Last week was a solid one for U.S. stock markets, with the Dow Jones up 0.91%, the S&P 500 gaining 0.83% and the NASDAQ jumping 1.16%. Global stock markets performed even better, with the MCSI Emerging Markets Index ending the week 2.93% higher.
The strength of global stock markets was reflected in the performance of your Alpha Investor Letter holdings as well.
Big gainers in your Alpha Investor Letter portfolio included the Cambria Global Value ETF (GVAL), which added 5.11%; Skyworks Solutions Inc. (SWKS), which was up another 4.26%; the Vanguard Global ex-US Real Estate ETF (VNQI), which jumped 4.02%; and Google Inc. (GOOGL), which rose 3.57%.
Several of your positions — all of them global — rose back above their 50-day moving averages and moved back to a BUY. These include the Vanguard Global ex-US Real Estate ETF (VNQI), the iShares S&P Global Timber & Forestry ETF (WOOD) and Cambria Global Value ETF (GVAL).
New 52-week highs included the Guggenheim Spin-Off (CSD), the Vanguard Russell 2000 Index ETF (VTWO), Markel Corp. (MKL), Skyworks Solutions Inc. (SWKS), Actavis plc (ACT) and the Market Vectors Biotech ETF (BBH).
In contrast, your position in India’s ICICI Bank (IBN) has been faring poorly, despite two interest rate cuts and the announcement by the World Bank that it expects the Indian economy to grow faster than China in 2015. When a stock market fails to react positively to such news, it is a sign of weak market internals. You are already near your stop of $10.00 and are likely to hit your stop on this one in the coming days.
Your bet on a rising U.S. dollar through the PowerShares DB US Dollar Bullish ETF (UUP) also pulled back this week, as the prospect for Fed tightening was pushed further out. Looking at the chart, this is still within the range of a normal correction in an uptrend. That said, I am recommending that you tighten your stop in this position to $24.93 to lock in at least a 10% gain in this trade.
This also is a good time to raise your stops to reflect some of your recent big gains. Raise your stop in Guggenheim Spin-Off (CSD) to $43; iShares Currency Hedged MSCI Germany (HEWG) to $25; Actavis plc (ACT) to $267; Biotech ETF Market Vectors (BBH) to $118; Skyworks Solutions (SWKS) to $84.25; Markel Corp (MKL) to $711; and S&P Global Timber & Forestry Index iShares (WOOD) to $50.50.
Finally, it was good to speak to all of you on our Alpha Investor Letter quarterly conference call on Monday. In case you missed it, you can listen to the recording.
Portfolio Update
Guggenheim Spin-Off (CSD) added 1.69%. This play on corporate spin-offs is back to its major resistance level at $49.00 after hitting a new 52-week high on Monday. CSD has yet to ever breach the $49 level in any meaningful way, so a strong move above this level would indicate a significant breakout to the upside. CSD is trading above its 50-day moving average (MA) and is a BUY. Raise your stop to $43.00.
Vanguard Global ex-US Real Estate ETF (VNQI) jumped 4.02% last week as it moved above both the 50-day and 200-day MAs. With Europe entering what appears to be a more sustained period of economic recovery, both European and global real estate could be in for a long and profitable climb. VNQI is now a BUY.
Vanguard Russell 2000 Index ETF (VTWO) climbed 1.79%. Two weeks ago, this widely followed index of 2,000 small-cap names climbed back above its long-held significant resistance level of $98.00 to both new 52-week and all-time highs. I expect small caps will have a very strong 2015 after underperforming their large-cap brethren last year. VTWO is a BUY.
Cambria Global Value ETF (GVAL) added 5.11% last week, strongly outperforming the large emerging markets index iShares MSCI Emerging Markets ETF (EEM). GVAL is a globally-based, deep-value play on a basket of the 10 cheapest markets on Earth. Once GVAL and the recovery in global stocks begin to gain momentum, I expect GVAL will become a popular vehicle to capture this global stock market megatrend’s gains. GVAL moved above the 50-day MA and is a BUY.
Google Inc. (GOOGL) rose 3.57%. After trading along its 200-day MA the week prior, GOOGL moved decidedly above this level — a good sign for future gains. Having strong ties to the federal government is a plus for any company, and Google’s ties are quite robust. It recently was reported that Google representatives have met with senior officials nearly 230 times during Obama’s tenure in the office of President. That’s nearly once every working day of the year. Strong ties indeed. GOOGL is a BUY.
Newly Updated Special Reports
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