This week was a lot like the overall environment—mixed—with the big-cap indexes and most growth measures up 1%-ish, while the broader market has struggled, down 1% to 2% on the week, give or take.
That mixed feeling is really our main thought right now: If you look at everything from growth measures (like MTUM or IPO) to broad indexes (S&P 400 Midcap, Russell 2000) to even equal-weight big-cap measures (RSP, QQQE), they paint a neutral intermediate-term picture, with most faltering near their spring highs a couple of weeks ago and chopping around since.
While individual stocks haven’t been mostly sideways, the mixed vibe is being felt as performance has been all over the place—some names look great, but many have hit major air pockets and a bunch are stuck in the mud, with selling on strength seen after a good day or two. We would say that fresher names—those that broke out with some power within the past couple of months—have tended to be more resilient, whereas many (not all) names that got going six or nine months ago look more wobbly.
Overall, neutral doesn’t necessarily mean bad—for the here and now, we think many indexes, sectors and stocks are still in a consolidation that began in March/April; with the long-term trend up for most everything, the odds favor the next big move being up.
But for the here and now, most of the action resembles a washing machine, with a lot of stuff getting tossed around; if you own 10 stocks, chances are a couple look great, but most are flopping around and every couple of days one of your names is giving you a headache.
A good (or bad) few days could change things, but right here, we’ll leave our Market Monitor at a level 7. But as we’ve been writing, stock selection and getting decent entry points is key, as is honoring stops and taking partial profits on the way up when offered.
POTENTIAL BUYS
Carpenter Tech (CRS) has finally exhaled somewhat, meeting a little selling on average volume as shares dip a bit below the 25-day line—normal action given the prior move. If you don’t already own some, we’re OK grabbing some shares around here or on further weakness, with a stop near the 50-day line (near 94).
SUGGESTED SELLS
Partial Sells
None this week
Full Sells
Celestica (CLS) – we took partial profits after a quick post-breakout move, and we’ll sell the rest at a small profit here.
Core & Main (CNM) – another stock cracking on earnings.
Garmin (GRMN) – sharp dip two weeks ago but zero bounce since. We’ll get out relatively quickly and swallow the small loss.
Oscar Health (OSCR) – cracking support and its stop today.
Southern Copper (SCCO) – wiped out during the commodity selloff.
Vertiv Holdings (VRT) – tripped stop and sliced its 50-day line on big volume.
SUGGESTED STOPS
ATI Inc. (ATI) near 54.5
CNX Resources (CNX) near 24.5
Coupang (CPNG) near 21.4
Delta Air Lines (DAL) near 48
Dutch Bros. (BROS) near 33.5
GE Verona (GEV) near 152
Glaukos (GKOS) near 104
Howmet Aerospace (HWM) near 74.5
Johnson Controls (JCI) near 66.5
Natera (NTRA) near 94.5
Onto Innovation (ONTO) near 200
Pan American Silver (PAAS) near 19.5
PulteGroup (PHM) near 108 – this and TPH could be sells in the day or two ahead if they don’t rebound after their initial dips today on the post-jobs report spike in interest rates.
Skechers (SKX) near 65.5
Starbulk (SBLK) near 24.5
Sweetgreen (SG) near 27.5
Taiwan Semi (TSM) near 147.5
Tri Pointe Homes (TPH) near 36.9
United Airlines (UAL) near 49.5
Wabtec (WAB) near 158
Wheaton Precious Metals (WPM) near 52.5
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