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Market Sees First Green of the Week

Jim Giaquinto

We certainly didn’t get a robust bounceback rally on Thursday after two days of losses, but the major indices did record their first gains of this shortened week.

Hey, when the market’s in a sour mood, we need to take whatever we can get!

The Dow advanced 0.17% (or about 43 points) to 25,169.88. This performance didn’t make a dent in the losses over the previous two sessions, but it marked the first time this week that the index didn’t plunge by more than 200 points.

The S&P couldn’t recapture 2800 after slipping below the mark yesterday, but it still advanced 0.21% to 2788.86.

The best performer (on a percentage basis) was actually the NASDAQ, which advanced 0.27% (or about 20 points) to 7567.72.

It was another choppy session with the indices completely giving up morning gains by midday, before regrouping and heading higher late in the session.

Stocks have been under pressure for weeks as the trade dispute with China remains unresolved and seems to be getting more heated. More recently, declining bond yields have investors worried about slower economic growth and even recession.

As a result, May will be the first negative month of 2019 as stocks are off approximately 5%. Meanwhile, the Dow is on its way to a sixth week in the red, while the other two major indices are working on their four straight week of losses.

The fantastic news is that May is almost over and we head into June with solid gains for the year. Unfortunately, the market’s sentiment has taken a turn for the worse from the good old days (just a few weeks back) when we thought a trade deal was on the way. But the economy is still strong, as evidenced by the second reading for Q1 GDP at 3.1%. The big question heading forward into the summer months is: How long will this economy remain resilient during this trade dispute?

Today's Portfolio Highlights:

Blockchain Innovators: You can consider Pyxus (PYX) to be a two-fer. Not only is this agricultural and consumer products company diving into the cannabis business, but it’s also using blockchain to track the platform for its products. That’s two of the fastest-growing spaces in the market! Of course, Dave is most interested in blockchain, which PYX uses to track its cannabis products from origins all the way through its use by customers. Read the complete commentary for more on this new addition.

Stocks Under $10: You’ve probably heard rumors that Everi Holdings (EVRI) is exploring a sale. But Brian Bolan isn’t so sure, especially after such a solid quarter for this provider of gaming payment solutions and slot machines. The editor smells a 'head fake'. Nevertheless, he sees this as a good time to sell EVRI and collect a 64.3% return in approximately 4 months.

The portfolio immediately replaced this name by adding Tecnoglass (TGLS), a Zacks Rank #2 (Buy) that manufactures and sells architectural glass & windows and aluminum products for the residential and commercial construction industries. The company has beaten the Zacks Consensus Estimate in three of the last four reports and its valuation is very attractive. Plus, Brian likes its topline growth expectation of 26%. Read the full write-up for more.

Technology Innovators: One of the strongest areas of the market during these hectic times is the solar space, which seems to be divorcing itself from movements in oil and becoming a real replacement for traditional energy sources. Therefore, Brian Bolan went to this industry for his newest addition to the portfolio and picked up Azure Power (AZRE). While estimates have been stagnant of late, the editor is impressed with its history of earnings surprises that includes an average beat of more than 100% over the past four quarters. In addition, the chart is telling Brian that AZRE has been 'basing' for a while and could move sharply to the upside on good news. Read the full write-up for a lot more on this new addition.

Until Tomorrow,
Jim Giaquinto

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