The Bull Market is Aging Profitably

It’s fitting that the major indices would finish in positive territory on the 8th anniversary of this bull market…even if they did just barely get over breakeven. It was back on March 9, 2009 when the S&P hit its closing low during the Great Recession, since then it has skyrocketed by practically 250%. A decent amount of that gain has come since the election, but we’ve run into a bit of a lull in recent days.

The market is still waiting for specifics on a pro-growth agenda from Washington, and is gearing up for what’s likely to be a long fight to replace Obamacare. More immediately though, the Government Employment Situation report comes out tomorrow morning, and then the Fed meeting takes place next week. There’s very little suspense on either front; the jobs report is expected to be solid and the odds of a rate hike are over 90% right now. The real suspense comes afterward. How will the market react? How many hikes do we get this year? When does President Trump offer some details? Will those details be enough to keep the market happy?

The S&P and Dow had their first positive closes of the week today, and they had to fight hard to get there. In the end, the S&P was only up 0.08% to 2364.9, while the Dow could only muster a 0.01% advance to 20,858.2. The NASDAQ increased 0.01% to 5838.8. Despite the current uncertainties, the economy continues to be strong and the editors believe there is more money to be made in this old yet spry bull market. In the highlights section below, you’ll see that they are still finding stocks with profit potential, while setting up their portfolios for the next stampede higher.

Today's Portfolio Highlights:

Surprise Trader: Yesterday, shares of Carbonite (CARB) jumped nearly 7% on what was otherwise a lackluster session. Eric wasted no time in setting up a sell order for today to lock in a double-digit gain. Therefore, as previously announced, the portfolio sold half of CARB on Thursday for a 10.1% return.

Momentum Trader: The portfolio’s CSII position has run out of steam, so Dave sold it on Thursday and picked up a name that he calls “a consistent trajectory sort of stock”. The editor bought a 12% allocation in Scientific Games (SGMS), a Zacks Rank #2 supplier of instant tickets, systems and services to lotteries. The company has been breaking out all year, so it’s a much better fit for this momentum service than the stalled CSII. Read the complete commentary for SGMS’ chart breakdown and to look at the strong trend lines providing support.

Large-Cap Trader: John was tired of waiting for SABR to bounce off the bottom, so he sold the position to add more shares of Applied Materials (AMAT). The editor first bought this Zacks Rank #1 semiconductor stock earlier this month, and always had plans to add more when opportunities arise. AMAT continues to be in a steady momentum uptrend with an expected EPS growth rate of more than 15.5%. Being in the semi – equipment wafer fabrication space, it is in the top 2% of the Zacks Industry Rank with the 5th position out of 265 industries. Read more about this swap in the full write-up.

Home Run Investor: Lending companies offer some of the best growth potential for 2017. Therefore, Dave bought NewStar Financial (NEWS) today, which focuses on loans and leases to middle market companies. Basically, if small business takes off this year amid pro-growth policies out of Washington, then a company like NEWS would be a major beneficiary. The company is coming off a big earnings beat, and the editor was particularly impressed with its revenue growth of 49.36% and 38.54% over the past two years. Learn more in the full write-up.

All the Best,
Jim Giaquinto

One More Thing...

• Remember, we need your input to make next Wednesday's first Zacks Ultimate Strategy Session the best it can be. There are two ways you can participate:

1) Reity's Mailbag: Steve will answer your questions ranging from current market conditions, general investing wisdom, usage of the Zacks Rank or any resources of Zacks.com and more. Pretty much anything goes.

2) Portfolio Makeover: Steve and Kevin will review a customer portfolio to give feedback for improvement. No need to send us personal information such as dollar value of holdings. Simply email us with all of the tickers you own.

Just make sure to email your submissions for either one, or both, by tomorrow morning, March 10th. Email now to mailbag@zacks.com.

Recommendations from Zacks' Private Portfolios:

Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>

 
Zacks Investment Research