The stock market woke up on the wrong side of the bed yesterday, driving the S&P 500, Dow and NASDAQ down 2.1%, 1.9% and 2.6%, respectively. While stocks chopped around today, the volatility is par for the course right now.
Here’s the reality: We are heading into the “dog days of summer,” so it’s normal to experience an uptick in volatility over the next two weeks and into September.
The fact is late August and early September are typically a quiet period for stocks, as the quarterly earnings announcement season is largely over and Wall Street jets off on late-summer vacations. This creates light trading volume and opportunities for unscrupulous short sellers to jerk the market around.
It’s for these reasons that I hate the month of August.
But as long as you’re invested in fundamentally superior stocks, you shouldn’t be concerned. Sure, they may experience wild swings in this low liquidity environment, but good stocks always bounce like fresh tennis balls. Bad stocks, on the other hand, fall like rocks.
After taking a close look at the latest data on institutional buying pressure and each company’s fundamental health, I decided to revise my Portfolio Grader recommendations for 77 big blue chips. Of those 77 stocks, there were plenty of “rocks.” Specifically, 15 stocks were downgraded from a Hold (C-rating) to a Sell (D-rating) and 26 stocks were downgraded from a Buy (B-rating) to a Hold. I’ve included the first 10 stocks that were downgraded to a Sell below, but you can find the full list here. Chances are that you have at least one of these stocks in your portfolio, so you may want to give this list a skim and act accordingly.
|Ticker||Company Name||Total Grade|
|AWK||American Water Works Company, Inc.||D|
|CSCO||Cisco Systems, Inc.||D|
|EL||Estee Lauder Companies Inc. Class A||D|
|KKR||KKR & Co Inc||D|
|SNOW||Snowflake, Inc. Class A||D|
|SPGI||S&P Global, Inc.||D|
|ZTS||Zoetis, Inc. Class A||D|
If you want to make money in the current environment, it’s important to invest in fundamentally superior stocks, as a massive shift to quality has occurred in the past couple of weeks. If you’re not sure where to look, then you’ll want to consider my Growth Investor Buy Lists, which are chock-full of high-quality stocks that are becoming go-to names for investors.
I will be releasing my latest Top 5 Stocks list, as well as several new recommendations, in Friday’s Growth Investor Monthly Issue for September. Join me at Growth Investor today so you have full access to those names as soon as the issue is released, as well as all my past Weekly Updates, Monthly Issues, Special Market Podcasts, Special Reports, and much more!
P.S. There is a great divide opening up in America – and investing in my Growth Investor stocks will help get you on the right side of it. On one side is a new aristocracy that’s amassing more wealth more quickly than any other group in American history. For people like me, the one percent, life has never been better, more prosperous.
On the other side, the opposite is happening. Wealth is flowing out of the pockets of ordinary Americans at an unprecedented rate.
What’s happening is only going to gather in strength over the coming decades. It certainly won’t weaken.
Few Americans even know that any of this is going on. I’ve never seen anyone from my side of the chasm step forward to explain any of these things.
It’s why I put together this video. In it, I’ll lay out exactly what is happening, including several key steps every American should take right now.
The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
American Water Works Company, Inc. (AWK)