SET Portfolio Update December 2015
We’re into the home stretch of 2015.
Right now the S&P 500 is up 3% year-to-date. The October rally erased the September losses. But November brought a return to the flat market that was the norm for most of the year.
Once again, the strong performance of a few mega-cap stocks is the force that is keeping the S&P 500 positive for the year. The vast majority of stocks have seen their stock price move lower this year.
Will a Santa Claus rally emerge to propel the S&P 500 high into year end?
One thing that has been a positive for US stocks is the strong US Dollar.
Historically, the S&P 500 moves in lockstep with the value of the US Dollar. And the dollar has been showing signs of resuming the uptrend that has been in place over the last few years.
However, the strong US Dollar continues to put pressure on commodity prices and emerging market stocks.
So, there’s a good chance a Santa Claus rally will help lift US stocks. But the gains are likely to be concentrated in sectors that aren’t exposed to commodities.
Now, onto the updates…
. . . . Market Vectors Retail ETF $RTH – Hold
RTH has enjoyed a nice rally out of the gates. In just a few weeks, RTH has gained nearly 5% to $78.38. Retail stocks are in a good position to benefit from the current market environment. And they have a low bar to clear after a generally disappointing 3rd quarter. RTH is above our $77.50 buy up to price. The price target is $90.00.
. . . . Vanguard Energy ETF $VDE – Buy
VDE is our investment in the downtrodden energy industry. My theory is that supply and demand will come back into balance in 2016 as smaller producers are forced out and production slows. This will benefit the largest oil stocks the most… and VDE gives us great exposure to the largest oil companies. Buy up to $97.50. The price target is $110.00.
. . . . Utilities Select Sector SPDR $XLU – Hold
XLU is trading for $43.04. That’s about mid-way between the recent highs and recent lows. It lost some of its bullish momentum when the Fed put a December rate hike back on the table. A rate hike is already baked into the cake. If the Fed doesn’t take action, XLU should rally. If they do raise rates, XLU should hold steady. Continue holding. The price target is $50.00.
. . . . PureFunds ISE Cyber Security $HACK – Buy
HACK is moving steadily higher… gaining 2.5% over the last month. This is a clear indication that investor sentiment toward these stocks is improving. What’s more, Palo Alto Networks $PANW just reported great earnings. They said corporate and government spending on data system protection is growing quickly. Buy HACK up to $32.00. The price target is $50.00.
. . . . ALPS Medical Breakthroughs $SBIO – Buy
SBIO is up 7.8% over the last month. This volatile ETF is up more than 20% from the recent lows. This type of volatility is to be expected with developmental stage biotech stocks. Those of you that followed my advice to build your position in this ETF over time are now in position to reap the rewards. Buy SBIO up to $45.00. The price target is $80.00.
. . . . US Global Jets ETF $JETS – Hold
JETS is now 4% below the $26.06 high. But it’s still in a bullish uptrend. The next bounce should push our airline ETF toward our price target. Continue holding. The price target is $30.00.
. . . . iShares Medical Devices ETF $IHI – Hold
IHI is moving higher in a bullish uptrend off the September lows. The ETF is up 2.9% over the last month. If this price action continues, it should make a run at the 52-week highs before the end of the year. Continue holding. The price target is $140.00.
Action to Take
- None at this time.
Category: SET Portfolio Updates
