Skip to main content

What theme is emerging from this market carnage?

With the market practically crashing again I wondered if there were any industries hiding stocks with strength.

Poking around in the Industry Inspector at our sister site TradingStockAlerts.com actually did yield a little theme in an unexpected area.

I sorted the list of industries according to percentage of stocks above their 50-day moving average. At the top of the list was the Consumer Services/Automotive Aftermarket industry which contains only one stock: Monro Muffler and Brake (MNRO).

Re-sorting to look for industries with stocks showing bullish MACD and up near the top was the Consumer Services/Motor Vehicles industry. Among the three stocks in this segment is Midas, Inc. (MDS), otherwise known as Midas Muffler.

These stocks seem barely affected by the recent downturn but the simple reason is strong earnings. Both companies rolled up increases in sequential revenues and earnings. On a year-over-year basis, Midas disappointed a bit on revenue but shined on earnings while Monro did well in both revenue and earnings.

The theme that may be emerging here is that consumers, impacted by falling markets, disarray in Washington and Europe and a stagnant job market, are getting increasingly skittish and are restricting their expenditures. Rather than risking getting financially extended in an uncertain economy by taking on an auto loan, many are fixing their current car. Truth be told, this is looking increasingly like the more prudent move.

This kind of caution about making large purchases due to fears of a potential recession can be a self-fulfilling prophecy. For investors, however, it does suggest that certain companies that help consumers extend the life of big-ticket items, or other companies that offer rock-bottom prices for consumers forced into frugality, will be the beneficiaries of this situation.

What industries or sectors do you think might fit this theme?

Disclosure: no positions in any stocks mentioned in this article

Comments

Popular posts from this blog

Running TradeRadar on Windows 7 and Windows 8

Development of the original TradeRadar Stock Inspector software was begun back in the days before Windows 7 and Windows 8 were available.

As these newer versions of Windows have become more popular, we have heard from some users that they are having problems installing and running TradeRadar on their newer PCs.

The good news is that TradeRadar will work just fine on Windows 7 and Windows 8. All you have to do is adjust the Windows Compatibility Settings to ensure TradeRadar runs as intended.

It is recommended that you can apply Compatibility Settings when running the initial installation; however, it is also possible to apply Compatibility Settings after the program has been installed.

Prior to installation
After downloading the install program, go to the folder where you have stored the TradeRadarStkInsp_7_Setup.exe or TradeRadarStkInsp_7_PRO_Setup.exe executable. Right-click on the executable file and select Properties. Click the Compatibility tab. Adjust the Compatibility mode to …

Durable Goods report for Sept just so-so but Computer segment is on fire

The Durable Goods advanced report for September 2011 was released on Wednesday.

I like to dig into the Durable Goods report because it can be useful for seeing how tech in aggregate is performing and how the sector may perform in the future. I always focus on two particular measures: shipments and new orders. Let's see how it played out last month.

Shipments -- 

I generally give less importance to Shipments since this is a backward looking measure reflecting orders that have been confirmed, manufactured and shipped. It's similar to earnings reports -- it's good to know but the data is in the past and we're more interested in the future. The following chart shows how September shipments looked for the overall tech sector:


Results for the overall tech sector were a bit weak but take a look at the next chart which tracks the Computers and related products segment:


Results here were actually quite good and, to make things even better, the previous month was revised upward.

N…

Alert HQ has moved!

End of an era!

This site was started way back in 2006/2007 to showcase my blog posts and the Alert HQ buy signals and sell signals. Alert HQ grew to include other kinds of stock alerts including Swing Signals, Trend Busters, Trend Leaders, Cash Flow Kings and more.

In the meantime, I built a sister site, TradingStockAlerts.com and I started using some of the same Alert HQ content over there. As a result, I am discontinuing the Alert HQ data here at Trade-Radar.com

The good news, however, is that all the Alert HQ signals and stock screens are still completely free. In addition, the pages have been enhanced so that you can hover over a stock symbol and a small chart will pop up so you can get a quick look at the stock's recent price action. If you click on a symbol it will take you to a page with plenty of financial and technical analysis information (still free!) as well as a larger chart that you can play with in terms of adding or deleting indicators, moving averages, etc.

Click …