President Trump made good on his goal of passing tax cuts by Christmas...without a moment to spare. Today was the last trading session before the holiday, so the signing provided some big news on what was otherwise a low volume day. The market is closed on Monday.
As has been the case most of this week, the market seemed unimpressed by Washington. Passage of the tax bill has been expected for weeks now, so there wasn’t much fuel to spark the major indices higher on Friday. Still, they came well off their lows of the session by the closing bell. The S&P finished just 0.05% lower to 2683.3, while the Dow was off 0.11% to 24,754.1 and the NASDAQ slipped 0.08% to 6960.
But the indices performed well enough to register another positive week. The S&P was up nearly 0.3% and the Dow increased more than 0.4%, marking five straight weeks in the green for the indices. The NASDAQ was up about 0.3% for a second straight week on the plus side. There’s only one more week to go in 2017, and it is usually a pretty solid one for stocks (more on this in the highlights section).
A lot of people have already begun their holiday...but not the editors. On Friday, ETF Investor added a fund that will benefit on a comeback for value stocks in the New Year. Also, Stocks Under $10 picked up a name from an industry that’s enjoying renewed strength in the market. Learn more about these moves in the highlights section, along with other analysis from the portfolios.
Today's Portfolio Highlights:
ETF Investor: Will value stocks make a comeback in 2018? Neena is making a bet that they will. In fact, it’s already started to happen and will likely continue thanks to the newly-signed tax reform. The editor plans to take advantage of this rotation through Vanguard Value ETF (VTV). The fund’s highest allocation is in the financials sector, which will be a big beneficiary of the tax plan, and its top holdings include Microsoft (NASDAQ:MSFT), Berkshire Hathaway (NYSE:BRKa), Johnson & Johnson (NYSE:JNJ), JPMorgan Chase (NYSE:JPM) and Exxon Mobil (NYSE:XOM). VTV is also one of the cheapest value ETFs out there and offers a “juicy” dividend yield of 2.94%. Read the full write-up for more on this new addition.
Stocks Under $10: The metals sector has been enjoying broad strength in the market recently, and Brian Bolan doesn’t believe its run is over. Therefore, in what is likely his last trade of the year, the editor picked up Cleveland Cliffs (CLF) for the portfolio. CLF is an iron ore mining company that has beaten the Zacks Consensus Estimate in three of the last four quarters with an average surprise of about 40%. The editor wouldn’t be surprised if this approximately $7 stock makes it up to $9 in the near term. Learn a lot more about this new pick in the full write-up.
Insider Trader: "Markets remain elevated heading into the end of the year with most investors now focused on 2018.
"The Santa Claus Rally has begun. Yesterday, I mistakenly believed it started next week as usually it's the sessions between Christmas and 2 days into the new year but because Christmas is on a Monday this year, it actually started today, on Dec 22.
"Why do we care about the Santa Claus rally?
"Historically, according to LPL Financial, these 7 trading days have been positive 77.8% of the time with an average gain of 1.35%.
"That's the best 7 session time period of the year." -- Tracey Ryniec
Have a Merry Christmas!
Jim Giaquinto
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