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Late Rally Gives Dow a 4-Day Win Streak

Stocks took a step back on Thursday after a strong start to this week/month, but the Dow still managed to inch out a gain and extend its winning streak to four days.

The index had been down triple-digits when the final hour began, but finished higher by 0.05% (or just about 12 points) to 26,281.82. It goes into Friday with an approximately 3.5% advance for the week.

The other major indices watched their 4-day winning runs come to an end today. The S&P was down 0.34% to 3112.35, while the NASDAQ was off 0.69% (or about 67 points) to 9615.81.

However, they are also solidly positive for the week, heading into Friday higher by more than 2% and more than 1%, respectively.

Stocks had rallied the past three days on the reopening momentum, which saw money flow into economically-sensitive names like airlines, financials and casinos.

As a result, the Dow has a much better performance this week than the NASDAQ, as big tech no longer needs to hold everything together like it did during the worst of the pandemic selloff.

According to Thursday’s jobless claims report, the economy lost another 1.88 million jobs last week, which brings the total since the shutdown began to more than 42 million.

The result was a bit worse than expectations at nearly 1.78 million, but does continue the downward trajectory of the report in recent weeks. The market is hoping that things will keep improving as more and more of the economy opens up.

And we’re not done with jobs stuff yet, because tomorrow is the employment situation report. It’s expected to be a bit better than last month’s, but that’s not saying much. The employment rate soared to 14.7% last time from the low single digits, and its expected to get to about 20% on Friday.

However, the market has been looking past bad jobs reports for a while, as it has with the protests and increasing tensions with China.

Let’s see if that continues tomorrow so we can boast of three straight weeks of gains…

Today's Portfolio Highlights:

Surprise Trader: Next Monday, Casey’s General Stores (CASY) will be going for its 8th consecutive positive surprise... and Dave thinks it will be successful! This convenience store operator, with more than 2000 locations, has an Earnings ESP of 40.82% for the quarter coming after the bell on June 8. If the company reports $1.44 as the analysts expect, then it would account for earnings growth of more than 111%. The editor added CASY on Thursday with a 12.5% allocation. Meanwhile, a few furniture stocks will be reporting tonight, so Dave decided to sell Williams-Sonoma (WSM) for a positive return of 17.4% in just a little over a week! He doesn’t want to risk such a nice gain. Read the full write-up for more. The portfolio also had the best-performing stock of the day among all ZU services as Navistar (NAV) jumped 12.4% after its quarterly report.

Technology Innovators: The chip names are really strong at the moment, so Brian increased the portfolio’s exposure on Thursday by adding nLight (LASR). This Zacks Rank #2 (Buy) provides high-power semiconductor and fiber laser. It beat earnings estimates by 53% in its most recent report and is now pushing up against a new 52-week high. However, the editor is most excited that LASR looks like it will swing into profitability next year. Meanwhile, shares of Enphase Energy (ENPH) really soared the other week, so the editor decided to go to the bank and sell the stock for a 32.4% return in less than two months. Read the full write-up for more on today’s moves. In other news, GreenSky (GSKY) was one of the day's top performers with an advance of 8.9%.

All the Best,
Jim Giaquinto

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