After four consecutive alarmingly high Nasdaq One-Week Sell/Buy Ratios, data from Vickers Stock Research this week brings a calmer reading. Still, at 3.37, the Nasdaq ratio remains higher than the NYSE ratio at 2.91, this on a scale where readings above 2.50 are bearish. Nevertheless, this data this week represents a sharp decline from the readings in recent weeks, when the Nasdaq One-Week Sell/Buy Ratio reached a peak of 9.80 in the week of January 22, making the current weekly reading the lowest (least glaringly bearish) result since late December.

Stocks were mixed on Friday morning following strong earnings from Amazon and generally positive inflation data. The Commerce Department said that its personal consumption expenditures price index, or PCE, rose 3.4% from the prior year in September, in line with the revised reading for August and the Bloomberg consensus forecast. Excluding food and energy prices, the core PCE, the Fed's preferred measure of inflation, rose 3.7%, down slightly from 3.8% in August and also in line with consensus. The Dow fell 0.4%, the S&P rose 0.2%, and the Nasdaq rose 1.1%. Crude oil rose to $84 per barrel, while gold fell $5 to $1992 per ounce.

Stocks declined on Wednesday morning on rising oil prices as fears that persistent inflation will keep the rates higher. The ISM non-manufacturing Purchasing Managers' Index (PMI) came in at 54.5, compared with expectations of 52.5. In other news, Apple fell after a report that China has banned government officials from using iPhones for work. The S&P 500 fell 0.8%, the Dow 0.6% and the Nasdaq was down 1%. Crude oil traded near $87 per barrel and gold fell $11 to $1941.

Stocks declined on Wednesday morning on rising oil prices as fears that persistent inflation will keep the rates higher. The ISM non-manufacturing Purchasing Managers' Index (PMI) came in at 54.5, compared with expectations of 52.5. In other news, Apple fell after a report that China has banned government officials from using iPhones for work. The S&P 500 fell 0.8%, the Dow 0.6% and the Nasdaq was down 1%. Crude oil traded near $87 per barrel and gold fell $11 to $1941.

Stocks rose on Thursday morning following generally positive inflation data. The Labor Department said that its all-items consumer price index rose 3.2% on a year-over-year basis in July, up from a 3.0% increase in June but below the consensus forecast of 3.3%. Excluding food and energy prices, the core CPI rose 4.7% from the prior year, down from 4.8% in June. On the earnings front, Disney shares rose, despite disappointing fiscal 3Q sales and subscriber numbers, as the company topped the consensus EPS estimate and said that it would resume dividend payments by the end of the year. The Dow rose 0.9%, the S&P 0.9%, and the Nasdaq 1.0%. Crude oil fell 1% to $83.50 per barrel, while gold fell slightly to $1949 per ounce.

We all have to live somewhere. Housing always is a topic of conversation, especially now, with interest rates elevated and more uncertainty ahead. Many economists opine on the state of the housing market but the bottom line is that the supply of homes is low and demand is high. Those homeowners with low interest rates want to keep them and don't want to move. The S&P Homebuilders Index is up 32% year-to-date, outperforming the broader S&P 500 index (which is up 16%). We see more runway for the homebuilders as the shortage of homes is not a short-term event. The lack of affordable housing comes from 10 years of underproduction, according to the National Association of Home Builders. The NAHB puts the deficit at 1.5 million residences as of February 2023. The association calls the lack of affordable housing a "crisis." Also, there currently are about 75 million Baby Boomers trying to age in place while 77 million Millennials are hitting the home-buying age. For sure, the spike in mortgage rates is hurting affordability. During this past 10-year period, we saw 30-year fixed-mortgage rates fluctuate very little, between a band of between 2%-5%. That has changed drastically in the past two years, as 30-year fixed-mortgage rates have skyrocketed from 2.7% in July 2021 to 6.7% in July 2023. Rents have remained high as well, making that option unattractive and keeping interest in owning homes high. Also, the jobs market has been strong, so consumers can afford to place a down payment. Given the current housing environment, here are some Argus Research BUY-rated stocks that we believe represent opportunities to invest in the housing sector.

It would be presumptuous for us to raise a red flag and say with a high degree of confidence that the recent rally is over and that we are headed for a 10% (or more) correction. But there have been signs in recent weeks that the market needs to take a break, this after stocks have pushed aggressively higher. As such, we believe a 3% to 6% pullback is in the offing (depending on the index), with the S&P 500 getting hit the least, and the Nasdaq and Nasdaq 100 (NDX) getting hurt the most.

The first-quarter earnings season is wrapping up, with blended earnings (actual results and the consensus for those still to report) showing a 0.6% year-over-year decline, according to Refinitiv. That is considerably better than the 5.0% decline expected at the start of the earnings period, though still not enough to avoid a technical earnings recession following 4Q's 3.4% decline. Propelling the 1Q outperformance was a 74% beat rate (versus the long-term average of 62%), with strong gains in Consumer Discretionary (+55%) and Industrials (+26%), but drags from Basic Materials and Utilities (both -22%). Our analysts are always on the lookout for companies that boost their outlooks during earnings season. Management's ability to "raise guidance" can often be a catalyst for market-beating returns in the quarters ahead. Here is an initial list of BUY-rated companies in Argus Coverage for which management has raised guidance or increased its outlook during the 1Q23 EPS reporting season.

We recently read two statements that pretty much say it all. The first was this. 'Positive earnings surprises of this magnitude are rarely seen when you enter a recession.' That compared to this. 'Forecasted probability of recession at levels only seen during recessions.' Yes, these are confusing times.

Stocks fluctuated in volatile trading on Friday morning as investors weighed a new round of earnings reports and monthly consumer sentiment data. The University of Michigan said that its preliminary consumer sentiment index for February rose to 66.4, up from 64.9 in January and above the Reuters consensus forecast of 65.0. However, the inflation expectations reading was higher. The February survey reported that consumers expected prices to rise 4.2% over the next year, up from 3.9% in January. The Dow rose 0.4%, the S&P rose 0.1%, and the Nasdaq fell 0.7%. Crude oil rose 2% to $79.50 per barrel, while gold fell $6 to $1872 per ounce.

Rapidly rising inflation 2022 knocked stocks into a bear market. While growth strategies suffered the most, value strategies also declined. Even bond prices were lower last year. Volatility, which has dropped from the highs of 2020, still has not returned to pre-COVID levels. Is it time for investors to cash in their chips? We note that investors exit the stock market at their own peril, as long-term returns from equities consistently have outpaced long-term returns from other asset classes, such as fixed income and cash. As well, those fixed-income returns are from eras when the 10-year Treasury bond yield was much higher than the current 3.5% level. So what's a potential equity strategy for investors amid all the uncertainty? Argus believes that Min Vol is an all-weather strategy that is timely in any investing climate.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

The housing industry was an important contributor to the U.S. economic recovery from the pandemic, but recent high prices and high interest rates have cooled the market. The National Association of Realtors recently reported that existing home sales in October 2022 totaled 4.4 million at a seasonally adjusted annual rate, down 32% from the rate at the beginning of the year. The Commerce Department reported that new one-family homes were selling at a 632,000/year pace in October -- down from 831,000 in January. Meanwhile, a leading indicator for the industry, housing permits, has turned lower as well. According to the Census Bureau, permits were being authorized in October at a 1.5 million annual rate, down from 1.9 million in March. Housing prices are finally starting to cool. The S&P/Case-Shiller National Home Price Index for September 2022 showed that the average price has risen "only" 10% year-over-year -- and is down 3% from the peak in June. The high prices and high mortgage rates (the average rate on a 30-year fixed-rate mortgage was recently 6.33%) have boosted housing inventories. According to the U.S. Census Bureau there currently is an 8.9-month supply of existing homes for sale (the typical range is 4.5-7.5 months). Until pricing pressures ease further, we do not believe that the housing sector will be supportive of U.S. economic growth.

Stocks rose on Tuesday morning following more signs of cooling inflation. The Labor Department said that its producer price index rose 8.0% from the prior year in October, down from 8.4% growth in September and below the Bloomberg consensus forecast of 8.3%. On the earnings front, Walmart and Home Depot both rose after reporting better-than-expected sales and earnings. The Dow rose 0.7%, the S&P 1.3%, and the Nasdaq 2.2%. Crude oil fell slightly to $85 per barrel, while gold fell $2 to $1775 per ounce.

The broad market selloff on September 13 still feels raw, and the Federal Reserve has left no doubt that it will fight inflation vigorously for as long as it takes. Stocks, and likely many portfolios, are feeling some pain. In volatile times like these, when selling is widespread, a classic investing strategy is to focus on “best in class” stocks. These are the strongest and most-stable stocks in each sector -- and by looking across sectors, diversification can also be achieved. To get our list this week, we ran multiple screens. We started with the Argus Min-Vol theme model portfolio. As the name suggests, that portfolio includes companies that likely can best withstand market fluctuations. We then shortlisted the group by also screening for financial strength and dividend yield. And, finally, we picked one stock from each of the 11 S&P sectors. The following stocks are our Best in Class for Safety recommendations for September 2022, and all of them currently carry an Argus BUY rating.

Monday Tee-Up: No Summer Doldrums on Wall Street

Rapidly rising inflation in 2022 has knocked the stock market into a bear market. While growth strategies have suffered the most, value strategies also have declined. Even year-to-date bond prices are lower. Volatility, which has dropped from the highs of 2020, still has not returned to pre-COVID levels. Is it time for investors to cash in their chips? We note that investors exit the stock market at their own peril, as long-term returns from equities consistently have outpaced long-term returns from other asset classes, such as fixed income and cash. As well, those returns are from eras when the 10-year Treasury bond yield was much higher than the current 3.0% level. So what's a potential equity strategy for investors amid all the uncertainty? Argus believes that Min Vol is an all-weather strategy that is timely in any investing climate. Academic literature and, more to the point, returns history, indicate that Min Vol can deliver market-matching returns on an absolute basis and superior returns on a risk-adjusted basis over various time periods.

Rapidly rising inflation in 2022 has knocked the stock market into a bear market. While growth strategies have suffered the most, value strategies also have declined. Even bond prices are lower year-to-date. Volatility, which has dropped from the highs of 2020, still has not returned to pre-COVID levels. Is it time for investors to cash in their chips? Perhaps not yet. We note that investors exit the stock market at their own peril, as long-term returns from equities consistently have outpaced long-term returns from other asset classes, such as fixed income and cash. As well, those returns are from eras when the 10-year Treasury bond yield was much higher than the current 3.0% level. So what's a potential equity strategy for investors amid all the uncertainty? Argus believes that Min-Vol is an all-weather strategy that is timely in any investing climate. Academic literature and, more to the point, returns history indicate that Min-Vol can deliver market-matching returns on an absolute basis and superior returns on a risk-adjusted basis over various time periods. We have designed a portfolio of companies followed by Argus Research analysts that are BUY-rated and have impressive Min-Vol characteristics of low beta, high yield, high market cap, strong balance sheets, and low risk profiles. Some of the stocks featured in the portfolio are listed below.

Rapidly rising inflation in 2022 has knocked the stock market into a bear market. While growth strategies have suffered the most, value strategies also have declined. Even bond prices are lower year-to-date. Volatility, which has dropped from the highs of 2020, still has not returned to pre-COVID levels. Is it time for investors to cash in their chips? We note that investors exit the stock market at their own peril, as long-term returns from equities consistently have outpaced long-term returns from other asset classes such as fixed income and cash. As well, those returns are from eras when the 10-year Treasury bond yield was much higher than the current 3.0% level. So what's a potential equity strategy for investors amid all the uncertainty? Argus believes that Min Vol is an all-weather strategy that is timely in any investing climate. Academic literature and, more to the point, returns history indicate that Min Vol can deliver market-matching returns on an absolute basis and superior returns on a risk-adjusted basis over various time periods. Argus has developed a sophisticated approach to Min Vol investing built around our proprietary quality and safety screens.

Stocks fell sharply on Friday morning, reversing much of Thursday's rally. Amazon shares dropped more than 12% after the company posted a first-quarter loss and issued disappointing guidance for the current quarter. Apple shares also fell, despite strong fiscal 2Q results, after the company warned that supply-chain constraints would weigh on revenue in 3Q. The Dow fell 1.2%, the S&P 1.8%, and the Nasdaq 2.1%. Crude oil rose to $108 per barrel, while gold traded near $1915 per ounce.

We are lowering our intermediate-term (I.T.) technical outlook to bearish from neutral. Most of the major stocks (top 10) in the S&P 500 and the QQQs are on I.T sell signals. Other than the AAII, we haven't seen another big pickup in bearish sentiment -- even though there is a lot of bearish commentary by professionals out there. Breadth remains an issue, as the percentage of stocks in the major indices that are trading above their 200-day average is at 60% or below. Leadership remains an issue with energy-related and defensive sectors leading this year. Yields have gone further than expected across the entire curve, but are almost certainly due for a pullback.

Generally, the stock market gives us a few warnings before we see the end of a cyclical and secular bull. The 1982 to 2000 secular bull market saw two cracks before the top, with the S&P 500 falling 22% in 1998 and 13% in August 1999. While the Nasdaq topped in March 2000, the S&P 500 made its final high in August 2000. During the cyclical bull market from 2003 until 2007, the "500" dropped 8% in June 2006 and 7% in March 2007. In July and August, the index fell almost 12% on an intraday basis before finally peaking in October 2007.

The stock market returned to its bearish ways last week, as the January CPI posted its highest annual increase in 40 years and the 10-year Treasury yield pushed up almost to 2%. On Friday, the Dow Jones Industrial Average dropped 504 points, or 1.43%. The S&P 500 fell 1.90%, and the Nasdaq Composite plunged 2.78%. For the week, the DJIA was down 351 points, or 1.00%, the S&P 500 was down 1.82%, and the Nasdaq Composite was off by 2.18%. Year-to-date, the Dow is down 4.40%; the S&P 500 is off 7.29%; and the Nasdaq Composite is back in correction territory, down 11.85%.

Market breadth has improved a bit after the deterioration that happened in January. On the S&P 500, 43% of stocks are above their 50-day average, up from 28% on January 27 (all breadth data as of 2/1 close). Some 55% of stocks are above their 200-day, up from 28% last week. The recent low reading was the weakest since October 2020. Generally, major market declines happen when this measure falls below 45%.

There's been some odd price and internal action of late, and more and more of what we are seeing is leaning toward the technically bearish side. Last week, we had three strong breadth days (80% days) that usually lead to strong gains over the next six to 12 months. This occurred right after two weak days, which makes the signal all the more bullish. We also saw strong insider buying from Vickers Stock Research.

The volume of insider transactions has risen to the highest level since March, with over 2,100 insider trades last week that met the criteria for inclusion in Vickers' Weekly Insider report. Below, we dive deeper into the trading activity.

The volume of insider transactions has risen to the highest level since March, with over 2,100 insider trades last week that met the criteria for inclusion in Vickers' Weekly Insider report. Below, we dive deeper into the trading activity.

In August, we said that a crude oil (WTI) breakout over $70 would complete a bullish inverse head-and-shoulders (H&S) pattern and open up several scenarios, with the most-common 100% extension targeting $78, or just above the highs from early July. With the strong gain of 2.3% on Monday, WTI hit an intraday high $78.38, and closed at $77.63.

The SPDR Gold Shares (GLD, $166.61) remains in a downward channel that started in early June. GLD remains under its 50- and 200-day moving averages as well as its 43-week exponential average. Trendline resistance sits up near $169, with the 200-day average at $170. Key chart support remains down at $157 or the lows from March. Longer term, GLD has been in a downtrend since peaking in August 2020 and is 13% below that high.

Stocks rose on Thursday morning following new weekly employment data. The Labor Department said that first-time claims for state unemployment benefits fell to 385,000 for the week ended July 31, down from 399,000 a week earlier but slightly above the Bloomberg consensus of 383,000. The Commerce Department reported that the U.S. trade deficit rose 6.7% to a record $75.7 billion in June, driven by a sharp increase in imports. The consensus forecast was $74.1 billion. The Dow rose 0.6%, the S&P 0.5%, and the Nasdaq 0.6%. Crude oil rose to $69 per barrel, while gold traded near $1805 per ounce.

Monday was an all-around tough day for the stock market, with the S&P 500 falling 1.6%, the Nasdaq giving up 1.1%, the Nasdaq 100 (QQQ) losing 0.8%, the S&P 400 MidCap off by 1.7%, and the Russell 2000 (IWM) down by 1.5%. NYSE breadth was terrible at -2,350 as there were few, if any, places to hide. Only about 45 S&P 500 stocks rose on the day. Even so, the index is only 2.9% below its July 12 all-time high.

This edition features moat sources in medtech; American cannabis; what eliminating the 1031 would mean for REITs; and notes from newly wide-moat Nvidia and new coverage Sofi and Spirax-Sarco.

So it seems the fed funds rate won't stay at 0% for eternity. Presumably, most people in the investment business knew that the Federal Reserve would start to take its foot off the gas eventually and slow massive monetary accommodation. So we are surprised the markets did not see this coming. Is it possible to look at the monthly economic and inflation statistics, but then ignore everything and wait until the Federal Reserve serves up news on a platter prior to announcing any change in policy? In our opinion, even the short end of the yield curve missed this, as there has been very little upward pressure on short yields.

Inflation has bared its fangs this month, with multi-year high readings in the consumer price index and the producer price index. The housing sector, the bulwark of the economy during the worst of the pandemic, came crashing down this past week according to data for new home starts; rising rates, higher materials prices, and in particular, higher home prices are all crimping demand. Crypto got crushed last week, and not just because of the latest tweet from Elon Musk.

Stocks fell again on Wednesday morning amid continued inflation fears, as the 10-year Treasury yield rose to 1.68% and U.S. consumer prices rose at their highest rate in nearly 12 years. The Labor Department reported that its consumer price index rose 0.8% in April, up from 0.6% in March and well above the Reuters consensus forecast of 0.2% growth. The CPI also rose 4.2% from the prior year, up from a 2.6% increase in March. The Dow fell 0.9%, the S&P 1.2%, and the Nasdaq 2.0%. Crude oil traded near $66 per barrel, while gold fell $4 to $1832 per ounce.

This edition features our U.S. housing outlook; smarter hydrogen investing; Swatch's prospects in a pricey luxury market; and notes from Johnson & Johnson, Schwab, and AMD.

Stocks were mostly higher on Thursday morning, led by the Technology sector, following new employment data. The Labor Department said that first-time claims for state unemployment benefits fell to 793,000 for the week ended February 6, down from a revised 812,000 a week earlier but above the Bloomberg consensus forecast of 760,000. The Dow was flat, the S&P rose 0.1%, and the Nasdaq rose 0.4%. Crude oil fell slightly to $58.50 per barrel, while gold traded near $1838 per ounce.

Stocks were mostly higher on Thursday morning, led by the Technology sector, following new employment data. The Labor Department said that first-time claims for state unemployment benefits fell to 793,000 for the week ended February 6, down from a revised 812,000 a week earlier but above the Bloomberg consensus forecast of 760,000. The Dow was flat, the S&P rose 0.1%, and the Nasdaq rose 0.4%. Crude oil fell slightly to $58.50 per barrel, while gold traded near $1838 per ounce.

Stocks snapped back during election week, as the vote count dragged into the weekend. The Republicans likely hold onto the Senate, which means no big tax hikes; and Vice President Biden claims the White House, which means the Affordable Care Act stays. Based on the strong stock market, investors cheered for gridlock. On Friday, the Dow Jones Industrial Average fell 67 points, or 0.2%. The S&P 500 dropped a single point, and the Nasdaq Composite edged up four points. For the full week, the Dow was up 6.9%, reversing the prior week's 6.5% loss. The S&P 500 was up 7.3%, and the Nasdaq was up 9.4%. For the year-to-date, the DJIA is down less than 1%, the S&P is up 8.6%, and the Nasdaq is up 38.5%. Over the past 52 weeks, the Dow is up 2.3%, the S&P 500 is up 13.5%, and the Nasdaq is up 40.4%.

The market has generally skidded lower over trading days spanning two weeks. Is this a healthy correction of an overbought market, or a sign of further market distress to come? We won't know right away -- but, so far, the stock market mainly has unwound much of its August run-up.