A rocky October looks likely to treat investors with volatility up to the bitter end.
As Monday’s session showed, there may be plenty of up and down action left to toss this market around. Investors who haven't already done so may now start battening down the hatches. Don’t look to November and midterms for any relief, says CrackedMarket’s Jani Ziedins.
“No matter what happens election day, we should expect a knee-jerk of selling as investors from the losing party dump stocks before the other side can wreck the country,” he says.
If you’re struggling to rationalize this market, then stop and check out our call of the day from traders Howard Lindzon and Ivaylo Ivanhoff, who lay out how to navigate a market correction via their Momentum Monday video . Among other things, they highlight a handful of stocks — household names in some cases — poised to lead when the dust has settled.
A big name on their list is Walmart WMT, +0.87% already standing out as a leader and holding up the market as institutional investors have swapped it out for Amazon AMZN, -6.33% . The online retailer is down 23% in October versus a 6% gain for its mostly bricks and mortar rival that has a “massive digital appetite,” notes Lindzon.
Starbucks SBUX, +0.52% and its “addicted base” is another one to watch coming out of the correction, says Lindzon, the co-founder of StockTwits. He’s even more excited about McDonald’s MCD, -0.06% praising the fast-food giant’s hustle to improve its food, coffee and stores. Set for a 3.6% gain in October, McDonald’s is a “great company that’s viable on big dips,” and is more of a technology company than it ever was, says Lindzon.
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Other possible leaders mentioned: Cadence Design Systems CDNS, -2.90% , Audiocodes AUDC, -2.70% , CME Group CME, +0.42% , PayPal PYPL, -2.66% and even Goldman Sachs GS, +1.00%
“In a bull market, [Goldman] could start being valued more as a tech holding company. It could be a long-term play,” says Lindzon.
While you’re at it, it’s worth checking out Steve Sjuggerud’s Daily Wealth blog, where he talks about how the surprising big champions from the last great “melt-up” of 1998 to early 2000 — biotechs — are getting ready for a repeat performance.
The market
Dow YMZ8, +0.28% , S&P 500 ESZ8, +0.32% and Nasdaq NQZ8, +0.16% futures are struggling to hold onto some green after a bigger bump in Asia. Monday’s volatile session saw the Dow DJIA, -0.99% swung more the 900 points, but finishing lower, along with the S&P SPX, -0.66% and Nasdaq COMP, -1.63% .
Gold US:GCU8 is off some, the dollar DXY, +0.22% is up a little, notably against the USDJPY, +0.40% and crude US:CLU8 is mixed.
Check out the Market Snapshot column for the latest action.
Europe SXXP, -0.08% also struggled, while Asia finished mixed, but with a 1% gain for the Shanghai Composite COMP, -1.63% .
The stat
The Nasdaq saw its 8th session of a 1% or greater loss, the most since August 2011 when it also logged a string of eight straight losses. If the Nasdaq logs one more 1% down day, it’ll be the most in a calendar month since Nov. 2008, when it also had nine, according to Dow Jones Market Data.
The chart
How volatile has October been? Our chart of the day, from The Daily Shot, shows how the S&P 500 hasn’t seen such rocky times since the so-called “volmageddon” of February:
The Wall Street Journal’s Daily Shot
The quote
AFP/Getty Images
‘I think that we will make a great deal with China and it has to be great, because they’ve drained our country.’ — That was POTUS in an interview with Fox News late Monday, with a comment that gave a boost to Asian stocks and U.S. stock futures at least for awhile. It comes a day after reports the White House is getting lob billions more in import duties at China if a deal can’t be reached.
Meanwhile, Trump may be getting ready to target the rights of babies of non-citizens and unauthorized immigrants born in the U.S.
The buzz
Rolling out results this morning, General Electric GE, -1.24% is up despite a miss, and Coca-Cola KO, +1.18% is up on beats, while Pfizer, PFE, +1.48% is down after a revenue miss. Mastercard MA, -3.27% , Under Armour UAA, +1.17% and Allergan AGN, -1.92% are also on the list. In London, BP BP, -0.17% earnings soared on strong oil prices.
After the close, we’ll get Facebook FB, -2.26% , EBay EBAY, -1.90% , Amgen AMGN, +1.19% , FireEye FEYE, -3.30% and Electronic Arts EA, -5.23% .
Check out: Red faces at Facebook after data security breach in London
Read: Amazon was almost worth $1 trillion, but it is down $119 billion in just two trading sessions
WildHorse WRD, -5.83% is galloping away this morning on news Chesapeake Energy CHK, -2.62% will snap up the natural gas and oil-exploration group in a roughly $4 billion deal. And MKS Instruments MKSI, -2.12% is buying Electro Scientific Industries, with a 101% premium attached to that deal.
Check out the curious case of Curaleaf , an illegal pot company that’s suddenly worth $4 billion.
The Case-Shiller home price index, consumer confidence and home ownership stats are on the docket for Tuesday.
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