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Strong Friday Close Secures a 9th Week in the Green

Jim Giaquinto

Eat your heart out, Mariano Rivera! The market knows how to close too… at least it did this week. After a couple of slight gains and a down session, positive trade talk on Friday pushed stocks to a ninth straight week of gains.

We needed a solid session today to keep this winning streak going, and that’s just what we got. The Dow crossed back over 26,000 with a jump of 0.70% (or about 181 points) to 26,031.81. The NASDAQ rose 0.91% to 7527.54 as all FAANGs advanced by more than 1%, except Amazon (+0.75%).

The Dow was up 0.6% this week and the NASDAQ increased 0.7%, securing 9 weeks in the green for both.

The S&P is knocking on the door of 2800 after today’s advance of 0.64% to 2792.67, marking a weekly rise of 0.6%. The index is now up for four consecutive weeks and in 8 of the last 9.

China negotiators were in Washington this week for another round of trade talks. President Trump met with China’s Vice Premier Liu He today and is working on a meeting with President Xi sometime next month. The delegation will stay in the country a couple extra days for more discussions.

As with last week, the vibes coming from the meetings have been quite positive. It culminated today with the President saying that a deal is more likely to happen than not. The statement helped the major indices rally out the session after a late dip.

Today's Portfolio Highlights:

Counterstrike: For more than two months now, yoga-inspired apparel dynamo Lululemon (LULU) has been performing well for the portfolio. But that’s a long stay for this service! And Jeremy feels that we might see some consolidation before it heads higher again. In an effort to prepare for the earnings off-season, the editor decided to sell LULU on Friday and bank its gain of 27.2%. He’ll jump back in if it pulls back under $140.

Meanwhile, shares of online & offline marketplaces provider Etsy (ETSY) are rising ahead of its quarterly report next week. However, Jeremy doesn’t want to risk this gain in front of what could be a volatile time. He sold ETSY for a profit of 10.4%. He originally bought this name in late December and then added more earlier this month. Half of Illumina (ILMN) was also sold for 1.9%.

Technology Innovators: Cyber security stocks have run into a little pressure of late, but Brian Bolan still likes the space. He found a company that posted a beat and raised its EPS guidance in its most recent report, yet sold off a bit on a soft revenue guidance. Radware (RDWR) is a Zacks Rank #2 (Buy) with a great history of beating the Zacks Consensus Estimate. It has an average beat of more than 30% over the past four quarter, but what the editor really likes is that the positive surprises have been increasing over that time. Read the complete commentary for a lot more on this new addition.

Home Run Investor: The market is feeling pretty good about a trade deal with China at some point in the near future, but such a deal would not help Kratos Defense (KTOS). This defense play, which is mostly known for its focus on drones, is not sourcing from China. Since Brian Bolan was looking to take some gains today, he felt that selling KTOS for a 23.1% return would do the trick. The editor added this name exactly one month ago today.

Insider Trader: Shares of Brookdale Senior Living (BKD) have struggled along with other senior living facilities of late. The stock is still down 14% over the last six months. But the CEO and two directors apparently think its just too cheap at this level, as they all bought shares of their own company earlier this week. Tracey decided to add BKD on Friday with a 10% allocation. But that wasn’t all…

The market rally this year hasn’t helped EQT (EQT) very much, as this natural gas production company has only gained 3.8% so far this year. Its still off 30% in the past 6 months. But this week we saw the General Counsel, the SVP of Human Resources and the CEO all buy shares. (By the way, the SVP’s purchase of more than $320,000 of stock is one of the biggest purchases Tracey has ever seen for an HR insider.) The editor added EQT with a 10% allocation as well, which leaves plenty of cash for future buys. Learn a lot more about today’s moves in the full write-up.

Blockchain Innovators: If you’ve ever bought a house, then you know the crazy amount of paperwork, money and time it takes to get your mortgage and close the deal. Well, OneSpan (OSPN) is using blockchain to make it simpler, which has certainly interested Dave as he’s been looking for a name that’s “elbow-deep in blockchain utilization”. OSPN is also a Zacks Rank #2 (Buy) that’s coming off an earnings beat of more than 140%. Read the complete commentary for more on this new buy.

Healthcare Innovators: Ever since cashing in CRISPR Therapeutics (CRSP) for a 32% gain in January, Kevin has been chomping at the bit to get back into this gene editing pioneer. Well, now that it has survived the Sangamo fall-out, he thinks this is the time to make his move. The editor added CRSP on Friday with the risk/reward favoring an advance to more than $40 this year before heading lower. Read the full write-up for more.

Surprise Trader: Over the past 30 days, next quarter’s earnings estimates for Xencor (XNCR) have surged to a profit of 18 cents from a loss of 46 cents. Such a sharp advance has Dave feeling pretty good about this clinical-stage biopharma’s company’s quarterly report coming after the bell on Monday. It’s also nice to see a positive Earnings ESP of 8.86%. The editor put the portfolio’s remaining cash into XNCR. Read more in the full write-up.

Have a Great Weekend!
Jim Giaquinto

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