Reminder: Sabrient is available to chat with Members, comments are found below each post.
Courtesy of Scott Martindale, Senior Managing Director, Sabrient
As the market has rallied over the past two days, Technology and Energy have been leaders. Apple (AAPL) gave a stellar earnings report and hit another record high. IBM (IBM) also chipped in this week with a great report. However, Yahoo! (YHOO), Riverbed Technology (RVBD), F5 Networks (FFIV), and Fortinet (FTNT) were less than stellar in the Tech sector and served as a drag on the market today to offset the “Apple effect.” Financial has showed some life over the past couple of days, as well, and is trying to get in the game, despite the poor performance so far this year of the big banks. And just like the good old days of the late 1990’s, Internet-oriented IPOs are again the rage, as Zillow (Z) joined the party today with a huge showing.
But the big story is Apple. This amazing company once again has shown us why it is such a market leader in so many ways, e.g., innovation, branding, service, customer loyalty, value…and of course, stock performance. Sabrient continues to carry a Strong Buy rating on it, with a perfect Growth Score of 100. Apple more than doubled earnings on a huge revenue increase and higher gross margins. After closing Tuesday at $376.85, price jumped afterhours on the news to above $400, and today it settled at $386.90. It is now up about 20% year to date. Goldman Sachs immediately upped its 12-month price projection to $525. Suddenly, AAPL is not only a growth stock but maybe a value stock as well.
Another market catalyst this week is the “Gang of Six” Senators, led by Democrat Mark Warner and Republican Saxby Chambliss, who have proposed a bi-partisan debt reduction proposal to address the imminent debt ceiling problem. It seems to be getting some traction.
The combined impact of strong corporate earnings and the Gang of Six has been a market catalyst. Gold hit a new all-time high on Monday, but is now consolidating a bit as investors wonder whether a flight to safety is necessary. And the dollar has fallen back into the lower end of its tight trading range.
Let’s look at the SPY chart. It made a double-bottom in June at the 200-day moving average followed by a textbook…
