Pullbacks are key in today’s choppy environment. And the four plays I’ve Identified have pulled back from all-time highs — and more in today’s stock market recap. 

But first…

Stock Market Recap

Global markets are mixed today with U.S. stocks trading mostly higher. 

The market doesn’t look too unstable right now considering the Philly Federal Reserve data and trading action from Wednesday. I expect to see a choppy, sideways period in the bond market until the end of the summer. Traders will eventually see lower earnings-per-share, and interest rates will move higher due to inflation.

This week’s jobless claims were reported at a new pandemic low of 444,000. The Philadelphia Fed Manufacturing Index is a regional business growth measure that covers Pennsylvania, New Jersey and Delaware. April’s Index was reported at 50.2. May’s consensus was 45 and I was hoping for 45-47 but it was reported at 31.5 this morning. 

The CBOE Options Total Put/Call Ratio (EOD) is a sentiment indicator. It usually moves randomly from 0.7 to 0.9, but it is now at 1.07. The ratio didn’t reach these levels, even in March. There’s a good chance we may see more upside because the put/call ratio is so stretched out to the put side.

I’ve ranked the indexes by relative strength and the S&P 500 is the strongest right now. Although it dipped below its 50-day moving average, it hasn’t traded there like large-cap stocks. Mid-cap stocks are next, followed by small-caps. Traders should stay away from large-cap tech stocks. These names price in the highest earnings and stand to lose the most from rising interest rates.

Roger’s Radar: 4 Pullback Opportunities

Trane Technologies Plc (NYSE: TT) is an industrial manufacturing company. It provides climate control solutions for buildings, home and transportation. 

TT has a one-year return of 121.83% and has recently made an all-time high. It’s coming off of a pullback and is showing signs of following the upward trend.

I’ve also identified a steel and aluminum producer positioned to benefit from President Joe Biden’s infrastructure plan, an infrastructure ETF benefiting from global pandemic recovery, and a large-cap stock involved in the 5G movement. 

In today’s video, I’ll go over which index is recovering and which one is breaking down… the value of using the put/call ratio… the biggest Fed reports of the week and what they mean for the economy… and four pullback opportunities in major sectors.


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