EarningsBeats.com Digest for June 25, 2021
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Historically, There's A Time You Want To Be "All-In"
That time is now. Those of you that know me well know that I'm a student of stock market history. There's an old adage on Wall Street to "buy the rumor and sell the news". That has certainly applied to the stock market's anticipation of earnings season. I wrote a ChartWatchers article about 5 weeks ago titled, "Wall Street Doesn't Want You To See These S&P 500 Performance Numbers". It would do you well to review the numbers presented in this article as it clearly, in my opinion, demonstrates how Wall Street works.
While many of us are inclined to wait to see great quarterly performance before we decide to buy, Wall Street is way ahead of us and profits on us buying in later. How? They buy before the big move in the stock. They meet with management teams and decide to buy or sell long before the news hits the street. My CW article highlights the extraordinary stock market performance leading up to earnings season. Well, you
need to know that not all stocks are created equal. I've recorded every day's performance for every sector ETF and can tell you that pre-earnings advances favor technology (XLK) and consumer discretionary (XLY), which have pre-earnings annualized returns of 45.21% and 45.66%, respectively, during the current secular bull market that began in April 2013 when the S&P 500 finally cleared its double top from highs reached in 2000 and 2007. While all sectors tend to do well heading
into earnings season, the XLK and XLY are clearly the best of the best.
I was a guest host on Wednesday's "Your Daily 5" at StockCharts TV. I featured 5 stocks that I believe will follow their pre-earnings routines and march higher over the next four weeks (and they've already begun). If you'd like to check out this video and see the 5 stocks I featured, CLICK HERE. Please make sure you give me a THUMBS UP!
Happy trading!
Tom Bowley
Chief Market Strategist
EarningsBeats.com
Better Timing. Better Trades.
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