Vacuum
10/25/2004
The market loathes a vacuum and that is what the US elections are giving us - and I don't just mean the space between George W Bush's ears. Actually don't get me wrong, if I was American, I would vote Bush
and Kerry - because in US elections you can vote twice as the BBC Newsnight documentary shows - that's why it's the greatest democracy - there is so much voting going on.
Actually, I am an 'America-phile' - I have lived out there and trade US stocks and studied US politics at Oxford. I just wish they would in practice achieve the high standards they set themselves in theory (Bill of Rights etc etc).
Why the rant? I hosted the US trading night at the IX Expo last Friday at Olympia - which was fantastic by the way.
Anyway, back at the ranch. If the final quarter of a US presidential election year is supposed to be the best in terms of performance and so far this final quarter the US markets are performing so poorly, then if the old record is to be held up then it must be the case that after the elections we're due for a big rally. Hmmm
wouldn't bet my ranch on it. The only times the final quarter is not a big winner is when the election is very, very close, like in 2000
and in 2004.
UK
Stocks on the radar in the FTSE 350 for the momentum include: easyJet (upward - only problem is I don't like the business model and so can't suggest going long the stock); Morrisons (I like the management's ability and continue liking this one for the medium to longer term). I first mentioned it as a buy on Bloomberg TV in 2000 - since when you would almost have doubled your money; PZ Cussons (short-term momentum, should not fall below a tight 3 day low if the short-term upward trend is in place); Intertek (now looking to fall to some profit taking, but will resume up after that); Enterprise Inns - on the up again.
Drop me an email with your address to alpesh@tradermind.com if you would like a free multi-media CDROM on 'Investing Better' posted to you.
Value-Growth
Looking at the value-growth radar I see not much different from last week, except have a look at Brandon Hire. I examine these stocks on a variety of criteria including revenue growth and earnings growth year on year as well as short and medium term momentum.
Crazy Small Stock
These are high risk volatile stocks which could move sharply higher or move sharply lower in my view, but will almost certainly not stand still. Names on the radar include Amino, Deal Group too.
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