U.S. markets have managed to rebound ferociously over the last two weeks as bargain shoppers stepped in following the Fed stimulus-fear induced sell-off which started on 5/22/2013. With earnings seasons upon us however, the bull may be in for a rude awakening as volatile trading and profit taking can sweep over Wall Street at the slightest sign of industry bellwethers missing the mark and revising their outlooks[for more commodity futures news and analysis subscribe to our free newsletter].
Last week’s disappointing employment report put a dent in the bulls’ confidence; however, the parade has resumed with full force this week thanks to a solid start to earnings season with better-than-expected results from Alcoa. While major equity indexes have resumed their ascent to record highs, the skeptics continue to call for a market top in the face of rising prices. With no major fundamental changes taking place over the last few weeks, it’s difficult to gauge when the long-overdue correction will actually strike, as traders and investors alike have more reasons to buy on the dips rather than take profits [for more market news and analysis subscribe to our free newsletter]. Steel manufacturer Nucor Corporation (NUE) presents an intriguing opportunity at the moment that warrants a closer look from swing traders looking to get a piece of the action on Wall Street.
Many investors are familiar with a group known as the “Dogs of the Dow”, or the 10 highest yielding stocks at the end of the prior year. Many investors use this strategy to help pick securities for the coming year, as they will not only offer strong dividend yields, but it may also be that their prices have been beaten down. Dividend yields and stock prices have an inverse relationship, meaning that a higher yield could reflect a poor performance from a stock in the prior year. Many feel that the dogs are oversold and the fact that they are still offering high dividend yields means the company is still strong [see also 12 High-Yielding Commodities For 2012].