jones Industrial Average gained 2.5%, the Nasdaq Composite gained 3.0%, and the Russell 2000 gained 2.5%. It was a banner day all around.

Fed Chair Powell added that there is no preset policy path and the Fed will be data-dependent in its decision making, which also pleased investors. By highlighting risks that included previous rate increases, trade disputes, and Brexit/EU political uncertainty, the market chose to read between the lines that the Fed chair isn’t committed to three rate hikes in 2019. Powell’s perceived dovish remarks sent bond yields and the dollar lower. The U.S. Dollar Index dropped 0.6% to 96.84, the 2-yr yield fell three basis points to 2.80%, and the 10-yr yield slipped one basis point to 3.04%.

Regarding trade disputes, investors remain hopeful that some kind of agreement can be struck between the U.S. and China to forestall further protectionist trade measures. There is a widening belief that President Trump might aim to keep a floor of support under the stock market by striking a more conciliatory tone in his Saturday meeting with China President Xi Jinping.

Nevertheless, it remains a speculative deal given President Trump’s tough-minded tariff position and the headline crossing the tape today that tough-talking Director of Trade and Industry Policy and aid Peter Navarro will be attending dinner with President Trump and China’s President Xi. Investors are remiss to think that a deal to completion of any strength will be struck at the G20. I assume that a tone of constructive optimism will be the best outcome.

Back to the stock market, the S&P information technology, consumer discretionary, and health care sectors provided strong support for the broader market. Three stocks leading the rebound are also core holdings of our RoboInvestor Portfolio. They include Amazon.com, Salesforce.com, andVisa, all of which soared in Wednesday’s big rally.

I recommended Amazon.comon November 16 at $1,532 and the stock has soared to $1,670 in just the past four days. This is exactly the reason being a RoboInvestor subscriber is so valuable. When the majority of investors were bailing out of Amaazon.com, I got our RoboInvestors long the stock and it’s now up by almost 10% in a week. For some hedge funds, that would make the year.

And then comes along Salesforce.com,releasing a late Tuesday blowout third-quarter set of results and beating the top and bottom line while providing resoundingly bullish forward guidance, sending shares of CRM vaulting higher by +13 points, or 12% to close at $140.50. Any fears of a slowdown in cloud software were put to rest when CEO Mark Benioff gave a glowing outlook for his company and the industry as a whole.

Thirdly, results from last weekend’s retail sales that included Black Friday through Cyber Monday were record-setting figures, and not just by a little margin. Shares of Visa were sent spiking higher to $141.50. Black Friday pulled in a record $6.22 billion in online sales, as reported by Adobe Analytics. Online sales Black Friday jumped 23.6% from a year ago and Cyber Monday smashed previous records with online sales of $7.9 billion.

When seeking out the best stocks that will lead the market back to new all-time highs, RoboInvestor will get investors in early and on a very timely basis. The S&P rallied 3.8% from the retest low seen last Friday while Amazon.com, Salesforce.com, and Visa gained an average of +9.4%. That is what I call leadership, when three crème de la crème blue-chip stock out-pace the market’s benchmark index by 2.5 times.

And the fun has just begun. My Tradespoon Seasonal Chart is ringing sleigh bells for a year-end rally. All four time periods (20 days, 30 days, 40 days, 50 days) are signaling blended 90.25% probability of a higher market for the next seven weeks. This is just a fantastic set up for investors.

The only serious question investors need to ask is will they be satisfied with whatever the major averages return are or do they want to participate in stocks and ETFs that outperform expectations by 2.5 times. Quite frankly, this is a loaded question and I look forward to working with new subscribers that want to get in on the rest of the best of my market leading stock picks for the balance of 2018 and into 2019.

The cost of subscribing to RoboInvestor is virtually pennies compared to the realized profits we are booking week after week, month after month. Put RoboInvestor in your holiday shopping basket and let’s make some money together – lots of money!