I’ve just spent two glorious days cleaning out my flower beds and planting my annuals. Cleaning up my yard reminds me that it would also be a good time to review your portfolio—get rid of the non-performers and make room for some more profitable investments.
The volatility in the market has abated—for now—with the Dow Jones Industrial Average gaining about 600 points since the last issue. And as you’ll see in Market Views and our Advisor Investment Barometer, the investment pros continue to be bullish. The economy continues to be strong, with decent housing and manufacturing numbers, as well as low unemployment.
Wall Street’s Best Investments 816
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Market Views
Bullish, but Cautious
No basic changes for our overall views of a market capable of extending; but just in a guarded way. It measures higher, as its mostly fully-valued for big-cap leaders; hence vulnerable to shakeouts.
Equity markets, the Fed’s calmer monetary policy, generally adhere to outlined expectations. Wild cards (like China and domestic politics) remain inconclusive (generally favorable as we see it). Although, we’ll see if judgements on the Mueller Report were premature or not as it’s released in an abridged version. Discretion is the better part of valor in early April, following forecast solid ‘nudging’ over S&P 2800 (but still short of 2850); with tempering zeal pending a ‘China Trade Deal’ and now a faltering on Brexit (again); despite a two-week extension deal for a EU-UK Brexit decision, which ‘in theory’ prevails until April 12.
Gene Inger, The Inger Letter, www.ingerletter.com, April 8, 2019
Looking for New Highs
With investors still favoring a safety over growth, the stock market isn’t in need of another “shakeout” anytime soon since there is not a surfeit of bulls. If anything, the evidence suggests that caution still abounds, and this paves the way for a broad market rally if there are any upside surprises in the upcoming earnings season. With incremental demand for equities having established powerful upside momentum, the path of least resistance for stocks is up and investors’ expectations are very low.
Therefore it won’t take much in the way of good news to stimulate a rally to new highs in the major indices this month.
Cliff Droke, Momentum Strategies Report, www.cliffdroke.com, 707-282-5594, April 8, 2019
Still a Buy
Large Caps remain ahead of small-caps. Growth remains ahead of value among both large and small-cap ETFs.
Our intermediate-term U.S. equity model is on a “buy” as of January 22 suggesting that risk over the next several months should be well contained.
The yield on 10-year Treasury notes is 2.52 trending higher after reaching 2.34% on 3/27, its lowest since 2017. Our investment-grade bond model remains on its January 2 buy signal. Since that buy signal, the total return of the Vanguard Total Bond Market Index Fund (VBMFX) is up +2.3%.
Dr. Marvin Appel and Gerald Appel, Systems and Forecasts, www.systemsandforecasts.com, 800-829-6229, April 8, 2019
To read the rest of this month’s issue, download the PDF.
THE NEXT Wall Street’s Best Investments will be published May 15, 2019
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