U.S. stock markets paused for breath over the past week, with the Dow Jones down 0.05% and the S&P 500 falling 0.54%. Global stock markets continue to disappoint with the MCSI Emerging Markets Index dropping 2.86%.
Big gainers in your Bull Market Alert portfolio included the ever-volatile Trina Solar Limited (TSL), which soared 16.73%, and 3D-printing sensation Stratasys (SSYS), which gained 5.78%. Both Trina Solar Limited (TSL) and iShares MSCI Spain Capped Index (EWP) moved back above their 50-day moving averages. Each is a BUY. Raise your stop in Trina Solar (TSL) to $13.50.
Long-time holding Bank of Ireland (IRE), up 121.69% in 2013, fell below its 50-day moving average and is now a HOLD.
With the Santa Claus rally petering out two days early this season, I am recommending that you reduce your overall exposure to the market.
- Sell your Stratasys (SSYS) Mar 2014 120.00 call options (SSYS140322C00120000) for a 55.69% gain. Raise your stop to $133.10 to lock in at least a 10% gain in the stock.
- Sell your leveraged bet on U.S. small caps through ProShares Ultra Russell2000 (UWM) for a 5.16% gain. Sell your Apr 2014 78.000 call options (UWM140419C00078000) for a 32.06% gain.
- Sell your Google (GOOG) Feb 2014 1080.00 call options (GOOG140222C01080000) to lock in a 28.78% gain. Raise your stop to $1,086.00 to lock in at least 25% gain in the stock.
- Sell both your stock and options positions in Auto Nation (AN) as this stock has broken down technically.
This week’s Bull Market Alert recommendation — Apollo Global Management, LLC (APO) — takes us into one of the stock market’s hottest, but lowest-profile sectors of 2013, “private equity.”
Founded by alumni of leveraged buyout (LBO) investment firm Drexel Burnham and Lambert, Apollo specializes in leveraged buyout transactions and purchases of distressed securities involving corporate restructuring, special situations and industry consolidations.
There is a time for sowing and a time for reaping in private equity. And the combination of low interest rates, a recovering economy and improving investor sentiment is private equity’s day in the sun.
Throughout 2013, Apollo took advantage of red-hot capital markets to cash out on investments throughout the year. As co-founder and Chief Executive Leon Black said in April, “We are selling everything that is not nailed down.”
Apollo’s most notable investments have included Harrah’s Entertainment; Norwegian Cruise Line, the cruise line operator; Century 21; and Sotheby’s International Realty.
So buy Apollo Global Management, LLC (APO) at market to today, and place your stop at $28.00. If you want to play the options, I recommend the March $32.50 calls (APO140322C00032500).
Disclosure: This is a position I hold both personally and on behalf of my clients at my firm Global Guru Capital.
Portfolio Update
Bank of Ireland (IRE) fell 2.60% last week to close out 2013 with a 121.69% gain. Among the 38 top global stock markets I monitor, Ireland finished 2013 in the number one spot. Although it remained above the solid $14.00 support level, IRE dipped below the 50-day moving average (MA) and is now a HOLD.
Google Inc. (GOOG) lost 1.20%, after hitting a new 52-week high earlier in the week. 2013 was a banner year for Google’s influence in key hardware markets, as Google’s laptop-like Chromebooks soared from a 0.2% share to a 10% market share. More broadly, Android tablet sales doubled in 2013, moving from 4% to 9% of 2013 units sold, even as sales of both Windows and Apple-based rivals fell during the same period. GOOG will report earnings on Jan. 30, after markets close. GOOG is a BUY.
iShares MSCI Spain Capped Index (EWP) lost 2.38% over the past four trading days. European Purchasing Managers Index (PMI) data came out last Thursday and showed a rise for December 2013. EWP also moved above the 50-day MA during the holiday week and is now a BUY.
Trina Solar Limited (TSL) jumped another 16.73% last week. TSL is gaining ground fast as the Chinese solar panel manufacturer has soared 38% since bottoming last month on the back of recent positive news in the solar sector. This volatile bet on solar power moved back above the 50-day MA last week to become a BUY. Raise your stop in this roller-coaster ride of a stock to $13.50.
Stratasys (SSYS) gained 5.78% last week, the third straight week of robust gains. The colossal annual Consumer Electronic Show (CES) kicks off next week in Las Vegas, Nev., and you can expect 3D-printing technology to be highlighted front-and-center. CES is all about “tomorrow’s technology” and news-related buzz, a custom-made combination that may push 3D-printing stocks higher. SSYS is a BUY.
db X-trackers Harvest China ETF (ASHR) dipped 1.15% last week. ASHR is your investment ticket to the Chinese companies that the Chinese government has picked as “winners.” Typically closed to outside investment, ASHR brings you into an investment arena off limits to most. ASHR is a BUY.
Apple Inc. (AAPL) fell 3.41% last week. Apple gave back some ground last week due to an analyst’s downgrade. However, with one billion Chinese folks in need of a shiny new iPhone, the long-term outlook for AAPL remains positive. AAPL is back to the $540 support level and its 50-day MA, a price level it held just two weeks ago, should give investors a confident point to begin buying once again. AAPL is a BUY.
Latest Special Report
As a courtesy, I want to bring to your attention my latest special report, the newly updated version of The Top 12 Stocks You Should Buy Right Now, which features three of my top investment recommendations, as well as bonus picks from each of my fellow investment newsletter editors at Eagle.
