The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles to a large degree - have moved overseas, where labor and materials costs are lower. Yet the U.S. economy, even during the pandemic and the current period of high inflation, has expanded to record levels. If U.S. corporations weren't innovating, creating new products (such as vaccines and AI) and services (such as Zoom calls) and moving into new markets, the domestic economy would not be growing, and capital would not be flooding into the country. The current high level of the U.S. dollar relative to currencies around the world attests to the confidence that global investors have in the durable and innovative U.S. economy.

Monday Tee Up: A Super Week

The major stock indices remain stuck in fairly narrow ranges, while the rest of the market has been pretty weak in 2024. That weakness actually started in mid-December, and the daily NYSE advance/decline line has been in a downtrend channel for a month. However, we have not seen nearly enough price weakness from the S&P 500 (SPX), Nasdaq, or Nasdaq 100 (QQQ) to call for at least some short-term caution, although it sure looks like it is coming.

Stocks ended nearly flat after recovering from earlier losses on Thursday after the December inflation reading came in higher than expected. Headline CPI rose 0.3%, up from 0.1% in November and ahead of the expected 0.2% increase. This brings the annual rate to 3.4%, up from 3.1% last month. Initial jobless claims were 202,000 this week, falling 1,000 from the previous week's revised level and the lowest since mid-October. Ongoing unemployment was 1,834,000, down 34,000 from the prior week. In other news, eleven bitcoin ETFs began trading on Thursday. The Dow rose less than 0.1% the S&P 500 fell 0.1% and the Nasdaq was flat. Crude oil traded above $72 per barrel, while gold rose $5 to $2033 per ounce.

Stocks rebounded nicely on Thursday after the Wednesday thrashing. This potentially classifies Wednesday's thumping as a one-day wonder, which implies the current rally off the October lows isn't quite done yet. The problem is that a rally to new recovery/all-time highs is likely to incur a daily bearish momentum divergence. While one such event is just a warning, it raises the possibility that a reset is needed. As we have said of late, both daily momentum and breadth have reached extreme overbought conditions, while sentiment is scorching hot. So a pause/pullback might be in the cards.

Sustainable Impact Investing, or ESG investing, is gaining traction not only with Argus Research clients but also with the global investment community. BlackRock CEO Lawrence Fink, who oversees approximately $9 trillion in assets, announced in January 2020 that his firm would be investing in companies that are making progress on sustainability. He doubled down in his January 2021 letter, calling on company managements to disclose their plans for making their businesses "compatible with a net-zero economy" by 2050. As assets have flowed in over the past 40 years, Sustainable Impact Investing has evolved. The discipline, originally known as Socially Responsible Investing, focused at first on excluding companies that conducted business in South Africa, or participated in industries such as tobacco, alcohol, and firearms. Performance of these initial strategies lagged, and the approach has been modified. Now, instead of merely identifying industries to avoid, the discipline promotes "sustainable" business practices across all industries that can have an "impact" on global issues such as climate, hunger, poverty, disease, shelter, and workers' rights.

Sustainable Impact Investing, or ESG investing, is gaining traction not only with Argus Research clients but also with the global investment community. BlackRock CEO Lawrence Fink, who oversees approximately $9 trillion in assets, announced in January 2020 that his firm would be investing in companies that are making progress on sustainability. He doubled down in his January 2021 letter, calling on company managements to disclose their plans for making their businesses "compatible with a net-zero economy" by 2050. As assets have flowed in over the past 40 years, Sustainable Impact Investing has evolved. The discipline, originally known as Socially Responsible Investing, focused at first on excluding companies that conducted business in South Africa, or participated in industries such as tobacco, alcohol, and firearms. Performance of these initial strategies lagged, and the approach has been modified. Now, instead of merely identifying industries to avoid, the discipline promotes "sustainable" business practices across all industries that can have an "impact" on global issues such as climate, hunger, poverty, disease, shelter, and workers' rights.

Investing in the Cloud is not for the faint of heart -- but we see upside. Alphabet lost a steep 10% in one day last week after investors expressed their disappointment over growth in its cloud business. That same day, Microsoft surged after reporting better-than-expected growth in its Azure OpenAI cloud service. The race is on, and some will win and some will lose along the way. But the potential pie is big. In the internet era, in which digital commerce complements or has supplanted physical commerce, the information technology needs of all enterprises have grown. The traditional on-premises approach has been rendered inefficient, given that a user's IT needs may fluctuate at any time. Into this void, the Cloud has arrived. In Cloud services models, an enterprise's IT needs can be matched and scaled in real time. Through the Cloud, enterprises consume only as much computing, storage, and networking bandwidth as they need. For a major event, this allows massive scaling of IT resources beyond the restraints of on-premises implementation. For periods in which operations are steady, the Cloud services model allows for a needs-only application. The leading providers of Cloud services tend to be large Technology and Communication Services companies that provide many goods and services distinct from or adjacent to their Cloud businesses. Growth has been impressive for this group. Collectively, participants in the Cloud eco-system grew revenue at a 19% compound annual growth rate from 2016 to 2022. Still, the line isn't straight up. While Cloud services grew at a 23% growth rate from 2020 to 2021, the average growth rate slowed to 15.3% for 2022. This slowdown in revenue growth reflected impediments to normal business activity from the supply-chain crisis, inflation, and rising interest rates. Even so, demand for Cloud services has held up relatively well, given that Cloud transition is a long-tailed process and that Cloud transformation has become an imperative. Here is a list of U.S.-based companies followed by Argus and that we think are in position to take advantage of this secular trend.

Will the Fed spook the markets with their next call on interest rates this week? As well, the calendar flips to November -- so the October jobs report is equally (if not more) important news. Finally, investors face the ongoing release of earnings. Last week, the Dow Jones Industrial Average was down 2.1%, the S&P 500 shed 2.5%, and the Nasdaq lost 2.6%. Year-to-date, the DJIA is now down 2%, the S&P 500 is up 7%, and the Nasdaq is higher by 21%.

Innovation may be hard to define. But to borrow from former U.S. Supreme Court Justice Potter Stewart, you know it when you see it. The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles to a large degree - have moved overseas, where labor and materials costs are lower. Yet the U.S. economy, even during the pandemic and the current period of high inflation, has expanded to record levels. If U.S. corporations weren't innovating, creating new products (such as vaccines) and services (such as Zoom calls) and moving into new markets and applications, the domestic economy would not be growing, and capital would not be flooding into the country. The current high level of the U.S. dollar relative to currencies around the world attests to the confidence that global investors have in the durable and innovative U.S. economy.

Monday Tee Up: War, Earnings, Powell

When we dissect the 11charts for the S&P 500 sectors, there isn't much to get excited about -- unless you are a bear. For the year-to-date, we see a pretty wide dispersion of returns, with the winners benefiting from rallies that were at the beginning of the year as well as after the March pullback and up to their yearly highs in July. For the losers, the weakness started in the beginning of the year and has kicked in again since mid-September, when we saw some wicked downside acceleration, especially in the interest-sensitive and defensive sectors.

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.

A review of the charts for the 500 stocks in the S&P 500 (SPX) may well leave one feeling a tad queasy. It is not a universally pretty sight -- which is a bit disconcerting as the major indices are holding near recovery highs. The small-cap stocks remain in a stagnant pool -- and if it weren't for the fact that the indices are market-cap weighted, the overall stock market outlook might be very different.

Most stock indices registered solid gains on Wednesday. Going into NVIDIA's (NVDA) important EPS report, Technology (XLK) popped 2.5% and again was led by semiconductors. The VanEck Semi ETF (SMH), the iShares Semi ETF (SOXX), and the SPDR S&P Semi ETF (XSD), all rose 2% to 2.3%. Internet stocks led Communication Services (XLC), with a broad list of mega-caps contributing to the advance. After the close, NVDA beat the stock pushed higher.

The dog days of summer may be perfect for a vacation at the beach, but investors don't always get to enjoy the month of August. Indeed, our analysis of monthly returns going back to 1980 indicates that August is ahead of only one other month (September) in terms of average return. Yes there have been some hits. The month has a "win percentage" of 55%, and in 2020 the S&P 500 popped 7.3% in the month. But there have been some clunkers as well, including 1981 (-6%), 1990 (-9.4%), 1998 (-14.6%), 2001 (-6.4%), and 2015 (-6.3%). Last year was a bummer, with a 4.2% drop. Generally, August is a quiet month on Wall Street. The second-quarter earnings reports are mostly finished in July, with a few retail and tech stragglers still left to announce results. The IPO market, quiet already this year, often goes into a period of hibernation. Volume tends to be light -- which is perfect for higher volatility. This August, volatility may spike as the Federal Reserve debates changes to policy at its annual retreat in Jackson Hole, WY, and the 2024 presidential election campaign gets under way with a round of Republican debates. Meanwhile, investors remain unsure whether the central bank can guide the economy to a soft landing or instead will usher in a recession between now and the end of 2024. We continue to stress a focus on quality -- strong earnings, balance sheets, and management teams -- as the markets approach what typically has been a difficult two-month stretch.

Once again, the stock market was faced with higher interest rates and a higher U.S. Dollar Index (USD). Generally, this is not a good scenario for stocks, especially after the run we have had since March. Higher yields and a rallying greenback also led to some weakness in gold and silver. Investors also may be sitting on their hands, as this is another big earnings week with AAPL and AMZN reporting later in the week.

Argus Research believes that ESG investing is a smart option to consider. Companies committed to ESG values typically reflect positive traits from management which often translate into better business. ESG (Environmental, Social, Governance) investing has come a long way and continues to grow. According to the Global Sustainable Investment Association, global assets under management in ESG strategies were $40 trillion in 2020, up from $23 trillion in 2016 and on track for $50 trillion by 2025. The discipline, originally known as Socially Responsible Investing, focused at first on excluding companies that conducted business in South Africa, or participated in industries such as tobacco, alcohol, and firearms. In time, the list of industries to avoid increased to include soft drinks, fast food, and oil and gas, among numerous others. But performance of these initial strategies lagged. Now, instead of merely identifying industries to avoid, the discipline promotes "sustainable" business practices across industries that have an "impact" on global issues such as climate, hunger, poverty, disease, shelter, and workers' rights. At Argus Research, we track ESG progress at specific companies as part of our Management analysis -- one of the six points in our proprietary Six-Point System for fundamental research. In addition to reviewing and measuring the ESG proclamations from companies under coverage, we partner with an ESG research firm, JUST Capital, and leverage its analysis and insights. JUST Capital's mission is to drive measurable corporate change to create a stakeholder-centric form of capitalism that reflects the priorities of the American public. JUST utilizes a combination of data-driven research and strategic engagement in an attempt to shift norms and practices in corporate America and the financial markets. JUST ESG Custom Ratings rank stocks in the Russell 1000 on criteria using a scale of 1-100. Drawing on the JUST Capital rankings, we have compiled focused lists of companies followed by Argus Research that are in position to have a "sustainable impact" on the environment, workplace, community, and marketplace. These firms have exemplary records of delivering on the bottom line, and also in improving the environment, contributing to community relations, and showing respect for their employees. We also have a theme model portfolio based in part on ESG criteria. To build the Argus U.S. ESG Theme Model Portfolio, we apply financial concepts such as industry diversification, income generation, risk reduction, and growth at a reasonable price to our various lists. In addition, all stocks must be on the Argus BUY list. For more on JUST Capital's criteria, please visit the JUST Capital website, www.justcapital.com. For more information on the Argus companies, please see our Analyst Reports at www.argusresearch.com. Here are some of the stocks that are currently in the Argus U.S. ESG Theme Model Portfolio.

In this edition, market makes missteps around Google's search; ResMed revs up; industry landscape on consumer packaged goods; and Canfor, LPL Financial, and Boeing.

Stocks rose on Thursday morning, led by strong gains in the Communication Services, Consumer Discretionary, and Technology sectors after a wide range of earnings reports. The gains came a day after an expected 25-basis-point rate hike by the Federal Reserve. Fed Chair Jerome Powell also said that an additional rate hike was possible in September. The Dow rose 0.1%, the S&P 0.5%, and the Nasdaq 1.1%. Crude oil rose nearly 2% to $80 per barrel, while gold fell sharply to $1945 per ounce.

In this edition, streaming services changing their channels; BRP looks promising; China's AI is calling; and Autoliv, Sirius XM, and American Express.

One way to take a deeper dive on market breadth is to look at the percentage of stocks in each of the 11 S&P 500 sectors that are over their 200-day averages. We do this a lot with the major indices -- but have not drilled down to the sector level in a while. Of course (and speaking generally), if a sector is doing well and outperforming, one can expect that most stocks in the sector are over their 200-day.

Vickers Stock Research, a subsidiary of Argus Research Group, tracks and analyzes insider trading and institutional stock ownership trends. Form 13-Fs, which institutions must file to report their holdings, are due 45 days after the end of calendar quarters, and have now come in from 1Q23. We review the 13Fs of the major activist investors, including Carl Icahn, Trian Fund Management, Jana Partners and ValueAct Holdings, among others, in order to determine their core holdings and new purchases. Activist investing has evolved in recent years and is now less about generating a short-term return on an underpriced stock and more about achieving long-term returns through an active management/investor partnership. Activists have made progress in the past year with high-profile investments into blue-chip companies such as FedEx Inc. and Union Pacific. Based on Vickers data, here are some recent new purchases and key holdings of Activist investors, as well as other high-profile money managers such as Warren Buffet of Berkshire Hathaway and Ken Griffin of Citadel Advisors LLC.

Innovation may be hard to define but, to borrow from former U.S. Supreme Court Justice Potter Stewart, you know it when you see it. The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles, to a large degree - have moved overseas, where costs are lower. Yet the U.S. economy is at its largest point in history and still growing. If U.S. corporations weren't innovating, creating new products and services, and moving into new markets and applications, the domestic economy would be contracting, not expanding, and capital would not be flooding into the country. Particularly at this juncture of the market and economic cycles, when uncertainty is high due to high inflation and rising interest rates, we look to innovative companies to successfully navigate the challenges. At Argus, an 88-year-old independent research firm that has innovated a time or two in its long history, we have focused on four types of innovative companies: Industry Disruptors; First to Market; New Product Specialists; and Product & Process Perfectors. Here are some examples of companies, featured in our Innovation Theme Model Portfolio.

The S&P 500 was up 0.9% before dividends in April, thus logging its third monthly gain in 2023. If the historical track holds, the index could grow further in May. Indeed, the stock market typically rises in May (on average 0.9%, with a 70% winning percentage). We note that market returns in May have exceeded 5% on six occasions since 1980, including a 9.2% gain in 2000; and 2020 was close, at 4.5%. But there have been some clunkers in May as well, such as 2010 (-8.2%), 2019 (-6.6%), 2012 (-6.0%), and 1984 (-5.9%). May starts as a busy month on Wall Street, as companies report their first-quarter earnings, the Federal Reserve meets, and the Nonfarm Payrolls report is released. But once the retailers wrap up their results, investors are left to ponder inflation trends, future Federal Reserve activity, the risk of recession, and the long Memorial Day weekend. Looking ahead, we are bullish on stocks for 2023, expecting interest rates to decline, the consumer sector of the economy to remain in growth mode, valuations to be more reasonable, and earnings to recover in the second half of the year. To be safe, we recommend a continued focus on quality stocks with strong earnings trends.

Stocks rallied on Thursday as investors weighed strong earnings from Meta Platforms and new GDP and employment data. The Commerce Department said that the U.S. economy expanded at a 1.1% rate in 1Q, helped by strong consumer spending but hurt by weak business investment. Meanwhile, employment data pointed to a still tight labor market. First-time claims for state unemployment benefits fell by 16,000 to a seasonally adjusted 230,000 for the week ended April 22, below the consensus forecast of 248,000. Meta shares jumped after strong first-quarter results, reaching their highest levels since January 2022. Amazon also reported stronger-than-expected sales and earnings after the close, sending the shares up in after-hours trading. The Dow rose 1.57%, the S&P 1.96%, and the Nasdaq 2.43%. Crude oil traded near $75 per barrel, while gold rose slightly to $1997 per ounce.

Innovation may be hard to define. But to borrow from former U.S. Supreme Court Justice Potter Stewart, you know it when you see it. The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles to a large degree - have moved overseas, where labor and materials costs are lower. Yet the U.S. economy, even during the pandemic and the current period of high inflation, has expanded to record levels. If U.S. corporations weren't innovating, creating new products (such as vaccines) and services (such as Zoom calls) and moving into new markets and applications, the domestic economy would not be growing, and capital would not be flooding into the country. The current high level of the U.S. dollar relative to currencies around the world attests to the confidence that global investors have in the durable and innovative U.S. economy.

In this edition, Bank of Queensland should generate some interest; China telecom sends out signals of recovery; Want to know who dominates online searching? Google it; and Brookfield Renewable, Kohl's, and Daiichi.

In this edition, Bank of Queensland should generate some interest; China telecom sends out signals of recovery; Want to know who dominates online searching? Google it; and Brookfield Renewable, Kohl's, and Daiichi.

Stocks fell on Monday morning as investors reassessed the outlook for further Fed rate hikes in the wake of the hot January employment report released on Friday. On the earnings front, Tyson Foods fell 4% after the meat producer reported disappointing fiscal 1Q earnings, driven by higher livestock costs and declining margins. Dell Technologies fell more than 3% after announcing the latest in a series of job cuts by major Tech companies. The Dow fell 0.2%, the S&P 0.5%, and the Nasdaq 0.6%. Crude oil traded near $73.50 per barrel, while gold rose $5 to $1881 per ounce.

In this edition, Bank of Queensland should generate some interest; China telecom sends out signals of recovery; Want to know who dominates online searching? Google it; and Brookfield Renewable, Kohl's, and Daiichi.

Monday Tee Up: Inflation and Earning Season Kickoff

Sustainable Impact Investing, or ESG investing, is gaining traction not only with Argus Research clients but also with the global investment community. BlackRock CEO Lawrence Fink, who oversees approximately $9 trillion in assets, announced in January 2020 that his firm would be investing in companies that are making progress on sustainability. He doubled down in his January 2021 letter, calling on company managements to disclose their plans for making their businesses "compatible with a net-zero economy" by 2050. As assets have flowed in over the past 40 years, Sustainable Impact Investing has evolved. The discipline, originally known as Socially Responsible Investing, focused at first on excluding companies that conducted business in South Africa, or participated in industries such as tobacco, alcohol, and firearms. Performance of these initial strategies lagged, and the approach has been modified. Now, instead of merely identifying industries to avoid, the discipline promotes "sustainable" business practices across all industries that can have an "impact" on global issues such as climate, hunger, poverty, disease, shelter, and workers' rights.

Black Friday. Cyber Monday. The retailers are out in force, with a massive marketing push to win consumer dollars during this key holiday shopping season. One dubious gift from 2022 is much lower stock prices. Just like retail merchandise, stocks seemingly are at a big discount right now. But investors must shop with care, focusing, in our opinion, on quality companies with solid finances, proven track records, and strong management teams. This week, we used the Argus Screening Tool to find a list of companies that appear to be low risk, have strong balance sheets, and seemingly represent undervalued opportunities. Specifically, we screened the Argus Universe of Coverage for companies with a BUY rating, a market cap over $8 billion, and with a HIGH financial strength rating from Argus. Then we sorted for those furthest away from their Argus 12-month target price (suggesting a deep discount). The following list is weighted towards Technology -- which is not surprising after the beating the sector has taken so far this year.

Both the potential onset of recession (if the economy is not in one already) and the sharp move higher in interest rates have pulled the foundation out from under the equity market in 2022. Few sectors have been spared, with only the Energy industry in the green on a year-to-date basis. The broad retrenchment has dragged down small-caps, mid-caps, large-caps, and even the mega-caps that had previously pushed stocks to new heights as the economy recovered from the pandemic. In our opinion, some of these world-class companies have been oversold. For our list this week, we have identified 11 BUY-rated large- or mega-cap companies across numerous industries that are selling at attractive valuations and are more than 20% below their 52-week highs.

Innovation may be hard to define. But to borrow from former U.S. Supreme Court Justice Potter Stewart, you know it when you see it. The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles to a large degree - have moved overseas, where labor and materials costs are lower. Yet the U.S. economy, even during the pandemic and the current period of high inflation, has expanded to record levels. If U.S. corporations weren't innovating, creating new products (such as vaccines) and services (such as Zoom calls) and moving into new markets and applications, the domestic economy would not be growing, and capital would not be flooding into the country. The current high level of the U.S. dollar relative to currencies around the world attests to the confidence that global investors have in the innovative U.S. economy.

Earnings Bend but Don't Break as Economy Muddles On

Innovation may be hard to define, but to borrow from former U.S. Supreme Court Justice Potter Stewart, you know it when you see it. The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles, to a large degree - have moved overseas, where costs are lower. Yet the U.S. economy is at its largest point in history and still growing. If U.S. corporations weren't innovating, creating new products and services, and moving into new markets and applications, the domestic economy would be contracting, not expanding, and capital would not be flooding into the country. Particularly at this juncture of the market and economic cycles, when uncertainty is high due to high inflation and rising interest rates, we look for innovative companies to navigate the challenges successfully. At Argus, an 88-year-old independent research firm that has innovated a time or two in its long history, we have focused on four types of innovative companies: Industry Disruptors; First to Market; New Product Specialists; and Product & Process Perfectors. Here are some examples of companies, featured in our Innovation theme model portfolio.

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 Merck & Co Inc (MRK); Fox Corporation (FOXA); Arthur J. Gallagher & Co. (AJG); Target Corp (TGT) and the Focus List deletions are Alphabet Inc (GOOGL); Laboratory Corp. Of America Hl (LH); SVB Financial Group (SIVB); TJX Companies, Inc. (TJX).

Stocks fell on Thursday following further hawkish remarks from Fed officials. Weekly jobless claims were higher than expected at 219,000 claims following the prior week's downwardly revised reading of 190,000 claims. The Labor department will release the September jobs report today. The Dow fell 1.2%, the S&P 1.0%, while the Nasdaq was down 0.7%. Crude oil traded above $88 per barrel, while gold fell $1 to $1719 per ounce.

Second-Quarter Earnings Season: First Look

Sustainable Impact Investing, or ESG investing, is gaining traction not only with Argus Research clients but also with the global investment community. BlackRock CEO Lawrence Fink, who oversees approximately $9 trillion in assets, announced in January 2020 that his firm would be investing in companies that are making progress on sustainability. He doubled down in his January 2021 letter, calling on company managements to disclose their plans for making their businesses "compatible with a net-zero economy" by 2050. As assets have flowed in over the past 40 years, Sustainable Impact Investing has evolved. The discipline, originally known as Socially Responsible Investing, focused at first on excluding companies that conducted business in South Africa, or participated in industries such as tobacco, alcohol, and firearms. Performance of these initial strategies lagged, and the approach has been modified. Now, instead of merely identifying industries to avoid, the discipline promotes "sustainable" business practices across all industries that can have an "impact" on global issues such as climate, hunger, poverty, disease, shelter, and workers' rights.

Stocks rose on Thursday morning amid earnings reports from major technology companies and new GDP data. The Commerce Department said that the U.S. economy contracted at a 1.4% annualized rate in the first quarter, driven mainly by a wider trade deficit, down from 6.9% growth in 4Q and below the Reuters consensus forecast, which called for growth of 1.1%. The Dow rose 0.4%, the S&P 0.8%, and the Nasdaq 0.6%. Crude oil rose nearly 2% to $104 per barrel, while gold fell slightly to $1890 per ounce.

Innovation may be hard to define. But to borrow from former U.S. Supreme Court Justice Potter Stewart, you know it when you see it. The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago - textiles, televisions, even automobiles to a large degree - have moved overseas, where costs are lower. Yet the U.S. economy, even during the pandemic, has expanded to record levels. If U.S. corporations weren't innovating, creating new products (such as vaccines) and services and moving into new markets and applications, the domestic economy would not be growing, and capital would not be flooding into the country. Consider that U.S. GDP was approximately $1 trillion in 1930 but was more than $24 trillion at the end of 2021. That's growth of 24-times. Meanwhile, the U.S. population has grown less than three-times during that time span, to 320 million from 120 million. The delta between GDP growth and population growth has been driven, in large part, by innovation.

Innovation may be hard to define, but (to borrow from former U.S. Supreme Court Justice Potter Stewart) you know it when you see it. The United States economy is full of innovation. It has to be. Manufacturing industries that dominated the economy decades ago -- textiles, televisions, even automobiles, to a large degree -- have moved overseas, where costs are lower. Yet the U.S. economy is at its largest point in history and still growing. If U.S. corporations were not innovating, creating new products and services, and moving into new markets and applications, the domestic economy would be contracting, not expanding. As well, capital would not be flooding into the country. Particularly at this juncture of the market and economic cycles, when uncertainty is high due to the pandemic and upcoming changes to interest rates by the Federal Reserve, we look to innovative companies to navigate the challenges successfully. At Argus, an 88-year-old independent research firm that has innovated a time or two in its long history, we have focused on four types of innovative companies: Industry Disruptors; First to Market; New Product Specialists; and Product & Process Perfectors. Here are some examples of companies that are featured in our Innovation Theme Model Portfolio.

As the stock market has exploded higher since March 14, certain sentiment indicators have flipped back to bullish (as expected). Fortunately, we have not seen any extremely bullish readings from sentiment, which supports the possibility for further upside from stocks.

March has turned into a lion, at least in many markets. Will it go out like a lamb? Hard to say. The major indices rolled over on March 3, with the S&P 500 making a new corrective closing low on March 8 and the Nasdaq and the QQQs making bear market closes on March 14. But over the past six days, the "500" has spiked over 8% while the Nasdaq and the QQQs have soared 12%.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

The stock market broke its string of consecutive losses on Thursday, and with a bang. The S&P 500's intraday low was 4,115 or about 2.6% below Wednesday's close and a loss of 110 points. The Nasdaq 100 (QQQ) intraday low was 3.4% from yesterday's low. Yet the ETF recovered the entire loss within 45 minutes of the opening, and kept the entire market from falling off a cliff. The QQQs fell to almost an initial 38.2% retracement of the rally since the pandemic low, as well as the 100-week EMA and some chart support -- but then took off like a rocket, finishing 3.4% higher.

Stocks fell on Thursday morning, ending several days of recovery after a weak earnings report from Facebook owner Meta Platforms. FB shares dropped 25% after the company reported lower-than-expected 4Q earnings and issued disappointing first-quarter guidance. Other Communication Services stocks also fell sharply, sending the sector down nearly 5%. The Dow fell 0.8%, the S&P 1.4%, and the Nasdaq 2.2%. Crude oil rose to $89 per barrel, while gold fell $3 to $1807 per ounce.

Tuesday was yet another ugly day for the stock market and for January 2022, although the major indices managed to hold above Monday's intraday lows. The S&P 500 gave up 1.2%, the Nasdaq and the Nasdaq 100 (QQQ) got whacked for 2.3%, the S&P MidCap 400 fell 1.8%, and the Russell 2000 (IWM) got smacked by 2.7%. The Dow Industrials lost only 0.2% and the NYSE Composite fell only 0.5%, as both indices continue to hold up better than the rest.

Market breadth took it on the chin during the recent pullback, but has made a decent recovery since bottoming on December 1. We saw nice price follow-through on Wednesday after Tuesday's large gains, and that is a bullish sign. In the S&P 500, 53% of stocks are above their 50-day average (all breadth data as of 12/21 close), up from a fairly oversold 29% on 12/1. Some 68% are above their 200-day, up from 54%. That was the lowest percentage reading of "500" stocks above their 200-day since 11/2020.

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.