Market Overview

Stocks Feeling A Bit Under The Weather

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We haven't seen this in a while. For the first time in over a month, the S&P and Dow just completed back-to-back losing sessions. The declines weren't severe, but the major indices failed to mount an end-of-the-day rally into the positive that we've grown accustomed to. The S&P finished lower by 0.29% to 2368.4, while the Dow was off 0.14% to 20,924.8. The NASDAQ declined 0.26% to 5833.9.

The big issue on Tuesday was healthcare, as the Republicans outlined their plan to replace Obamacare while President Trump again tweeted on the need to reduce drug costs. Overshadowing everything is the Government Situation Report on Friday and the likelihood of a rate hike coming from next week's Fed meeting. So stocks are feeling a bit under the weather, which explains why they aren't particularly buoyant right now.

In the portfolios, Game Changers sold its final three positions as it rides off into the sunset, and one of them was a big double digit winner. Stocks Under $10 also had a big return from a company that's been flirting with a new high. Finally, Reitmeister Trading Alert added to three existing positions, while Black Box Trader swapped out two names in its weekly realignment. See below for more...

Today's Portfolio Highlights:
Game Changers: That's it! The portfolio will be retired on Friday, and today Brian sold the final four positions. Three of them were positive with the big winner being the more than 27% return for Bank of America (NYSE: BAC). The other profits came from OSI Systems (OSIS, +8.7%) and Orbital ATK (OA, +3.5%). The editor believes that all of the stocks sold today have excellent long-term merits. Read the complete commentary for more.

Stocks Under $10: The other day, Intevac (NASDAQ: IVAC) came pretty close to testing its highs. Brian saw an opportunity to get out of this recently-volatile name at a great price. He sold this supplier of hard disk drive space today for a return of nearly 21%. "(NYSE: I)f it keeps moving higher we can cheer for those that decided to hold on. If it moves back lower, we will be kicking ourselves if we didn't make this move," said the editor. He also sold two other names today. See the full write-up for more.

Reitmeister Trading Alert: Sometimes you have to make calculated risks with speculative stocks, which is why Steve added more Groupon (NASDAQ: GRPN) on Tuesday. The editor thinks it's worth the risk to buy more shares of this stock at around $4, since he believes it could be as high as $6-$7 by year's end. The portfolio also bought more of RV manufacturer Thor Industries (NYSE: THO), which got walloped today by high frequency traders. But Steve sees its high CapEx spending as a big positive for the future, and believes this $104 stock (after today's selloff) could be worth $140 to $150 by year's end. Finally, Steve also added more Royal Caribbean (NYSE: RCL) because he had the cash. Learn more about all these moves in the complete commentary.

Zacks Short List: Both stocks that were short covered in this week's adjustment were positive: AMC Entertainment (AMC, +5.3%) and Level 3 Communications (LVLT, +4%). The new additions that replaced these names are GoDaddy (NYSE: GDDY) and 58.com (NASDAQ: WUBA). Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short List Trader Guide.

Zacks Counterstrike: "Ever since we hit 2400 in the S&P there has been a mild weakness in equities. I mentioned in previous commentary that we are seeing overnight selling that leads to afternoon buying. Well today that didn't work for the first time in a while and markets puked into the close. This led to a slight down day.

"What caught my eye today was the VIX. We all know it's very low, but today it ripped into the close to finish up 1.87%. The Vix futures were still red, but this is only because the contract expires in 14 days and there isn't any "real" fear out there. However, if the market continues lower, we could start getting a sense that the market has topped. Investors might not be willing to buy until some of Trump's polices actually get put in place." -- Jeremy Mullin

All the Best,

Jim Giaquinto

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