We all know technology stocks are soaring this year... The tech-heavy Nasdaq Composite Index is up about 35% in 2023. That's a massive eight-month performance.
Editor's note: The markets and our Chaikin Analytics offices will be closed Monday, September 4, for Labor Day. As a result, we won't publish our Chaikin PowerFeed e-letter that day. Expect to receive your next issue on Tuesday, September 5. Enjoy the holiday.
The Second-Best Subsector Should Still Surprise You
By Vic Lederman, editorial director, Chaikin Analytics
We all know technology stocks are soaring this year...
The tech-heavy Nasdaq Composite Index is up about 35% in 2023. That's a massive eight-month performance.
But other parts of the market are doing just as well – if not better...
In fact, the Power Gauge expects an opportunity in one better-performing subsector to continue. And even if you're a regular Chaikin PowerFeed reader, it should surprise you...
The mainstream media would lead you to believe that everything is going against this subsector today. Or at least, it seems like this subsector is facing a huge financial obstacle.
Despite that, this subsector is now No. 2 in terms of the Power Bar ratio – right behind a tech-focused subsector. And not surprisingly, the Power Gauge rates it as "very bullish"...
If you're still in cash, you could be about to miss massive potential gains in one of America's least-known investments this year. It's a chance to make 5 to 10 times your money, from a man who has already uncovered two 10-baggers and booked two 100%-plus gains last year alone. Click here to learn more.
Since 2010, one little-known trading strategy has booked a 94% success rate and is as close to a Holy Grail as anything we've seen. It's a way to target the best companies in the market and instantly collect payouts of $100s at a time, without ever touching a single stock upfront. By tomorrow, click here to learn more (includes a free recommendation).
The second-best subsector in the Power Gauge today is homebuilding. Our one-of-a-kind system measures this subsector using the SPDR S&P Homebuilders Fund (XHB).
Right now, 22 of the 34 rated stocks in XHB are "bullish" or better. And none are "bearish" or worse.
Even better, XHB is in a big uptrend this year. Take a look...
Since the start of 2023, XHB is up about 37%. That's far better than the benchmark S&P 500 Index's roughly 18% gain. And it's slightly ahead of the tech-heavy Nasdaq as well.
You'll also notice that the Power Gauge spotted this trend early...
The system first flashed "bullish" on XHB back in November 2022. And the exchange-traded fund has consistently earned a "bullish" or better rating since last December.
Now, I understand if that surprises you...
You've probably seen in the mainstream media that the 30-year mortgage rate just reached its highest level since 2001. Today, this rate is at roughly 7.2%.
You might think an extreme like that would stall out homebuilders. After all, soaring interest rates make home purchases more expensive.
The median home price in the U.S. is roughly $416,000 today. And at current rates, we're talking about a huge payment spread...
Interest rates were around 2.8% in 2021. Assuming the buyer put roughly 15% down, the monthly payment on the median home would've been around $1,429 back then (before taxes and fees).
Now, the same home would cost a borrower with similar credit $2,383 per month. That's a 67% increase in just two years!
Even though monthly payments are a lot more expensive, housing demand is still high. And the Federal Reserve's preferred measure of new homes (called "months' supply") is falling.
In fact, months' supply peaked in July 2022 at about 10. That means that if everyone stopped building and sales stayed the same, it would take roughly 10 months to exhaust the supply of new homes on the market.
Today, that number has dropped back down to roughly seven months.
Meanwhile, so-called "new housing starts" are also above where they were in July 2022.
That combination tells us the housing market is tightening.
So it might seem crazy at first. But the recipe is simple...
Americans still need homes. And they're still buying despite 30-year-high mortgage rates.
Homebuilders are rushing to meet that demand. And as long as demand holds, we can expect this unusual subsector to keep soaring.
The Power Gauge realizes that. That's why it remains "very bullish" on this opportunity today.
Good investing,
Vic Lederman
Market View
Major Indexes and Notable Sectors
# Hld: Bullish Neutral Bearish
Dow 30
-0.45%
12
15
3
S&P 500
-0.15%
158
243
97
Nasdaq
+0.30%
53
38
8
Small Caps
-0.21%
507
969
458
Bonds
+0.50%
— According to the Chaikin Power Bar, Small Cap stocks and Large Cap stocks are somewhat Bullish. Major indexes are mixed.
* * * *
Industry Focus
Mining Services
8
15
9
Over the past 6 months, the Mining subsector (XME) has underperformed the S&P 500 by -21.34%. Its Power Bar ratio, which measures future potential, is Weak, with more Bearish than Bullish stocks. It is currently ranked #15 of 21 subsectors.
Indicative Stocks
MP
MP Materials Corp.
CDE
Coeur Mining, Inc.
NEM
Newmont Corporation
* * * *
Top Movers
Gainers
WDC
+5.83%
ANET
+4.34%
STX
+3.84%
AVGO
+3.43%
CRM
+2.98%
Losers
DG
-12.15%
PODD
-4.92%
ELV
-3.82%
CHRW
-3.82%
MOH
-3.79%
* * * *
Earnings Report
Reporting Today
Rating
Before Open
After Close
CPRT, DOCU
GWRE
No earnings reporting today.
Earnings Surprises
MDB MongoDB, Inc.
Q2
$0.93
Beat by $0.48
DG Dollar General Corporation
Q2
$2.13
Missed by $-0.33
VMW VMware, Inc.
Q2
$1.83
Beat by $0.11
LULU Lululemon Athletica Inc.
Q2
$2.68
Beat by $0.14
HRL Hormel Foods Corporation
Q3
$0.40
Missed by $-0.01
* * * *
You have received this e-mail as part of your subscription to PowerFeed. If you no longer want to receive e-mails from PowerFeed, click here.
You're receiving this e-mail at diansastroxz.forex@blogger.com.
For questions about your account or to speak with customer service, call +1 (877) 697-6783 (U.S.), 9 a.m. - 5 p.m. Eastern time or e-mail info@chaikinanalytics.com. Please note: The law prohibits us from giving personalized investment advice.
Any brokers mentioned constitute a partial list of available brokers and is for your information only. Chaikin Analytics, LLC, does not recommend or endorse any brokers, dealers, or investment advisors.
Chaikin Analytics forbids its writers from having a financial interest in any security they recommend to our subscribers. All employees of Chaikin Analytics, LLC (and affiliated companies) must wait 24 hours after an investment recommendation is published online – or 72 hours after a direct mail publication is sent – before acting on that recommendation.
This work is based on SEC filings, current events, interviews, corporate press releases, and what we've learned as financial journalists. It may contain errors, and you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility.
Post a Comment
Post a Comment