U.S. stocks sold off on Thursday morning following economic data that led investors to believe that the first interest rate cut will likely be in September. However, stocks recovered some of their losses by market close, while bond yields rose. On the housing front, pending home sales grew 3.4% in March according to the National Association of Realtors, ahead of estimates for sales to remain flat sequentially. The Dow was down 1.0%, the S&P 500 fell 0.5% and the Nasdaq lost 0.6%. Crude oil is trading above $83 per barrel and gold is up $1 to $2343 per ounce.

The Federal Open Market Committee meets today and will release their interest-rate decision on Wednesday. That will be followed by Fed Chairman Powell's press conference, always a "can't miss" event for everyone involved in the financial markets. According to the CME FedWatch Tool, the highest probability (subject to massive change) for the first 25-basis-point fed funds cut is at the June 12 meeting -- but that is not a slam-dunk event. By the last meeting of 2024 on December 18, the most-likely scenario for the fed funds rate currently is sitting at three 25-basis-point cuts.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022. That's a recent rarity, as for the past decade-plus, the performance record has favored growth. But the tide turned in 2022. The rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy and regional banks) that had lagged in recent quarters, and value stocks outpaced growth stocks that year. While growth stocks have retaken the lead since 2023, the Federal Reserve continues to keep interest rates high to fend off inflation. This could possibly cap multiple expansion for growth companies in coming quarters. In any event, the value sector is the place to achieve income.

While the Nasdaq continues to flirt with (finally) printing an all-time high (ATH), the last of which was in November 2021 at 16,057.44, the Nasdaq 100 (QQQ) has been in ATH territory since December 2023. And yes, the ETF has cycled into overbought (OB) territory on a daily and weekly basis and is close to cycling into OB territory on a monthly basis.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022. That's a recent rarity, as for more than a decade, the performance record favored growth. Since 2010, the Russell 1000 Growth Index has climbed more than 575%, compared to an advance of almost 200% for the Russell 1000 Value Index. In 10 of the past 13 years, growth stocks have topped value stocks. That hasn't always been the case. In the 2000-2010 decade, including the Great Recession, value stocks were better performers than growth stocks, advancing an admittedly low 8% (but still better than growth, which declined 15% during the decade). Value investors trace their roots to the famous "Security Analysis" textbook, written by Ben Graham, an economics professor at Columbia University. Warren Buffett was one of his students. Why the recent deviation in performance? Several reasons, including changes in the make-up of the economy, growth in intangible assets, and the current level of interest rates. But the tide turned back in 2022, at least for a while, as the rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy and regional banks) that had lagged in recent years. While growth stocks have recaptured the lead since 2023, the Federal Reserve continues to keep interest rates high to fend off inflation. This could possibly cap multiple expansion for growth companies in coming quarters. In any event, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.0%, compared to the 0.7% current yield on the iShares Russell 1000 Growth Index ETF. For our list this week, we have screened our coverage universe for stocks that are BUY-rated by Argus Research analysts, have an Argus Financial Strength Rating of at least Medium, and have a yield of 3.0% or higher. Here's a baker's dozen that meet the criteria. These stocks are also featured in our High-Yield theme model portfolio.

Last week was one to remember for financial markets. After Tuesday's close, some Technology results disappointed investors, with GOOGL plunging 8% and MSFT off 2.5%. While expectations for a March FOMC rate cut already had mostly disappeared, the market didn't like hearing it from Jerome Powell, which knocked the market even lower. The S&P 500 (SPX) lost 1.6%, the S&P 100 (OEX) gave up 1.8%, the Nasdaq fell 2.2%, and the Nasdaq 100 (QQQ) dropped 2%.

Stocks edged higher on Thursday morning following new economic data. The advance reading of U.S. GDP came in at 3.3%, down from 4.9% in 3Q but well ahead of the expected 2%. GDP was boosted by increases in consumer spending in both goods and services. On the housing front, new home sales for the month of December rose 8% to a seasonally adjusted annual rate of 664,000. The median sales price of new houses sold in December 2023 was $413,200. The average sales price was $487,300. The Dow rose 0.2%, the S&P 500 was up 0.5% and the Nasdaq gained 0.6%. Crude oil traded above $76 per barrel, while gold fell to $2015 per ounce.

Earnings season has arrived, with some of the major financials kicking off what is always a period of anticipation, excitement, and fear (depending on what's in your portfolio). While technicals take a back seat during this period, there is one constant: the reaction to the quarterly reports and company guidance is more important than the actual earnings. In addition, perspective is needed. Did a stock run up or was it hit before the numbers printed? This can make the reactions a little more difficult to read.

The approximately $2.3 trillion cryptocurrency market (Bitcoin, Dogecoin, Ethereum, stablecoins, etc.) has been soaring from the $1.3 trillion level as central banks appear to be winding down rate-hike campaigns and a risk-on mentality returns. Year-to-date, Bitcoin is up more than 150%, though it is still down 35% from all-time highs established in November 2021. In theory, consumers, investors, and traders all have reasons to like Bitcoin. For consumers, cryptocurrency can cut the middleman out of a transaction of value. But we think crypto volatility is too high to consider paying for a tank of gas (or even a Tesla) with Bitcoin. For traders, the ups and downs of the various cryptocurrencies are a major opportunity -- as long as they are on the right side of Elon Musk's tweets, or rapidly changing Chinese crypto rules, or the developing regulatory framework in the U.S. Investors wonder how far crypto is from becoming a mainstream security. We estimate the global equity market capitalization is approximately $110 trillion. Gold is about $12 trillion. For crypto to make it on the radar of most investment managers, we expect it would need to approximately triple in value to $5-$7 trillion. Then it could account for 2%-3% of total portfolio assets and could be used as a growth alternative. By then, there also might be more uses for and regulations to define the asset class (perhaps an ETF based on spot prices early next year), and more fundamentals to support valuation.

Management's ability to "raise guidance" can often be a catalyst for market-beating returns in the quarters ahead. The third-quarter earnings season is wrapping up, with blended earnings (actual results and the consensus for those still to report) showing a 6.3% gain, year-over-year, according to Refinitiv. That is considerably better than the 1.0% expected at the start of the earnings period, and should be enough to end the "earnings recession" that investors have endured over the past three quarters. Propelling the 3Q outperformance were strong gains in Communication Services, up 46%, while Energy again (like last quarter) is performing the worst, down 33%. Our analysts are always on the lookout for companies that boost their outlooks during earnings season. Here is an initial list of BUY-rated companies in Argus Coverage at which management raised guidance or increased its outlook during the 3Q23 EPS reporting season.

In this edition, 3M's moat narrows; cybersecurity firms shine; P&C insurers' outlooks differ; and Hanesbrands, Grab Holdings, and Evergy.

Economic trends in China bear watching. China is now an $18 trillion economy and represents about 18% of the global economy. Thus, China is a critical contributor to overall global economic growth, even if it "only" grows 3%-5%. In fact, 4% growth in the Chinese economy today adds more to global output than the 10% growth achieved 10 years ago, when China was growing faster but was smaller. China also poses risks to the global economy, particularly through its relationship to Taiwan. We see a low likelihood of a Chinese invasion of Taiwan. First of all, the Russian invasion of Ukraine has hammered home the challenges of invading a sovereign land in the age of modern weapons, which mitigate soldier-number advantages. Second, Taiwan, unlike Ukraine, is not land-adjacent, but across a vast body of water -- further lessening the chances of success. Third, Ukraine is not a NATO member and the U.S. does not have defense treaties with Ukraine. The U.S. does have a defense treaty with Taiwan, which China will not take lightly. Fourth, if China invades Taiwan, it risks becoming a pariah nation -- and China is an export economy, so any invasion would facture its relationships in key markets. Eager nations like Vietnam, Malaysia, Philippines and Indonesia would be happy to pick up the slack in global trade, and China knows this. Finally, China has not bounced back from COVID lockdowns. Given deep pressures in the real estate and banking sector, heightened global competition from the nations mentioned above, the rise of India, a demographic crisis (not enough young people), and other factors, China could slip to slow growth or possibly recession in coming years. Adding the strain of a major war that might prove unwinnable adds to those risks.

Stocks fell on Thursday, extending Wednesday's selloff, as investors weighed a wide range of earnings reports, a tentative labor agreement between Ford and the UAW, and stronger-than-expected GDP data. Shares of Meta fell 3.7%, along with Apple (down 2.5%) and Microsoft (down 3.8%). The 10-year yield pulled back to 4.84%. The Dow fell 0.8%, the S&P 0.7%, and the Nasdaq 1.8%. Crude oil fell settled at $83.63 per barrel, while gold closed near $1993 per ounce.

The growth prospects for the artificial intelligence (AI) universe are impressive, yet hard to determine. Argus has derived a model of the size and scope of the global AI industry, based on our coverage of the major publicly-traded players and most of the mid-tier players, along with our industry analysts' knowledge of private players. We estimate the global AI industry amounted to about $90-$100 billion in 2021, and expect it to grow at a 40% CAGR through 2030, when it is expected to reach $1.8 trillion in annual revenue. We expect annual growth to decelerate from the low- to mid-40% range in immediate years to the mid-30% range for years toward the end of the survey period. But determining a realistic estimate for the size of the industry is a challenge. Even for an industry that promises to redefine measuring tools, there is no measurable unit of AI output comparable to barrels of oil or tons of steel. As well, much of AI development occurs within labs and at universities, and the output is measured in tangible progress against objectives, not dollars or units of output. In the corporate world, nearly all the AI pure-play companies service micro-niches, have little measurable revenue, and are deeply unprofitable. For our list this week, we take a big picture view of three areas where AI applications are developing. In Big Tech, we believe much of the revenue and most of the profitability from AI is attributable to several giant U.S. and a few international companies that operate primarily in growth sectors such as Technology, Communication Services, and Consumer Discretionary. Next, we note that China is also a hub of AI development, with companies like Alibaba, Baidu, and Tencent (though Argus follows only Alibaba). Finally, Niche Tech has significant AI activity among companies pursuing advances in IoT, vehicle electrification, autonomous driving, automation and connectivity solutions for manufacturing, warehousing, construction, and other areas. Here are featured companies followed by Argus in those three categories.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. Since 2010, the Russell 1000 Growth Index has climbed more than 550%, compared to an advance of almost 300% for the Russell 1000 Value Index. In eight of the past 10 years, growth stocks have topped value stocks. That hasn't always been the case. In the 2000-2010 decade, which included two Bear Markets and the Great Recession, value stocks were better performers than growth stocks, advancing an admittedly low 8% -- but still better than growth, which declined 15% during the decade. Value investors trace their roots to the famous "Security Analysis" textbook, written in 1934 (the year Argus Research was founded) by Ben Graham, an economics professor at Columbia University. Warren Buffett was one of his students. Looking ahead, the rollout of COVID-19 vaccines has given a lift to some of the cyclical companies (Energy sector companies in particular) that have lagged in recent years, and value stocks outpaced growth stocks in the past year. Now, the Federal Reserve is lifting interest rates to fend off inflation, which likely will cap multiple expansion for growth companies. In any event, value is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.0%, compared to the 0.7% current yield on the iShares Russell 1000 Growth Index ETF. For our list this week, we screened our coverage universe for stocks that are BUY-rated by Argus Research analysts, have an Argus Financial Strength rating of at least Medium, and have a yield of 3.0% or higher. Here's a baker's dozen of stocks that meet the criteria.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. But the tide turned in 2022. The rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy companies and regional banks) that had lagged in recent quarters, and value stocks outpaced growth stocks over the past year. Meanwhile, the Federal Reserve continues to lift interest rates to fend off inflation, which could possibly cap multiple expansion for growth companies for a few more quarters. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.2%, compared to the 0.9% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. But the tide turned in 2022. The rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy companies and regional banks) that had lagged in recent quarters, and value stocks outpaced growth stocks over the past year. Meanwhile, the Federal Reserve continues to lift interest rates to fend off inflation, which could possibly cap multiple expansion for growth companies for a few more quarters. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.2%, compared to the 0.9% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Earnings season moved into higher gear on Thursday as investors weighed reports from a range of major companies, along with new housing market and employment data. Netflix and Tesla both fell following mixed reports and guidance, while Johnson & Johnson rose after reporting strong 2Q results and raising its full-year outlook. On the housing front, U.S. sales of existing homes fell to a five-month low in June. The National Association of Realtors said that existing home sales fell 3.3% last month to a seasonally adjusted annual rate of 4.16 million, below the Reuters consensus of 4.20 million. Meanwhile, first-time claims for state unemployment benefits fell by 9,000 to a seasonally adjusted 228,000 for the week ended July 15, below the Reuters consensus of 242,000. Continuing claims rose by 33,000 to 1.754 million. The Dow rose 0.47%, the S&P fell 0.68%, and the Nasdaq fell 2.05%. Crude oil rose slightly to $75.50 per barrel, while gold fell $9 to $1972 per ounce.

Stocks fell on Thursday amid mixed earnings reports and more signs of a slowing economy. The Conference Board said that its Leading Economic Index fell 1.2% in March to 108.4, the lowest level since November 2020. Housing market data was also weak, as existing home sales fell a greater-than-expected 2.4% in March, and weekly unemployment benefit claims pointed to a gradually tightening labor market. On the earnings front, Tesla shares dropped nearly 10% after the automaker reported disappointing first-quarter earnings and raised investor concerns about price cuts and margin pressure. AT&T also fell sharply after reporting slower subscriber growth and weak free cash flow. The Dow fell 0.33%, the

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. Since 2010, the Russell 1000 Growth Index has climbed more than 500%, compared to an advance of almost 300% for the Russell 1000 Value Index. In eight of the past 10 years, growth stocks have topped value stocks. That hasn't always been the case. In the 2000-2010 decade, which included two bear markets and the Great Recession, value stocks were better performers than growth stocks, advancing an admittedly low 8% -- but still better than growth, which declined 15% during the decade. Value investors trace their roots to the famous "Security Analysis" textbook, written in 1934 (the year Argus Research was founded) by Ben Graham, an economics professor at Columbia University. Warren Buffett was one of his students. Looking ahead, the rollout of COVID-19 vaccines has given a lift to some of the cyclical companies that have lagged in recent years, and value stocks outpaced growth stocks in the past year. Now, the Federal Reserve is lifting interest rates to fend off inflation, which likely will cap multiple expansion for growth companies. In any event, value is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.2%, compared to the 0.9% current yield on the iShares Russell 1000 Growth Index ETF. For our list this week, we have screened our coverage universe for stocks that are BUY-rated by Argus Research analysts, have a Financial Strength rating of at least Medium, and have a yield of 4.0% or higher. Here's a baker's dozen that meet the criteria.

Value stocks -- a market segment that includes high-yield stocks -- outperformed growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. But the tide turned in 2022. The rollout of COVID-19 vaccines gave a lift to some of the cyclical companies (energy companies and regional banks) that had lagged in recent quarters, and value stocks outpaced growth stocks over the past year. Meanwhile, the Federal Reserve continues to lift interest rates to fend off inflation, which could possibly cap multiple expansion for growth companies for a few more quarters. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.2%, compared to the 0.9% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Stocks were mostly higher in volatile trading on Thursday morning, led by the Energy and Consumer Discretionary sectors. GDP data was stronger than expected. In its advance estimate, the Commerce Department said that the U.S. economy expanded at a 2.9% annualized rate in 4Q, above the Bloomberg consensus forecast of 2.6% though down from 3.2% growth in 3Q. The Dow was flat, the S&P rose 0.3%, and the Nasdaq rose 0.7%. Crude oil rose nearly 2% to $81.50 per barrel, while gold fell $17 to $1926 per ounce.

Last week was the busiest of the quarter for corporate earnings, with a fair number of sharp moves in stock prices following above- or below-consensus results or changes in company guidance. Through October 25, Refinitiv reports that 129 S&P 500 companies have announced earnings, with 74% of those coming in ahead of the EPS consensus. The blended (reported and estimated) growth rate for the full quarter, however, is now at 3.3%. That's down from the 4.5% that was expected at the start of the quarter, which is likely a combination of the magnitude of the earnings misses as well as earnings estimates still coming down for those still scheduled to report. Sectors with the strongest beat rates so far have been Healthcare and Communication Services, where 100% of companies reporting have come in ahead of consensus. The biggest laggard has been Consumer Discretionary, where only 47% have exceeded consensus. Energy dominates, with a 119% blended earnings growth rate versus 3Q21, while Financials are at the other end with a 16% earnings decline. Our analysts are always on the lookout for companies that boost their outlooks during earnings season. Management's ability to "raise guidance" can often be a catalyst to strong returns in the quarters ahead. Here is an initial list of BUY-rated companies in Argus coverage for which management has raised guidance or increased its outlook during the 3Q22 EPS reporting season.

Stocks finished lower on Thursday after giving up early gains, as investors weighed mixed earnings reports along with new employment and housing market data. First-time claims for state unemployment benefits fell by 12,000 to 214,000 for the week ended October 15, below the Bloomberg consensus forecast of 230,000. Continuing claims rose by 21,000 to 1.385 million. On the housing front, existing home sales fell 1.5% in September to an annualized 4.71 million units, slightly above the consensus estimate. The Dow fell 0.30%, the S&P 0.80%, and the Nasdaq 0.61%. Crude oil rose to $86 per barrel, while gold fell slightly to $1633 per ounce.

Alternative investments are supposed to hedge against stock and bond market weakness. At least that's what the textbooks say. The most popular alternatives include Gold, Real Estate, Commodities, and, recently, Bitcoin. Only one of the alternatives (Commodities) has provided a respite for investors in 2022, with returns of 7% on the commodity benchmark ETF DBC. Gold isn't bad, down 5%. Real Estate held up early in the year -- but as interest rates have risen, the benchmark ETF IYR has fallen sharply and is down 21% YTD. Each of these is better than Crypto, of course. The approximately $1.0 trillion Cryptocurrency market has tumbled in recent months from $3.7 trillion amid a high level of volatility and a risk-off move in financial markets. Year-to-date, Bitcoin is down about 50%. In theory, consumers, investors, and traders are all attracted to Bitcoin. Given high inflation, we think Commodities will remain in demand and are the best-positioned alternative. In our view, Commodities should constitute up to 3%-5% of portfolios, with Copper and Paper/Corrugated Packaging having the most exposure due to positive long-term secular trends behind e-vehicles and e-commerce. We still think it is early to be adding volatile Bitcoin-related securities to our model portfolios at this time. We will reconsider Cryptocurrencies once the sector approaches total market capitalization of $5 trillion, or the regulatory outlook becomes clearer.

Value stocks -- a market segment that includes high-yield stocks -- are outperforming growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. Since 2010, the Russell 1000 Growth Index has climbed more than 600%, compared to an advance of 300% for the Russell 1000 Value Index. In nine of the past 10 years, growth stocks have topped value stocks. That wasn't always the case. In the 2000-2010 decade, which included two bear markets and the Great Recession, value stocks were better performers than growth stocks, advancing an admittedly low 8% (but still better than growth, which declined 15% during the decade). Value investors trace their roots to the famous "Security Analysis" textbook, written by Ben Graham, an economics professor at Columbia University. Warren Buffett was one of his students. Looking ahead, the roll-out of COVID-19 vaccines has given a lift to some of the cyclical companies (energy companies and regional banks) that have lagged in recent quarters, and value stocks have kept up the pace with growth stocks in the past year. Now, the Federal Reserve is lifting interest rates to fend off inflation, which will likely cap multiple expansion for growth companies. In any event, value is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.1%, compared to the 0.8% current yield on the iShares Russell 1000 Growth Index ETF. For our list this week, we have screened our coverage universe for stocks that are BUY-rated at Argus Research, have an Argus Financial Strength rating of at least Medium, and have a yield of 4.0% or higher. Here's a baker's dozen that meet the criteria.

Value stocks -- a market segment that includes high-yield stocks -- are outperforming growth stocks in 2022 for the first time since 2016. Indeed, for the past decade, the performance record has favored growth. In nine of the past 10 years, growth stocks have topped value stocks. But the tide may be turning. The rollout of COVID-19 vaccines has given a lift to some of the cyclical companies (energy companies and regional banks) that have lagged in recent quarters, and value stocks have kept up the pace with growth stocks in the past year. Now, the Federal Reserve lifting interest rates to fend off inflation, which will likely cap multiple expansion for growth companies. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 2.1%, compared to the 0.8% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Stocks rose strongly on Tuesday morning, led by the Communication Services and Basic Materials sectors. Housing data was weaker than expected. The Commerce Department said that U.S. housing starts fell 2% in June to an annualized 1.559 million, below the Reuters consensus forecast of 1.580 million, likely reflecting the impact of lower affordability as mortgage rates rise. Building permits fell 0.6% to an annualized 1.685 million, but topped the consensus forecast. The Dow rose 1.2%, the S&P 1.3%, and the Nasdaq 2.2%. Crude oil fell 1% to $101.50 per barrel, while gold traded near $1710 per ounce.

The cryptocurrency market (Bitcoin, Dogecoin, Ethereum, stablecoins, etc.) is approximately $1.0 trillion. But it has been tumbling in recent months from the $3.7 trillion level amid a high level of volatility and a risk-off move in the financial markets. Year-to-date, Bitcoin is down 55%, although in theory, consumers, investors, and traders all are attracted to Bitcoin. For consumers, cryptocurrency can cut out the middleman in a transaction of value. Yet we think current crypto volatility is too high to consider paying for a tank of gas (or even a Tesla) with Bitcoin. For traders, the ups and downs of various cryptocurrencies are a major opportunity -- as long as they are on the right side of Elon Musk's tweets, rapidly changing Chinese crypto regulations, or the Federal Reserve's policy changes that let the air out of risk-on assets. Investors wonder how far crypto is from becoming a mainstream security. We estimate that the global equity market capitalization is approximately $110 trillion. Gold is about $10 trillion. For crypto to make it on the asset-allocation model for most investment managers, it likely would need to quintuple in value to $5-$6 trillion. Then it could account for 2%-3% of total portfolio assets and could be used as a growth alternative. At that point, there might be more uses for (and regulations to define) the asset class, and more fundamentals to support valuation.

Stocks were mixed on Thursday morning after giving up strong early gains. Tesla shares rose more than 6% after the carmaker posted better-than-expected 1Q sales and earnings, helped by price increases that more than offset the impact of higher costs. American Airlines shares also rose strongly after the company posted a narrower-than-expected 1Q loss and forecast a return to profitability in the second quarter. The Dow rose 0.3%, the S&P rose 0.2%, and the Nasdaq fell 0.1%. Crude oil rose more than 1% to $103.50 per barrel, while gold fell $14 to $1942 per ounce.

The approximately $2.0 trillion cryptocurrency market (Bitcoin, Dogecoin, Ethereum, etc.) has been under pressure amid a high level of volatility and a risk-off move in the financial markets. For consumers, cryptocurrency can cut out the intermediary in a transaction of value. That said, we think crypto volatility is currently too high to consider paying for a tank of gas (or even a Tesla) with Bitcoin. For traders, the ups and downs of cryptocurrencies are a major opportunity -- as long as they are on the right side of Elon Musk's tweets or rapidly changing Chinese regulations. For investors, the main question is how far is crypto from becoming a mainstream security? We estimate that the global equity market capitalization is approximately $110 trillion. Gold is about $10 trillion. For crypto to make it on the radar for most investment managers' asset-allocation models, we would expect to see it approximately triple in value to $5-$6 trillion. Then it could account for 2%-3% of total portfolio assets and could be used as a growth alternative. Also by then, there will be more uses for and regulations to define the asset class, and more fundamentals to support valuation.

Value stocks -- a market segment that includes high-yield stocks -- are outperforming growth stocks in 2022. For the past decade, the performance record has favored growth. Since 2010, the Russell 1000 Growth Index has climbed more than 600%, compared to an advance of 300% for the Russell 1000 Value Index. In nine of the past 10 years, growth stocks have topped value stocks. That hasn't always been the case. In the 2000-2010 decade, including the Great Recession, value stocks were better performers than growth stocks, advancing an admittedly low 8% -- but still better than growth, which declined 15% during the decade. Value investors trace their roots to the famous "Security Analysis" textbook, written by Ben Graham, an economics professor at Columbia University. Warren Buffett was one of his students. The rollout of COVID-19 vaccines has given a lift to some of the cyclical companies (energy firms and regional banks) that have lagged in recent quarters, and value stocks have kept up the pace with growth stocks in the past year. Now, the Federal Reserve is poised to lift interest rates to fend off high inflation, which will likely cap multiple expansion for growth companies. In any event, value is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 1.6%, compared to the 0.5% current yield on the iShares Russell 1000 Growth Index ETF. For our list this week, we screened our coverage universe for stocks that are BUY-rated by Argus Research analysts, have a Financial Strength rating of at least Medium, and have a yield of 3.0% or higher. Here are 10 stocks that meet the criteria.

Value stocks -- a market segment that includes high-yield stocks -- are outperforming growth stocks in 2022. For the past decade, the performance record has favored growth, but the tide may be turning. The rollout of COVID-19 vaccines has given a lift to some of the cyclical companies (energy companies and regional banks) that have lagged in recent quarters, and value stocks have kept up the pace with growth stocks in the past year. Now, the Federal Reserve is poised to lift interest rates to fend off inflation, which will likely cap multiple expansion for growth companies. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 1.6%, compared to the 0.5% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Stocks plunged again on Tuesday morning after their wild swing on Monday amid continued interest rate concerns, mixed 4Q earnings reports, and the standoff with Russia over Ukraine. The IMF lowered its 2022 global economic growth forecast by 0.5 percentage points to 4.4%, reflecting a weaker outlook in both the U.S. and China. The IMF now projects 4.0% growth in the U.S. this year, down from its prior forecast of 5.2%. The Dow fell 1.4%, the S&P 2.2%, and the Nasdaq 2.8%. Crude oil rose to nearly $85 per barrel, while gold rose $5 to $1847 per ounce.

Explosive growth in mobile and fixed-line traffic is driving demand for robust data centers that are enabled for artificial intelligence (AI) and can manage rising and increasingly-complex traffic flow. Two-thirds of the world will have internet access by 2023, while the number of connected devices is expected to grow to three-times the global population. IoT (machine to machine or M2M) connections are expected to grow at a 30% CAGR. Security is a top need, as "denial of service" attacks are set to double by 2023. To handle the challenges of managing, storing, and securing data amid this explosive traffic growth, data centers will need to harness the power of artificial intelligence. AI enhances data center capabilities though the power of machine learning, inference, and deep learning, all in an application-accelerated environment. The AI data center also makes use of non-traditional and emerging technologies that provide more computing power than traditional CPU-based architectures. These include GPU Compute from NVidia and Tensor cores from Google/Alphabet. As of mid-year 2021, about 600 hyperscale data centers were in operation around the world, up from about 500 at year-end 2019 and double the number from five years ago. The bulk of data center construction is by hyperscale providers including AWS from Amazon.com, Microsoft Azure, Google Cloud from Alphabet, as well as with Chinese companies including Baidu and Alibaba. Co-location companies are another major data center driver, including Equinix and Digital Realty Trust. International Business Machines is providing hybrid cloud services that bridge public and private clouds. Other data center suppliers include semiconductor companies Broadcom, Marvell Technology, Intel, and Advanced Micro Devices. Stocks on the Argus Research BUY list that are in position to benefit include the following.

The cryptocurrency market (i.e. Bitcoin, Dogecoin, Ethereum, etc.) is approximately $3.1 trillion, but has been tumbling in recent days from the $3.7 trillion level amid a high level of volatility. Even in light of the sell-off, Bitcoin is up more than 50% year-to-date. In theory, consumers, investors, and traders can all be attracted to Bitcoin. For consumers, cryptocurrency can cut out the middleman in a transaction of value. That said, we think crypto volatility is too high to consider paying for a tank of gas (or even a Tesla) with Bitcoin. For traders, the ups and downs of cryptocurrencies are a major opportunity -- as long as they are on the right side of Elon Musk's tweets or rapidly changing Chinese crypto regulations. For investors, the goal is to determine when crypto will become a more mainstream security. We estimate the global equity market capitalization is approximately $110 trillion. Gold is about $10 trillion. For crypto to make it into the asset-allocation models for most investment managers, we think it needs to approximately double in value to $5-$6 trillion. Then it could account for 2%-3% of total portfolio assets and could be used as a growth alternative. By then, there also may be more uses for and regulations to define the asset class, and more fundamentals to support valuation.

Stocks were mixed on Thursday morning amid continued concerns about accelerating inflation. Disney shares fell more than 7% after the company posted disappointing fiscal 4Q earnings and much lower than expected growth in Disney+ subscriptions. The Dow fell 0.2%, the S&P rose 0.2%, and the Nasdaq rose 0.8%. Crude oil rose slightly to $81.50 per barrel, while gold traded near $1864 per ounce.

Stocks were mixed on Thursday morning following earnings reports from IBM, Tesla, and Blackstone, and new employment data. IBM shares fell more than 7% after the company posted weaker-than-expected third-quarter revenue, while Tesla rose 3% after strong 3Q earnings, driven by record vehicle deliveries. On the employment front, the Labor Department said that first-time claims for state unemployment benefits fell to 290,000 for the week ended October 16, down from 296,000 a week earlier and below the consensus forecast of 297,000. The Dow fell 0.2%, the S&P was flat, and the Nasdaq rose 0.4%. Crude oil fell more than 1% to $82 per barrel, while gold traded near $1781 per ounce.

The Portfolio Selector features the Argus Focus List, a group of 30 "best idea" stocks generated and regularly updated by Argus' analysts and investment policy committee. It also includes the director of research’s monthly investment strategy column, stock recommendations and sector picks, economic forecasts, and an asset allocation model. This month, the Focus List additions are DuPont de Nemours Inc (DD); Hilton Worldwide Holdings Inc (HLT); Twilio Inc (TWLO); Corning, Inc. (GLW) and the Focus List deletions are LyondellBasell Industries NV (LYB); American Electric Power Co Inc (AEP); International Business Machine (IBM); T-Mobile US Inc (TMUS); Restaurant Brands Intl In (QSR).

Stocks rose on Thursday in a broad-based rally as investors are more optimistic about the possibility of a debt ceiling resolution. The Dow is 2% away from its all-time high. The Labor Department reported that initial unemployment claims for the week ended October 2 were 326,000, compared to an expected 348,000 and an upwardly revised 364,000 during prior week. Continuing claims for the week ended September 25 were 2.7 million, less than the 2.8 million expected. The Dow rose 1%, the S&P 0.8%, and the Nasdaq 1.1%. Crude oil rose to near $79 per barrel, while gold fell almost $6 to $1756 per ounce.

Stocks rose on Thursday in a broad-based rally as investors are more optimistic about the possibility of a debt ceiling resolution. The Dow is 2% away from its all-time high. The Labor Department reported that initial unemployment claims for the week ended October 2 were 326,000, compared to an expected 348,000 and an upwardly revised 364,000 during prior week. Continuing claims for the week ended September 25 were 2.7 million, less than the 2.8 million expected. The Dow rose 1%, the S&P 0.8%, and the Nasdaq 1.1%. Crude oil rose to near $79 per barrel, while gold fell almost $6 to $1756 per ounce.

The Technology sector started slowly in 2021 as investors focused on value stocks. But the sector has come on strong in recent months (up 22% year-to-date) and now is outperforming the market (up 20.7%) as well as value sectors such as Consumer Staples (+8%), Utilities (+10%), Materials (+17%), and Industrials (+18%). The sector is the largest in the U.S. market and now accounts for more than 28% of the S&P 500. Over the long term, we expect the sector to benefit from pervasive digitization across the economy, greater acceptance of transformative technologies, and the development of the Internet of Things (IoT). Healthy company and sector fundamentals are also positive. For individual companies, these include high cash levels, low debt, and broad international business exposure. We have an Over-Weight ranking on the Tech sector and think investors should look to allocate up to 30% of their diversified portfolios to the group. Here is how we use our analysts' Tech sector ideas in our Focus List and Model Portfolios.

The approximately $1.6 trillion cryptocurrency market (Bitcoin, Dogecoin, etc.) has been volatile. Issues include increased participation from institutional investors; Tesla's Elon Musk halting acceptance of Bitcoin for Tesla products due to environmental concerns; China saying it would not allow financial institutions to provide services related to crypto transactions; and Colonial Pipeline paying Bitcoin as ransom to hackers who shut it down, furthering the notion that cryptocurrencies are ideal for enterprises seeking to evade laws. Prior to the headlines, cryptocurrencies had been on a tear, with Bitcoin up some 300% over the past year, despite no clear path to widespread adoption by consumers or businesses, and amid uncertainty over regulation. What's next and how far is crypto from becoming mainstream? We estimate the global equity market capitalization is about $90 trillion. Gold is about $10 trillion. For crypto to make it on the radar of most investment managers, we think it would need to at least triple in value to about $5 trillion. By then, maybe there will be more uses for and regulations to define the asset and more fundamentals to support valuation; this has worked for gold over the years. For the broader market, volatile crypto prices signal excessive liquidity in the system, and worries could spill over into other asset classes.

Value stocks are outperforming growth in 2021 for the first time since 2016. While a recent rally in growth stocks has narrowed the performance advantage for value in the year to date, an environment of historically low interest rates is one in which many investors are still searching for high levels of income -- which often can be found in value stocks. When we look for attractive high-yield/deep-value stocks at Argus, we look for low valuations on metrics such as price/earnings, price/sales, price/book, yield, and price/cash flow. We also look for companies with clean balance sheets, high levels of profitability, high-quality earnings, and experienced management teams. We seek to avoid companies in industries that are in secular decline, or with dividend yields that are so high that the payout is clearly at risk. Based on numerous requests from clients, we have designed a portfolio of companies that are BUY-rated at Argus Research, have a Financial Strength rating of at least Medium, and have a yield of 3.0% or higher.

Stocks rose on Tuesday morning, recouping some of Monday's sharp losses. IBM reported strong 2Q earnings and housing market data was mixed. The Commerce Department said that U.S. housing starts rose 6.3% to a seasonally adjusted annual rate of 1.643 million units in June, above the Reuters forecast of 1.590 million. However, building permits, a longer-range indicator, fell 5.1% to an annualized 1.598 million. The Dow rose 1.6%, the S&P 1.4%, and the Nasdaq 1.0%. Crude oil traded near $67 per barrel, while gold fell slightly to $1808 per ounce.

The Fed Calms the Markets: Our Monthly Survey of the Economy, Interest Rates, and Markets

The approximately $1.7 trillion cryptocurrency market (Bitcoin, Etherium, Dogecoin, etc.) has been tumbling from a $2 trillion-plus level on a flurry of negative developments. These include Tesla's Elon Musk halting acceptance of Bitcoin for Tesla products due to environmental concerns; China saying it would not allow financial institutions to provide services related to crypto transactions; and Colonial Pipeline paying Bitcoin as ransom to hackers, furthering the notion that cryptocurrencies are ideal for enterprises seeking to evade laws. Prior to the headlines, cryptocurrencies were on a tear despite no clear path to widespread adoption by consumers or businesses, and amid uncertainty over regulation. We estimate that the global equity market capitalization is approximately $90 trillion. Gold is about $10 trillion. For crypto to make it on the radar for most investment managers' asset-allocation models, we expect it needs to at least triple in value, to approximately $5 trillion. By then, maybe there will be more uses for and regulations to define the asset, and more fundamentals to support valuation; this has worked for gold over the years. For the broader market, collapsing crypto prices also signal excessive liquidity in the system, and worries could spill over into other asset classes. Essentially, markets are in risk-off mode when Bitcoin tanks.

With April winding down, you can count on someone, somewhere saying, "sell in May and go away." That pronouncement is mainly popular because it rhymes. While it is true that summer is typically a period of relative underperformance, market timing rarely works. And sometimes summer is a good time for stock performance.

With April winding down, you can count on someone, somewhere saying, "sell in May and go away." That pronouncement is mainly popular because it rhymes. While it is true that summer is typically a period of relative underperformance, market timing rarely works. And sometimes summer is a good time for stock performance.

Stocks fell for a second day on Tuesday morning, led by sharp declines in the Financial and Energy sectors. IBM shares rose more than 4% following stronger-than-expected first-quarter sales and earnings, helped by strength in the company's cloud computing business. On the negative side, Abbott Laboratories fell sharply after reporting slightly lower than expected sales, including a sequential decline in revenue from coronavirus test kits. The Dow fell 0.9%, the S&P 0.9%, and the Nasdaq 1.1%. Crude oil traded near $62 per barrel, while gold rose $9 to $1780 per ounce.