It was a broadly flattish week in global stock markets. The Dow Jones rose 0.31%, the S&P 500 was up 0.52% and the NASDAQ jumped 0.90%. The MCSI Emerging Markets Index beat out U.S. domestic markets, ending the week 1.18% higher.
Big gainers in your Alpha Investor Letter portfolio included the Blackstone Group (BX), which jumped another 6.50%, and India’s ICICI Bank Ltd. (IBN), which recovered 5.79%. Blackstone is now up 22.58% and ICICI Bank is up 17.92% since my initial recommendation of each.
Several of your positions rose back above their 50-day moving averages and moved to a Buy. These include the Market Vectors Gulf States Index ETF (MES), ICICI Bank Ltd. (IBN) and the PowerShares Dynamic Energy Exploration & Production ETF (PXE). Both the Vanguard Global ex-US Real Estate ETF (VNQI) and The Blackstone Group (BX) hit new 52-week highs. VNQI, in particular, has entered into a very strong and steady uptrend.
Despite consistently improving economic news from Ireland, the iShares MSCI Ireland Capped ETF (EIRL) has entered a downtrend. With this position on the verge of breaking below its February low, I am recommending that you raise your stop in EIRL to $34.38 to lock in at least a 20% gain on this position.
We are now entering the heart of the summer doldrums, as traders and investors take off for their summer vacations. Market sentiment has turned mildly fearful, which is bullish over the short term. The last few trading days of July are also generally bullish.
I appeared on Fox Business on “After the Bell” last Friday commenting on the short-term trading opportunities in the Russian stock market, in the aftermath of last week’s downing of Malaysian Airlines Flight 17 — reportedly by Russian rebels. Although you don’t have any current holdings in Russia in your Alpha Investor Letter portfolio, when a market becomes this hated, you can generally count on a strong and “unexpected” bounce.
Finally, please don’t forget to join me for my quarterly teleconference call tomorrow. During this exclusive, subscriber-only call, you will hear my insights and perspectives as I discuss my outlook on the markets, provide a review of your Alpha Investor Letter portfolio and highlight my three favorite sectors for the rest of 2014. I will call you at 1 p.m. EDT on July 24; the call will last about an hour. If you can’t pick up at that time, a recording will be made available on the website. If you’re not sure if we have the correct phone number on file for you, send an e-mail to email@example.com by noon EDT today.
Google Inc. (GOOGL) added 1.77%. Google reported earnings last week, posting $4.99 earnings per share (EPS), up from $4.77 EPS year over year. Revenue climbed 22% year over year to $15.96 billion vs. a $15.61 billion estimate from analysts. Credit Suisse maintained an “Outperform” rating on GOOGL and raised its price target. Hold on for future gains. GOOGL is a BUY.
First Trust US IPO Index (FPX) gained 1.14%. The initial public offering (IPO) market remains hot going into the second half of 2014 as this year includes more IPOs than any year since 2000. In fact, there have been 148 IPOs so far in 2014 — up 61% year over year. FPX is a BUY.
WisdomTree Japan SmallCap Dividend (DFJ) rose 0.58%. Japanese small caps continued their recent momentum as DFJ recovered from a short-term dip. DFJ is challenging its 52-week high this week and is likely to break this level and move higher as the Japanese recovery continues. DFJ is a BUY.
The Blackstone Group (BX) jumped another 6.50% last week, bringing Blackstone’s total move to 10.22% since touching its 50-day moving average (MA) less than two weeks ago. BX reported a huge second quarter last week with income rising to $1.15 per unit, up from $0.62 last year, and widely exceeding the $0.68 average estimate from analysts. Revenue was up a whopping 57% to $2.26 billion, up from $1.44 billion last year, blowing past the $1.5 billion estimate of analysts. Blackstone also declared a quarterly distribution of $0.55 per common unit to shareholders of record at the close of business on July 28. This distribution will pay on Aug. 4. BX is a BUY.
Las Vegas Sands Corp. (LVS) dipped 0.47% on a tepid earnings report last week. Although LVS’ second-quarter profit rose 27%, it reported $0.83 EPS vs. an estimated $0.89. Revenue rose 11.8% to $3.62 billion vs. an estimate of $3.8 billion. LVS is a HOLD.
ICICI Bank Ltd. (IBN) jumped 5.79% last week, along with several banking stocks, on a recent positive Citigroup earnings report. Citigroup’s broad global reach gave investors optimism that other large non-domestic banks, such as IBN, will experience above-average second-quarter returns as well. IBN is scheduled to report earnings on July 31. IBN also moved above its 50-day MA and is now a BUY.
Markel Corporation (MKL) dipped 0.39% for its first week in the Alpha Investor Letter portfolio. This bet on the “Baby Berkshire” insurer is primed to move upwards in the weeks ahead. MKL is scheduled to report earnings on Aug. 7, after markets close. MKL is a BUY.
Latest Special Report
I encourage you to read the newly updated version of The Top 12 Stocks You Should Buy Right Now, which features three of my top investment recommendations for the second half of 2014, as well as bonus picks from each of my fellow investment newsletter editors at Eagle Financial Publications.
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