The day after Christmas is a great day to take it easy and do as little as possible…which is exactly what a lot of people in the market did on Tuesday. The major indices chopped around the breakeven mark for most of the session and finished slightly on negative ground. The S&P was down 0.11% to 2680.5, while the Dow slipped only 0.03% to 24,746.2 and the NASDAQ declined 0.34% to 6936.3.
Things would have looked a lot better if Apple (NASDAQ:AAPL) hadn’t slipped by more than 2.5% on fears of weak iPhone sales. Unfortunately, such news apparently upstaged very strong retail sales for the holiday season. In fact, it was the best holiday shopping season in 6 years.
“So did you see lines at the Apple store leading up to Xmas? I did. Did you see people buying iPhone 7, 8 or X? I did. This is an overblown worry and I would not be surprised to see the best quarter ever from the big red fruit,” said Brian Bolan in Technology Innovators, who believes anyone that sold AAPL today will regret it down the road.
In the portfolios, both of our computer-model services that are updated weekly were in action. Black Box Trader replaced two names and cashed in a double-digit performance. Short List swapped out one. Also, Tracey is writing all about small caps in this week’s Zacks Confidential. Learn more in the highlights section below...
Today's Portfolio Highlights:
Black Box Trader: The portfolio got out of Dana Inc. (DAN) this week and secured a 10.2% return in a little over 2 months. It also sold Dollar Tree (NASDAQ:DLTR, +0.7%). The two new additions that replaced these names were KBR Inc. (KBR) and NCI Building Systems (NCS). Read the Black Box Trader’s Guide to learn more about this computer-driven service designed to take the emotion out of investing.
Zacks Short List: Only one swap in this week’s adjustment. Molina Healthcare (MOH, +1.4%) has been short-covered and is gone from the portfolio. It was replaced by the addition of Williams Companies (NYSE:WMB). Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short List Trader Guide.
Zacks Confidential: This year didn’t turn out to be the small-cap bonanza that was originally expected. But 2018 could be a different story. Increased earnings and the tax cuts could provide the fuel for a strong performance. Tracey Ryniec always has one eye on the small-caps, which is why Kevin knew she’d be the best person to provide a Zacks Confidential on this asset class. Read her detailed article and get three small-caps to consider in the New Year by clicking here.
Stocks Under $10: "I am seeing a lot of people talk about why they are worried about the stock market for 2018. I have to tell you that I see the first month of the year as the most important. This is the time when bonus money comes flowing into the market and IRA's and 401K's get that annual boost of cash.
"Factor in the adjustment that earnings estimates will see from the new tax plan and you have a big boost coming our way. Other editors here are tracking the inevitable, which is the boost to earnings estimates that is coming via a reduced tax rate.
"Even in all other things are held constant, the lower tax rate will result in higher earnings. Those higher earnings will drive multiples lower and lower... and that could make investor dive head first into some of the stronger names.
"The long term idea there is that this move will help all stocks. That means big caps and small caps. That means high priced stocks and low priced stocks." -- Brian Bolan, who had one of the top performers of the day with a nearly 11.3% advance for Forterra (FRTA).
Have a Good Evening,
Jim Giaquinto
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