It was very interesting watching Cramer’s opening missive last night, he pointed out that the outperformers on the year are actually the stocks with the juiciest dividends. The staples the healthcare’s, the utilities. These sectors are up HUGE compared to the broader market. Why? He says dividends. But keep in mind he also noted that these guys don’t have the best businesses, For rising commodity costs are hampering some of the staples like PG, CLX, and CL. JNJ and the healthcares just have been having their own internal issues. These are just to name a few. I would direct you to watching his opening missive, but keep in mind fundamentals will eventually matter, and their businesses will eventually matter.
In a growing economy look at the Beta names, look for those breakouts, as I am writing this entry, the Coals are breaking out, the industrials are breaking out the materials are breaking out on a technical basis. These stocks have been the hardest hit ever since April. I also want to note it’s not how you trade during the day but it is how you close. So I will be watching this close to see if we can get follow through. I’m not a bull or a bear, I’m just stating facts. Watch the Staples, watch the utilities, watch the beta names, and most importantly watch how we close.
-Benjur
