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Dow Manages Slight Gain Despite Anxious Market

Jim Giaquinto

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The market remains concerned about slowing economic growth and the inverted yield curve, but fortunately there wasn’t much of a follow through from Friday’s sharp selloff. In fact, the Dow closed in the green.

The index inched forward today by 0.06% (or about 14 points) to 25,516.83. It slipped from a high of more than 100 points in the session, but at least it managed to reverse course after plunging 460 points on Friday.

The other major indices came pretty close to joining the Dow on the plus side, yet they had to settle with slight losses. The NASDAQ dipped 0.07% to 7637.54. The S&P finally surrendered the 2800 mark by less than 2 points. It was off 0.08% to 2798.36.

It was a pretty eventful day in the market even if stocks didn't move very much. Apple came out with a suite of new services, including the Apple TV+ streaming platform and a credit card aptly dubbed the Apple Card.

However, the established streaming companies didn’t seem too intimidated. While Apple was down 1.2% on Monday, shares of Netflix were up 1.45% and shares of Roku advanced 4.7%. We still don’t know the cost of Apple TV+, though it is scheduled for release in the fall and has some impressive celebrities all set to make content (including Steven Spielberg and Oprah).

Meanwhile, Robert Mueller’s two-year investigation is finally over… with no indictments for President Trump, his staff or his family for colluding with Russia to influence the 2016 election. Regardless of which way you lean politically, it’s a good thing for the market that this is behind us. Stocks have held up relatively well to all the craziness in Washington, but impeachment proceedings would probably be a different thing altogether.

And you didn’t think we’d get through a whole summary without mentioning trade, did you? Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer will be headed back to China later this week for another round of talks. Meanwhile, Vice Premier Liu He will make his way to Washington in the following week. So we can expect more headlines in the coming days... but probably not much real progress.

We're really waiting for the meeting  between President Trump and China President Xi, which would hopefully signal that the two sides are ready to make a deal.

Today's Portfolio Highlights:

Blockchain Innovators:
There are a lot of companies investing in blockchain right now, but Information Services Group (III) actually has a division named after it. Blockchain Now is an “advisory and sourcing solution that enables enterprise clients to improve the efficiency, accuracy and security of their business processes through distributed ledger technology.” Besides blockchain, the company’s Robotics Process Automation is a growing space that analysts are watching. Given this potential for the future, Dave feels just fine about adding this technology research and advisory company even though it has a low Zacks Rank at the moment. Read the full write up for a lot more on III.

Counterstrike: Specialty retailer Abercrombie & Fitch (ANF) and software company Guidewire Software (GWRE) may not seem to have a lot in common… but Jeremy begs to differ. Both companies reported strong quarterly numbers with ANF surprising by 20% and GWRE beating by 79%. They also both initially jumped on the results, but high-frequency traders subsequently pulled them back down. The editor believes these stocks are bound to recover the recent losses and then some, especially since they have really good-looking charts. He added these names on Monday with an 8% allocation for each. Read the full write-up for more.

Black Box Trader: This week’s adjustment included a couple of swaps. The portfolio got out of Tronox Ltd. (TROX, +2%) and Diebold (DBD). These spots were filled by buying Dana Inc. (DAN) and Mallinckrodt (MNK). Read the Black Box Trader's Guide to learn more about this computer-driven service designed to take the emotion out of investing.

Have a Good Evening,
Jim Giaquinto

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