U.S. markets closed a positive week, while global stocks pulled back slightly.
The S&P 500 hit a record high after a 1.11% rise, while the Dow Jones matched that percentage gain exactly. The Nasdaq recorded a more muted rise of 0.70%.
The MSCI Emerging Markets Index ended the week 0.69% lower, dragged down by a pullback in the Chinese stock market.
Prem Watsa’s bet on BlackBerry (BB) gained a solid 3.70%. Dan Loeb’s Baxter International (BAX) followed with a gain of 2.80%. Warren Buffett’s Berkshire Hathaway (BRK-B) recovered 2.38% after an extended period of underperformance.
Eight of your positions now boast double-digit-percentage profits. PayPal Holdings (PYPL) is currently up over 90.66% since my initial recommendation. Fiat Chrysler Automobiles NV (FCAU) is up by 48.97%.
Priceline (PCLN), Liberty Broadband (LBRDK), Fiat Chrysler Automobiles N.V. (FCAU) and Navigator Holdings (NVGS) are all trading below their 50-day moving averages and are currently HOLDs.
Portfolio Update
U.S. consumers are feeling good. Consumer confidence is soaring as we enter the holiday season. The big four indexes — S&P 500, DJIA, Nasdaq Composite and Russell 2000 — all closed at new all-time highs this past week. No wonder a near-record percentage of consumers are expecting higher stock prices.
Typically, high confidence is a contrary indicator. In fact, high consumer confidence in November has led to gains in December for the S&P 500 almost every time in history.
Right now, the U.S. market is firing on all cylinders, with both sentiment and momentum high.
Those investors who view themselves as “smart” and have exited the market expecting a significant pullback are so far regretting their decision.
As Fidelity’s Peter Lynch once put it:
“Far more money has been lost by investors trying to anticipate corrections then has been lost in corrections themselves.”
For now, enjoy the ride!
Sincerely,
Nicholas A. Vardy
