The 24-hour news cycle, amplified by all the sources of information around us – TV, radio, social media – can feel overwhelming. Recently, Psychology Today published an article on “Headline Stress Disorder.”
The term was coined by Steven Stosny, PhD, a couples’ therapist in Maryland and it refers to how continual alerts and updates from news sources lead to “an increase in general anxiety, worry, intolerance, and lowered frustration activation.”
If you are a news junkie like me, it’s easy to relate.
Investors certainly can feel overwhelmed given how much information is out there. And right now, things can feel especially frustrating because the data points are so mixed.
But while others get confused, you can profit, if you do the right things.
Worries about global economic growth and a new drop in the Treasury yield led to a roller coaster performance in the markets yesterday, as the Dow swung more than 300 points.
Last week, the 10-year bond rate fell below the 3-month rate for the first time since 2007. This “inverted yield curve” is typically seen as an early indicator of a recession.
But we’re not near a recession yet, and the market seems to want to outperform. Year-to-date the S&P is up almost 12% and is tracking to have its best quarter since Q3 2012.
All this conflicting news can make for tough decision-making.
Louis Navellier addressed a lot of these points in a recent update to his Growth Investor subscribers after the big drop off last Friday.
Ultimately, the stock market was extremely overbought, so it was due for a breather. And the international flight to quality that’s already underway — due to the ongoing Brexit mess — will continue to drive investors back to more domestic stocks with strong fundamentals. Lower Treasury yields are bullish for these stocks, which will attract money that’s rotating out of bonds.
However, I should add that these fundamentally superior stocks are growing increasingly scarce. The stock market is growing “narrower,” especially with the 2019 pension funding season near an end and the first-quarter earnings season around the corner.
Louis first made this call for his subscribers late last year. In short, multinationals will struggle in a global economic slowdown and much more difficult year-over-year comparisons. That means all the money coming to the U.S. market will go only to a smaller group of domestic stocks.
That makes it a stock-pickers market.
Louis has a reputation as a stock picking legend, so his advice about market circumstances affecting picks is always important.
His stock picking skill was demonstrated yesterday as one stock in his portfolio reported super earnings, reaching a new 52-week high.
Athletic wear retailer Lululemon soared after hours yesterday after its earnings beat. LULU reported net income of $218.5 million, or $1.65 per share for its fourth quarter, marking an increase of nearly $100 million from the year-ago quarter. On an adjusted basis, the business earned $1.85 per share, 11 cents above the Wall Street consensus estimate.
The company reported revenue of $1.17 billion, significantly beating the $928 million from the same quarter last year, while also beating analyst estimates.
Louis recommended the stock to his subscribers last summer and has seen a 34% increase in stock price since then. Below is a chart of the LULU’s performance since Louis advised his subscribers to buy.
Louis provides his Growth Investor subscribers with just these kinds of stocks. And, he’s transparent about why they are his picks based on his Portfolio Grader, which measures the things that are really important for growth companies.
Marketing-beating picks demonstrate strong fundamentals, such as sales growth and earnings growth. These kinds of companies also have quality leadership that run and manage a smart business. Louis also looks for “buying pressure”, also known as the money that is flowing into the stock.
You can’t get Louis’ picks for free, but you can use the Portfolio Grader for free to help evaluate the fundamentals of your own stocks and determine for yourself how you are feeling about your picks.
And do yourself a favor and put the phone down every now and then, and turn off the message alerts. Information is power, but too much can be confusing and not necessarily lead to better decision-making.
You can depend on experts like Louis Navellier to prioritize what’s important for you. Meanwhile, you can focus on other good habits … and maybe some baseball….
To a richer life,
Luis Hernandez, Managing Editor
and the research team at InvestorPlace.com
