2016 has come to an end, it was a year of many predictions, but some outperformed than others, here are the list of many sectors as they ended 2016 :
Nasdaq UP 7.64%
GLD UP 8.03%
S&P 500 UP 9.54%
Dow UP 13.4%
RUT UP 19.48%
XLF UP 20.09%
XLE UP 24.87%
SOX UP 36.62%
It is important that we get sector focus in looking ahead to 2017.
IF we look @ current environment of infrastructure spending, trade tension and deregulation, it is a fair assumption that some sector will benefit and some will get hurt.
Nasdaq may be the most affected by trade tension when tit for tat regulations will play out, so expect Nasdaq as an index to under perform and may be the weakest, yes there may be few stocks like AMD and some Chinese stocks whose business are solely in China or non-US based, may benefit.
XLF is expected to come out of multi year slump and may continue to outperform for several years, thus a very good bet.
XLE may continue to reward investors as Oil prices has firmed up and $60 is a good target for 2017.
GLD should benefit as trillions in borrowing for infrastructure spending fuels inflation.
RUT is also a good place where many base metals companies are benefiting from higher Copper, Zinc,Meth coal, Steels and other metals......
Based on how i see TAPE unfolding in 2017, it may be wise to underweight SOX, DOW, S&P 500 and Nasdaq......
As was the case in 2016, only few sector will carry this market in 2017.
About market, i expect market to correct somewhat after January 20th inauguration and hopefully will find support in 5 to 7% correction.
It is important to ignore pundits who are stuck in famous technology names, they will lag sectors identified above.
SO....2017 is here, adjust your portfolio to reflect what will work in 2017.
Good luck with your own analysis and comfort level.
BLOG does NOT give buy or sell.
Saleem
9 comments:
Hi Saleem,
And so the new year begins...
I finished last year with a 34.36% gain which was very nice considering how low I'd gotten in Jan/Feb. I am optimistic that this coming year will also be good for stock picking as certain stocks/sectors should do much better than others.
Portfolio: HBAN TECK CHK LYB ZYNE NEFF SPLK, ACIA CY OCLR QRVO MJCO, cash 9.0%
Stocktrader
Hi Stocktrader,
Outstanding performance by your diligence in stock picking.
Your insight into many sectors is a result of your focus and a desire to do well in investing / trading.
Saleem
Hi Saleem,
Sold CY @ 11.55
I think it's too early to see earnings momentum here and a report over the weekend suggests semiconductor mergers will be scrutinized more carefully, especially if the acquirer has Chinese interest (which is part of the CY rumor). I'm stepping to the sidelines for now.
Sold QRVO @ 53.60
I still fear earnings warnings out of the iPhone component makers early this year. Despite what I think could be a good 2017, QRVO has a lot to prove after two squishy quarters. I think investors could take a "wait and see" approach, and I will do the same for now.
Stocktrader
Hi Saleem,
Added to OCLR @ 9.02
There's a lot to like about the optical component makers this year as networks get upgraded worldwide. OCLR specifically is also positioned well for a takeover. A bounce off the 50 DMA and chart support could provide the catalyst for a move now.
Stocktrader
Hi Saleem,
Added a small amount to NEFF @ 14.10 (since it was almost full size anyways)
With construction spending doing well even ahead of any actual policy changes, and URI screaming today, I thought it a nice idea to boost my NEFF position a bit.
Stocktrader
Hi Stocktrader,
Yes...OCLR is looking good.
Good luck with more OCLR.
Saleem
Hi Stocktrader,
Good luck with more NEFF.
Saleem
Hi Stocktrader,
Bought OCLR @ $8.88
Saleem
Hi Saleem,
Good luck with OCLR.
2017 starting off volatile!
Stocktrader
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