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NASDAQ Hits New Record Despite Slow Session

If the market’s going to run in place, then it might as well do it around all-time highs!

We saw another quiet session for stocks on Tuesday as earnings season wanes and the trade deal remains up in the air.

However, the indices still mostly moved higher with one of them reaching a new record.

The NASDAQ closed at a fresh high by climbing 0.26% (or nearly 22 points) to 8486.09. The S&P advanced as well, but was just shy of a new record by advancing only 0.16% to 3091.84. The index did momentarily eclipse 3100.

The Dow was breakeven… and that’s with no rounding. The index was completely unchanged at 27,691.49. So it’s still at a record high, but didn’t make a new one.

Apparently, investors were expecting something significant in President Trump’s speech at the Economic Club of New York today. It was pretty much the only chance for a real catalyst today.

He did say that a Phase 1 deal could be signed soon, along with a lot of other stuff we’ve heard before.

But there was really nothing new and the major indices gave up all their gains before moving higher late in the session.

Another big story on Tuesday was the long-awaited launch of the Disney+ streaming service. Early subscribers reported technical problems and glitches on its first day, but there’s nothing surprising about a few bugs right at the start.

Shares of the entertainment powerhouse still climbed 1.35%, providing the market with some positive news on an otherwise lackluster session.

The market is still feeling pretty good and is comfortable hanging around all-time highs. But its going to need some reason to move higher from here, and that might be tougher now that earnings season is nearing an end.

This would be a great time for that Phase 1 deal! 

Today's Portfolio Highlights:

Counterstrike: The 737 Max drama at Boeing (BA) may have finally turned the corner, as the aerospace & defense giant announced yesterday that the jet could be ready for service as soon as January. Therefore, it might be time for the stock to start recovering the more than 100 points it lost since its 2018 highs. Jeremy sees BA at an attractive price, so he added it on Tuesday with a 10% allocation before the inevitable move higher. The editor also bought a 5% allocation in Zacks Rank #2 (Buy) Mexican food chain Chipotle (CMG), which has pulled back after nearly doubling this year. As with BA, Jeremy is getting in before the rebound. Read the full write-up for more on today’s moves. 

Options Trader: Just last week, shares of (JD) finally broke out to the upside after being in a sideways basing pattern for most of the year. This Chinese online direct sales company reports before the market opens on Friday and Kevin thinks this breakout will continue if it has a solid report. Therefore, the editor added a few bull call spreads in JD by buying to open 4 March 33.00 Calls AND selling to open 4 March 38.00 Calls. If this Zacks Rank #2 (Buy) can get to $38 by the mid-February expiration, then the portfolio will gain 163%. The full write-up has more specifics on today’s action.

Healthcare Innovators: A solid quarterly update appears to have put a bottom in for Intellia Therapeutics (NTLA) near $11. Therefore, Kevin decided to get back into this Zacks Rank #2 (Buy) early stage drug development company, which focuses on CRISPR/Cas9 gene editing technology. You may remember the portfolio had this name last year, but had to get out during the sharp December selloff. These days, the visibility for its pipeline is clearer and the risk/reward is favorable. The editor thinks NTLA has pipeline assets that are strong enough to double the stock in time. The portfolio also got out of the underperforming GW Pharmaceuticals (GWPH). Read the full write-up for a lot more on these moves.

Surprise Trader:
The portfolio is betting that Twin River Worldwide (TRWH) will beat expectations when it reports after the bell on Thursday. This Zacks Rank #2 (Buy) casino company has a positive Earnings ESP of 13.25% for the quarter, so Dave added TRWH today with a 12.5% allocation. The editor also sold the disappointing Core-Mark (CORE) position. Read the complete commentary for more on today’s moves. 

TAZR Trader: With the market avoiding a pullback, software finds itself pushing to levels not seen since July. This was a good backdrop for Kevin to add more to his Elastic (ESTC) position, especially since the big data analytics provider received another bullish initiation of coverage. This stock was originally added in early September after a strong quarterly report and is expected to grow sales 51% for the fiscal year ending in April. The editor also sold ProShares UltraPro Short Dow 30 (SDOW) and Proshares UltraPro Short QQQ (SQQQ) now that the potential for a pullback has diminished. Read the full write-up for more, including Kevin’s bull vs. bear battle on software.

Zacks Short List: The portfolio is swapping out three positions in this week’s adjustment. The following stocks left the portfolio today after being short-covered:

• InterXion Holding (INXN, +5.1%)
• Weyerhaeuser (WY, +2.4%)
• Baidu (BIDU)

The new buys that replaced these names are:

• Huazhu Group (HTHT)
• Wynn Resorts (WYNN)
• Yelp (YELP)  

Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short List Trader Guide.

Have a Great Evening,
Jim Giaquinto

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