With business inventories low, manufacturing up in December, an increase in housing starts in November, consumer confidence up, and the unemployment rate falling, the economy appears to be slowly improving. But global issues and especially problems in the EU still plague the market.
January started on a positive note with the Dow up over 3%, thus the familiar saying, “As goes the first week of the new year, so goes the month and so goes the year,” was frequently repeated. But on Jan. 26, the Dow and the S&P 500 executed “daily reversals,” and since then prices have been falling. All of our internal and sentiment indicators are overbought, and so the market could end the month on a negative yet still have delivered one of the most impressive bullish performances in years.
It is important for investors to focus on high-quality stocks that pay dividends and/or have a history of regular dividend increases. Some also have stock buyback programs in place to use part of their cash and reduce the number of shares trading. Both strategies should have a positive long-term impact on the companies’ stocks.
Here are your top stocks to buy for February: