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NASDAQ Now Positive for 2020 After Four Days of Green

The monster run in tech has now pulled the NASDAQ completely out of the hole for 2020.

In other words, the index is barely positive for the year, while its counterparts remain double-digit percentages away from the plus side.

The NASDAQ jumped 1.41% (or about 125 points) on Thursday to 8979.66. (It ended 2019 at 8972.60.)

It’s now on a four-day winning streak with three gains of more than 1% in that time. And it goes into Friday’s session higher by more than 4% for the week.

And we know why this is happening! The FAANGs are all up for the year as well, along with Microsoft (MSFT). Thursday’s biggest winners came from Alphabet (GOOG, +1.9%), Facebook (FB, +1.3%) and Apple (AAPL, +1%).

Meanwhile, the S&P jumped 1.15% today to 2881.19, while the Dow advanced 0.89% (or around 211 points) to 23,875.89.

Stocks again finished off their highs as an earlier runup was sold throughout the day, which has become a pattern this week. Nevertheless, all three of the major indices head into Friday’s session with chances for weekly gains.

But the market will have some big challenges tomorrow before it can claim victory for the week. In addition to the possibility of a normal Friday selloff, we’ll also be getting the government’s monthly employment situation report. And its going to be bad.

Today we learned that 3.17 million more jobless claims were filed last week, which brings the 7-week total now to more than 33 million. And remember that yesterday private payrolls were down over 20 million for April, according to ADP.

So it’s going to be pretty terrible with more than 21 million job losses and an unemployment rate soaring to around 16%.

But at least we know it’s going to be horrible. Plus, the jobless claims number today was the lowest since the pandemic began and the ADP report yesterday was actually better than expected.

Most importantly though, the market has been focused on the future recently as the economy begins to slowly open up.

Stocks shrugged off an alarming jobs report today… so maybe they can do the same tomorrow on hopes that we’re past the worst of this unprecedented situation. 

Today's Portfolio Highlights:

Technology Innovators: Part of ‘fine-tuning’ your portfolio involves taking gains and moving into stocks with a better chance of a post-earnings drift. That's exactly what Brian did on Thursday. He sold Bottomline Technologies (EPAY) for a gain of 18.7% in less than a month. Shares were up today, but the stock recently missed on both the top and bottom lines.

The editor thinks the odds for a drift higher are better from MACOM Tech (MTSI), a Zacks Rank #1 (Strong Buy) provider of power analog semiconductor solutions to varied markets. In addition to beating on both lines, this stock also increased its guidance. Brian likes its history of three beats and one meet in the past four quarters with an average surprise of 88%. And of course, earnings estimates for the quarter and the year are moving sharply higher. Learn more about this fine-tuning in the full write-up. And by the way, this portfolio had one of the best performers of the day as ACM Research (ACMR) jumped 12.4%. 

Insider Trader: Low rental utilization and the auto plant shutdown have wreaked havoc on Ryder (R), as shares of this integrated logistics and transportation services company have dropped over 39% year to date. However, analysts feel that the April/May period should be the low of this crisis and that things could improve afterward. Tracey really likes R’s “juicy” dividend that currently yields 6.9%. But the editor was most impressed with the director who bought 7500 shares of his own company after the earnings report… even though he was also awarded more than 4400 shares on the same day. R was added on Thursday with a 10% allocation. Read the full write-up for more.  

Surprise Trader: The coronavirus outbreak has people scrambling to find healthcare coverage, which explains why Medical – HMOs is in the Top 15% of the Zacks Industry Rank. Dave went to that space for today’s addition by picking up Magellan Health (MGLN). The company beat by nearly 30% in its most recent quarter, and now has an Earnings ESP of almost 40% for the report coming before the bell on Monday. The editor added MGLN on Thursday with a 12.5% allocation, while also taking a 16.5% return in Covenant Transport (CVTI) after the company officially delayed its annual meeting. Read the full write-up for more on all of today’s moves.

Healthcare Innovators: The RNA interference technology platform was a big winner for this portfolio via Alnylam Pharma (ALNY), which was sold last month for a return of over 68%. Now, Kevin is adding a new name that uses the platform to treat rare inherited diseases involving the liver and cancer. The new buy is Dicerna Pharmaceuticals (DRNA), which reports tonight. The editor believes this stock will eventually climb above $25 before any significant pullbacks. Read the complete commentary for more on DRNA, including what some of the big institutions are saying. By the way, the portfolio also sold Intuitive Surgical (ISRG).

Until Tomorrow,
Jim Giaquinto

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