When everybody sits on the same side of the boat, the boat overturns. June is about to end and this will be the worst first half for stock in decades. The US stock market got extremely oversold and so the market had to do something to shake everybody out of complacency and lazy thinking. It did bounce with intensity and now what it needs to do – is make some follow-through move. It will be such a relief if the market just stops falling. It will create a playground for strong stocks to start performing in a meaningful way.
Stocks of the Sector making a new high: Pharma/Biotech
I have already covered Eli Lilly LLY below $300 as the breakout stock to keep an eye on. LLY is now at $328 and this stock is poised to go higher. Apart from Eli Lily, Merck has also broken out and is ready to surge higher.
One can also look to add: United Therapeutics UTHR. It’s a profitable large biotech company
United Therapeutics works on finding cures for pulmonary arterial hypertension (PAH) and other life-threatening diseases. The company has gained FDA approval for five medicines. The company delivered impressive earnings last quarter with revenue up 8% and EPS up 44%. One can look to add with stop loss below 210.
The Energy Sector Stocks have resumed the uptrend
Crude Oil, Natural Gas, and Coal related stocks have outperformed by a big way in 2022. Over the last month, these stocks have come off in a big way but today – they are bouncing back in a big way. I continue to like
- XLE ETF
- Southwestern Energy
- Occidental Petroleum OXY
The Story Stocks
FDA is going after vaping and working on reducing nicotine in cigarettes and the company that seems set to benefit from this: is the 22nd Century Group XXII. I recommended it last week. The stock needs to move past 2.7 to generate momentum.
FUTU continues to march higher. I recommended the stock at $44 and the stock is now at 54.
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purposes. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers
Are you looking at LI Auto? any thoughts?
Yes I like Chinese stocks. Li has rallied a lot and this is not the market to chase and hence not recommending at these prices