Stocks Hang On To Modest Gains Amid FBI Raid

Stocks managed a positive session to start off the week, but things were looking a whole lot better earlier in the day.

Reassured by a softer tone on trade from President Trump, the major indices took off right at the open and seemed on their way to a strong finish. Then came news that the President’s lawyer was raided by the FBI. Stocks responded by giving up a lion’s share of the gains.

Each of the indices had advanced by about 2% at their highs of the day but would have to settle for much less by the closing bell. The NASDAQ registered the best performance thanks to a strong showing from tech; it increased 0.51% to 6950.3. The S&P was up 0.33% to 2613.2, while the Dow inched forward by 0.19% to 23,979.1.

So the market has a brand new piece of uncertainty to deal with, which goes along with fears of a trade war, technology pressures and rising rates. But the one thing that we can be certain of is that earnings season is about to start…and the editors can’t wait. It’s expected to be a good one and might help get the market back on a roll if nothing else pops up to derail it.

“It would be nice to move on from Washington headlines and do what we do best in picking stocks, but I think that is a way away. Earnings are coming up quickly, so that could switch focus of market participants. This Friday we will see a handful of financials report, including JPM, WFC and C,” said Jeremy Mullin in Counterstrike.

The Black Box Trader swapped out six positions in this week’s adjustment, and five of the sold stocks were positive. Learn about all the moves in the highlights section below along with some other analysis.

Today's Portfolio Highlights:

Black Box Trader: The portfolio replaced six names this week and five of them were positive. The stocks that left the portfolio today include:

• Archer Daniels (ADM, +3.4%)
• Nordstrom (JWN, +3%)
• Flowers Foods (FLO, +2.7%)
• HD Supply Holdings (HDS, +1.9%)
• Interpublic Group (IPG, +1.8%)
• Hewlett Packard Enterprise (HPE)

The new buys that replaced these stocks are:

• Fiat Chrysler (FCAU)
• AES Corp (AES)
• Anthem Inc. (ANTM)
• HCA Holdings (HCA)
• Supervalu Inc. (SVU)
• Urban Outfitters (URBN)

Read the Black Box Trader’s Guide to learn more about this computer-driven service designed to take the emotion out of investing.

Zacks Confidential: “By far the most exciting real-time revolution unfolding in Biotech right now is CRISPR gene editing,” according to Kevin Cook. In a nutshell, Clustered Regulatory Interspaced Short Palindromic Repeat (CRISPR) uses the power of our DNA to treat diseases. Cook was the most logical choice to bring this therapy to this week’s Zacks Confidential since he finds it “so fascinating that I cannot stop learning or talking about it”. Learn about three CRISPR knowledge areas and a few stocks to consider by clicking: CRISPR Science and Investing.

Surprise Trader: "That was a special sort of day for the market and I don’t mean special in a good way. I suppose then special isn’t even the right word. It was…distressing. We went from having a rally, to having an inside day, so having gains erased. There was no panic buying nor panic selling but rather an orderly accumulation followed by a neat exit.

"The bulls won early, fueled by optimism surround a tweet President Trump made over the weekend. In it, he called Chinese President Xi a friend “no matter what happens with out dispute on trade.” It set off a relief rally that was stopped in its tracks mid-day when news of his lawyer’s office being raided by the FBI.

"If nothing, it made for some great trading. However, if you’re in the swing trading or investing business, then you’re not too excited about it. Despite selling off dramatically into the close the market did manage to hang onto gains, barely." -- Dave Bartosiak, who also manages Momentum Trader and Blockchain Innovators.

All the Best,
Jim Giaquinto

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