Here we are again closing out another year. While the Mutual Fund owners reshuffle their portfolio, other large investors are readjusting their portfolios too in anticipation of next year's booming stocks. But, what are next year's winners and losers?My observation today was that given the Europe crisis, consumer stocks were interestingly getting sold. Thus, money is moving from the safer stocks into something. As expected, the winning industries were Technology, Drugs, and O&G in that order. That makes sense since the dollar is shining over the European crisis making our exports (electronics) popular during the holidays. The high dollar also kept the O&G's in check or slightly off. PFE's recent good news in last several days was contagious in that market. Now when the dollar drops again (Euro gets stronger), O&G should rise to lock in equal profits. Which one chases the other is questionable, but I always figure they like to maintain their profits, thus oil rises when dollar drops. Rise in oil = higher revenues = looking better = higher stock price. Technologies have been waiting to REALLY break out and expected to in 2012; i.e., given no really worse news in the world. I still see the demand in Emerging markets (India, China, Brazil) saving the world's butts. Of course, the caveat is stability or improvement. Will Russia take a dive re Putin's lackluster image? Will Iran stay quiet unless verbally provoked? Will OBlunder just shut up!
Sam's red, squeaky, "crystal ball" toy tells me Techs, O&G, Industrials, and Materials will again carry us forward in 1Q-1H of the year. It also predicts summer will again bring on another 6 months of waste. Short term? How about volatility for another 13 business days, clearing up around, well, first week in January. Get ready by 12/19 to start your BUYING during the low points of the volatility. Remember, Mutual Funds will clear the stuff that went sour this year so their funds look like they have good stuff in them to entice we dumb folk.
In short: Start pecking on my birthday (19th) thorugh remainder of year. Good time to sell your losses too if you need write offs, or SELL Long-Term Gains if in 10-15% tax bracket (AFTER the sale income included) to take advantage of 0% tax (thank you Mr. Bush). Then enjoy the rider through 1Q2012. Will the red squeaky toy work yet again?
Oh, I still think 12700 is next resistance level...could still make it before the new year rings in.
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