Last week I mentioned that September 30 is the drop-dead date to be fully invested before the market really resumes its uptrend through the end of the year. This is a great time to buy because history has shown the market tends to pull back around now during midterm election years. However, it only goes up from there, and there are a few reasons for that.
First, five weeks after September 30, we have Election Day on November 4. Midterm elections have a notoriously low turnout. This means that if we have gridlock in Washington now, we’ll likely have gridlock after midterm elections. As frustrating as gridlock is for many of us, this is a positive for the market. Wall Street typically likes gridlock because it allows business to go as usual without sudden and unexpected changes from regulators.
On top of this, in mid-October we’ll see the next round of third-quarter reports. Judging from the upward analyst earnings revisions following this earnings season, this will be another one for the record books. After that, the rest of the year will be full of the general optimism that comes hand-in-hand with the holiday season.
So if you’re really looking to take profits on any of your current positions, you’ll want to make sure that you’re only selling stocks that have become more volatile of late. You can do this at any time using my Portfolio Grader tool, and to get you started here’s a list of 21 big-name blue chips that should be sold right away:
|Symbol||Company Name||Quantitative Grade||Fundamental Grade||Total Grade|
|BAC||Bank of America Corp.||D||D||D|
|CAG||ConAgra Foods, Inc.||D||D||D|
|CME||CME Group Inc.||D||D||D|
|CS||Credit Suisse Group AG||F||F||F|
|DB||Deutsche Bank AG||F||D||F|
|GM||General Motors Company||F||D||F|
|MSI||Motorola Solutions, Inc.||D||D||D|
|MUR||Murphy Oil Corp.||F||D||F|
|NMR||Nomura Holdings, Inc.||F||D||F|
|PXD||Pioneer Natural Resources Co.||D||D||D|
|TCK||Teck Resources Limited||F||D||F|
|TLM||Talisman Energy Inc.||D||D||D|