Stocks rebounded this week but be aware that upside resistance is probably at 1410 on the S&P 500, but if there’s a continued positive vibe about the resolution of the fiscal cliff, I think we can expect stocks and the S&P 500 to get back to where they were before the election and quite possibly back to new highs. In that event, some of the stocks that are the most overly discounted now – such as industrials, materials and technology – will have the best shot at gaining.
But also some of the stocks that succeeded the most during the time of the decline will also perform well. I’m talking about homebuilders, such as Lennar (NYSE:LEN), DR Horton (NYSE:DHI) and Pulte Homes (NYSE:PHM), as well as cell phone tower providers, such as SBA Communications (NASDAQ:SBAC) and American Tower (NYSE:AMT).
In addition, some of the biotech companies, such as Celgene (NASDAQ:CELG), Amgen (NASDAQ:AMGN) and Gilead Sciences (NASDAQ:GILD) should fare well.