What a crazy week we have in store! Earnings season continues of course, but this time we’ll be getting the numbers from tech giants like Apple, Google and Amazon, among others. These companies have been some of the biggest stars in this epic bull run, so you can bet they will have the market’s full attention.

Furthermore, it’s time for the turn-of-the-month economic data barrage, which includes consumer confidence tomorrow, ADP employment on Wednesday, ISM manufacturing on Thursday and the Employment Situation on Friday just to name a few.

And that’s not all! We’ll also get President Trump’s State of the Union address on Tuesday and Janet Yellen’s last FOMC meeting on Wednesday. With all this potential to move the market on the heels of a fourth straight week of gains for the indices, it makes sense that stocks would take a break on Monday. In fact, when all was said and done, it was one of the sharper drops we’ve seen in a while.

The Dow was off 0.67% (or about 177 points) to 26,439.5, while the S&P slipped by the same percentage to 2853.5. The NASDAQ declined by 0.52% to 7,466.5. On Friday, the indices hit new all-time highs and completed a strong week that saw each one jump by more than 2%.

In the portfolios, Surprise Trader added two names on Monday that report later this week. Healthcare Innovators bought a biotech that’s expected to have a good year and might just be another takeover target. Black Box Trader swapped out three names in its adjustment, including a double-digit winner. Learn more about all these moves and the latest Zacks Confidential in the highlights section below:

Today’s Portfolio Highlights:

Surprise Trader: It’s a busy week for earnings and Dave doesn’t plan to sit on the sidelines. He added two names on Monday: SkyWest (SKYW) and Enova International (ENVA). Both of these companies report on Thursday and have strong Earnings ESPs. SKYW is an airline that has not missed in the last 13 quarters, while ENVA provides online financial services and was called “the most attractive opportunity I’ve seen in weeks” by Dave. He added each with a 12.5% allocation. Read the full write-up for more on these moves.

Healthcare Innovators: Fresh off of banking two huge profits on takeover targets on the same day, Kevin added another company that might be courted by potential acquirers. Exelixis Inc. (EXEL) is a Zacks Rank #1 (Strong Buy) mid-cap biotech focused on cancer treatments. But even if the company isn’t bought, it recently released some good data for a colorectal drug and had its price target hiked by a brokerage firm to $40. Sales for EXEL are expected to grow 39% this year, while profits should advance more than 58%. Read the full write-up for a lot more on this new addition.

Black Box Trader: The portfolio had a double-digit winner this week among the three stocks that were sold:

• Fiat Chrysler (FCAU, +12.9%)
• Dana Inc. (DAN)
• KRB Inc. (KBR)

The new buys that replaced these names are:

• Sysco Corp (SYY)
• CBRE Group (CBG)
• Kemet Corp (KEM)

Read the Black Box Trader’s Guide to learn more about this computer-driven service designed to take the emotion out of investing.

Zacks Confidential: Healthcare has been one of the hottest sectors in the market, and Kevin Cook made a lot of profits in the space since starting Healthcare Innovators back in April 2017. So that raises the question: Are there any opportunities left? The editor says…Absolutely! Kevin Matras agrees, which is why he asked Cooker to head this week’s Zacks Confidential. Learn about the four megatrends driving healthcare profits and get three top picks from the space by clicking: Any Values Left in Healthcare? Yes!

Insider Trader: “The S&P 500 had gone 99 days without a move of 0.5% or more. That was the longest in history. That was broken today. But you know what they say: records are meant to be broken.

“Do I think today’s trade signals some kind of change in the market? Not really.

“We’re going to get a lot of big cap earnings reports this week and they will take the spotlight because I’m expecting them to be fantastic. Fourth quarter earnings season, and the revisions we’re seeing to estimates for Q1 2018, are really something we haven’t seen in the US economy in a long, long time.

“It would be unusual to see a major sell off with the fundamentals this good.” — Tracey Ryniec

All the Best,
Jim Giaquinto
 

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