Categories: Smart Money Masters HotlinesStock Market News

Carl Icahn Shines as His Tech Bet Continues to Soar

U.S. and global stock markets closed a mixed week, even as sentiment about the U.S. stock market reached highs not seen in years.

The S&P 500 rose 0.43%, while the Dow Jones powered ahead 1.93%. Both the Nasdaq and the MSCI Emerging Markets Index pulled back, closing the week down 0.7% and 1.08%, respectively.

Your Smart Money Masters portfolio continued to march to the beat of its own drummer.

Carl Icahn’s PayPal Holdings (PYPL) continued to dominate in terms of performance, rising 5.31%. The stock is now up over 72% since my initial recommendation. Raise your stop to $65.30 to lock in at least a 60% gain. Prem Watsa’s bet on BlackBerry (BB) jumped another 4.52%. This position is now up over 50%.

Dan Loeb’s Baxter International (BAX) gained 3.58%. Howard Marks’ Vistra Energy Corp. (VST) gained 3%. Charlie Munger’s favorite stock, Costco (COST), rose 2.47%.

Six of your positions sport double-digit-percentage gains. Kraft Heinz (KHC), Liberty Broadband (LBRDK) and The St. Joe Company (JOE) are still trading below their 50-day moving averages and are currently HOLDs.

Portfolio Update

The U.S. stock market, as measured by the major averages, continues to soar.

As the folks at sentimentrader.com pointed out, last week was the perfect week for the S&P 500.

The S&P 500 hit a record high every day last week. It has also hit a record weekly close for six straight weeks.

Finally, it has hit a record monthly close for seven months. That’s 18 consecutive record closes over daily, weekly and monthly time frames. That has never been seen before in market history.

But there are warning signs.

The rally in the Dow has been incredibly narrow, with a single stock, 3M (MMM), accounting for 54% of its gains on Tuesday.

The S&P’s Relative Strength Index (RSI) has been in overbought territory for three straight weeks, the longest stretch in more than 20 years.

The other times it was so overbought for so long while at a high, it struggled for the next two months.

The bottom line is that cracks are appearing in the sustainability of the U.S. stock market rally. But for now, the trend is your friend.

Sincerely,

Nicholas A. Vardy

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world. He was the Editor of The Global Guru, a free weekly e-newsletter, and also edited the trading services Momentum Trader Alert, which focused on making short-term profits in the hottest markets in the world, and The Alpha Algorithm, which was designed specifically to deliver big, fast triple-digit winners, month after month. He was also the editor of Smart Money Masters, a monthly service focused on longer term investments recommended by the brightest minds in the business. Mr. Vardy has been a regular commentator on CNN International and the Fox Business Network. He has also published articles in The New Republic, The World and I, and The Baker & McKenzie Legal Review. The Global Guru/Nicholas Vardy has been cited in The Wall Street Journal, Newsweek, Fox Business News, CBS MarketWatch, Yahoo! Finance, and MSN Money Central. Mr. Vardy graduated from Stanford with a B.A. — with honors and distinction — in both Economics and History, and he also earned an M.A in Modern European Intellectual History. After winning a Fulbright Scholarship, he earned a J.D. degree at Harvard Law School where he was an editor of the Harvard International Law Journal. When not uncovering investment opportunities for his subscribers and investors, Mr. Vardy is a keep-fit enthusiast and an avid student of classical music.