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Afternoon Note

Bearing Fruit

By Charles Payne, CEO & Principal Analyst
2/15/2019 1:34 PM
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Don’t look now but the ART OF THE DEAL is beginning to bear fruit as President Trump signs a bi-partisan spending bill that puts $1.37 billion toward border wall funding and averts a government shutdown.   Meanwhile, by all accounts (except NY Times), the U.S. - China negotiations in Beijing went well, and hasten meetings next week in Washington D.C.

The stock market loves these developments, which also allow investors to focus on fundamentals and valuations.

Don’t look now, but the Dow Jones Industrial Average and S&P 500 are in the shadows of their all-time highs achieved last year.

This seems very sudden, and it’s very exciting.  There have been some decisive winners and losers in certain industries:

But the real story is this rally has been like a block party, and just about every stock is rocking.

This is distinctly different than the 2017 - 2018 rally that was essentially carried by a half dozen companies.  Even at the high point of last year, there were more losers than winners on the S&P 500.

The 2019 Rally Highlights:

The biggest winners were among 2018 biggest losers:

Even today’s monster rally is being led by financials, which in turn are higher on earnings from Moody’s (MCO).  I have been asking this question since last year, if the market could rally without the leadership of big tech and momentum names. 

The answer thus far has been a resounding yes.  But will investors be able to throw darts and hit winners for the reminder of the year?  The answer is no.  There were a lot of extremely oversold stocks coming into the New Year.

Initial bounces while providing amazing gains could be limited. 

S&P 500 Index


Communication Services (XLC)


Consumer Discretionary (XLY)


Consumer Staples (XLP)


Energy (XLE)


Financials (XLF)


Health Care (XLV)


Industrials (XLI)


Materials (XLB)


Real Estate (XLRE)


Technology (XLK)


Utilities (XLU)


Have a great holiday weekend.

Let's face facts, Trump lost on the border wall funding... You can chalk it up to inexperience, Nancy out played him... But too much time and effort was spent on trying to bring Nancy et al around, and all that attention only made for a public humiliation... Nancy & company are out to destroy President Trump and they will not side with him on any thing, he could have dealt with this a little more forcefully and less public participation...

Andrew B Newallo on 2/15/2019 6:02:06 PM
I do not agree with Trump being outplayed, because the game is not yet over. Donald Trump knows just what he is doing. Do not be surprised if he has Big League results. Just wait!! By the way Pelosi and Schumer need to resign, they look like servants of evil. Hard to look at.

sally baumann on 2/17/2019 11:47:33 AM
No, Trump has won again! Nancy and Chuckie must go! They are the problem along with others who are not Patriots...but just collecting a check....they should all be jailed !

Mike Mitchell on 2/19/2019 11:46:42 AM

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