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Record-Setting Push Loses Momentum

Stocks shook off coronavirus fears and reached new highs this afternoon, but a late-day slump led to a mostly do-nothing session for the major indices.

The NASDAQ managed the best performance as tech continued its winning ways. The index climbed 0.14% (or nearly 13 points) to 9383.77. The S&P inched upward by less than a point to 3321.75.

The Dow jumped more than 100 points at its height, but lost it all to finish lower by 0.03% (or just under 10 points) to 29,186.27.

It certainly didn’t help that Boeing dipped another 1.4%, a day after slipping more than 3% on news that regulators may not clear the 737 Max until the middle of 2020.

The two big reports from after the bell yesterday went their separate ways on Wednesday. Shares of streaming giant Netflix dropped 3.6% after reporting soft U.S. subscriptions. Investors are mostly concerned about new competition from the likes of Disney, Apple, HBO and NBC… and that’s just in the immediate future!

Meanwhile, IBM jumped 3.4% after a better-than-expected earnings report, which broke its losing streak of five straight revenue declines and included an encouraging guidance.

Today’s big reports were Johnson & Johnson before the bell and Texas Instruments afterward. JNJ slipped about 0.68% after revenue missed estimates, while TXN beat expectations but is still down about 1% afterhours (as of this writing).

Tomorrow’s reports include Procter & Gamble before the bell and Intel after the bell.

The market has started this shortened week under a little bit of pressure. While coronavirus fears had some impact yesterday, the market may just be trying to find some balance after last week’s awesome performance.

Let’s see what the rest of this week has in store for us…

Today's Portfolio Highlights:

Home Run Investor:
The portfolio went back to a past winner on Wednesday by adding Cross Country Healthcare (CCRN), a Zacks Rank #2 (buy) healthcare staffing firm. The company has put together three straight triple-digit surprises and will report again in late February, where the market is expecting revenues of $208 million and EPS of 6 cents. Earnings estimates and the share price both advanced after the last report. Read the full write-up for a lot more on this new addition.

Surprise Trader: The Price, Consensus & EPS Surprise Chart shows that Rexnord (RXN) has gone for at least 20 quarters now without missing the Zacks Consensus Estimate for earnings. That’s a great record! And with a positive Earnings ESP of 1.58% for the quarter coming after the bell next Tuesday, Dave feels pretty good that this process & motion control and water management company is all set to keep that record going. The editor added RXN on Wednesday with a 12.5% allocation. He also sold Pinnacle Financial (PNFP). Read the full write-up for more on today’s moves.

TAZR Trader: Ever get the feeling that it’s just too easy to make money right now? Kevin does, especially with the NASDAQ 100 continually bumping into +7.3% above its 50-day. Sooner or later, the “weak hands will eventually be forced out at these extreme levels”. Therefore, the editor added ProShares UltraPro Short QQQ ETF (SQQQ) on Wednesday. He also sold a third of the CrowdStrike (CRWD) position for a 25.3% return in a little over three weeks. Read the full write-up for more specifics on today’s moves.

Counterstrike: The recent selling in specialty apparel retailer Express (EXPR) was obviously unwarranted, because on Wednesday the stock recovered all its losses... and then some. It reported an impressive preliminary Q4 guidance, including its third straight quarter of same-store sales improvement and the unveiling of a new corporate strategy. Shares soared approximately 20.7%, which easily made EXPR the best performing stock of the day among all ZU portfolios.

Have a Good Evening,
Jim Giaquinto

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