The Best Stocks on My Radar as Choppy Trading Persists Amid Trump-Xi Trade Talk
These are tricky trading conditions ahead of Friday's important jobs report.
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The market spiked higher for a few minutes on Thursday morning following reports that President Trump had a phone conversation with Chairman Xi of China. That initial spike reversed quickly, but there was a new surge of buying on a post from Trump about upcoming meetings and good faith efforts to come to an agreement.
Before Trump’s comments hit, there was steady selling, with the S&P 500 undercutting Wednesday’s lows and the Russell 2000 IWM lagging. The bounce on the details about China negotiations perked things up, but it was not as energetic as some of the other bounces on positive trade news.
The spike is already fading again, and pockets of speculative action are narrowing. There are still over 500 stocks hitting new 12-month highs and good breadth, but the S&P 500 is only up 0.3% on news that would have generated a much stronger response a week ago.
Weekly unemployment numbers were reported to be a little higher than expected, and there is likely some concern about the jobs report on Friday. If the report is strong, it may raise concerns about inflation, and if it is weak, then there will be more concerns about slowing growth.
I’m doing very little right now. I have quite a few stocks with decent charts, but there is no compelling reason to add to the position right now. I don’t see any immediate catalysts, and if the indexes weaken further, there are likely to be some pullbacks as bids disappear in thinner stocks.
The best stocks on my radar right now are gold miner SSR Mining SSRM and data center operator Nebius Group (NBIS).
There has been some better relative strength in the biotechnology sector IBB recently, and I’m watching for chart development there. One name I added is uniQure QURE, which has been testing overhead resistance at $16.
I’m keeping new buys small and trying not to force anything because of the tricky market conditions. There is potential for good trade news at any time to spike the indexes again, but there is also a high risk of some poor data and more delays on trade.
At the time of publication, Rev Shark was long SSRM, NBIS and QURE.
