Hated or loved, and nothing in between.
That's how the charts look to me at what seems like a crucial juncture, but may very well not be. I say that because this market turns on groups it hates, and you have to get on board before it does or you leave a huge amount of points behind.
In fact, with the possible exception of the insurers -- which have been loved forever because of consolidation and because of low inflation -- the tobaccos -- worshipped for their yields -- the defense stocks -- with the rest of the world re-arming -- and, finally, the body parts device stocks, it's amazing how inconsistent and fickle the market can be.
Before I go over the frantic nature of the turns, let's just play some things out: owning Chubb (CB) has been an amazing experience and is showing no signs of quitting. It is a combination of the aggressive ACE and the undermanaged Chubb, and it makes so much sense still that my endless hope that it will come down is looking dumber and dumber.
Marsh & McLennan (MMC), among the insurance brokers, is the exact same concept, lots of consolidation and decent pricing, and it won't quit either.
It doesn't matter which tobacco stock you like: those remain creatures of the Fed's inability to raise rates. Altria's (MO) always been my favorite in a group I am loath to recommend.
Body parts? Take your pick among Stryker (SYK), Zimmer Biomet (ZBH), or Boston Scientific (BSX) and Edwards (EW). It may not matter.
And defense? They rotate. Right now, Raytheon (RTN) is the flavor of the month, but L-3 Communications (LLL) is not far behind. Northrop (NOC) and Action Alerts PLUS charity portfolio holding Lockheed Martin (LMT) are just resting.
Now, let's talk nascent love. The semiconductors just won't stop going higher. This has been the pattern ever since Applied Materials (AMAT) showed amazing demand. My favorite in that part of the sector remains Lam Research (LRCX), which will be merging with KLA-Tencor (KLAC) soon. Justice blessed it.
I am shocked at how good Cypress (CY) semi acts despite the step down of TJ Rodgers -- maybe it is for sale? I do like Nvidia (NVDA) which has the hot graphics chips. But my faves remain Broadcom (AVGO), which had an amazing quarter, and NXP Semiconductors (NXPI), which I think will have one, too.
The health maintenance deals look like they are going through, but in the interim I would just go buy UnitedHealth (UNH). It doesn't have any problems with the Affordable Care Act Exchanges, and it can pull out of the unprofitable ones, unlike the other big players, because it isn't seeking to merge.
Anything with a yield's on fire, so you can buy the REITs -- look at how they raided down that darned Ventas (VTR). The utilities are amazing. I still like American Electrical Power (AEP), but I see the power in the whole group.
Now, what's so bad it is palpable? Retail, with the exception of the bargain stores, is either rolling over or will continue to roll over. I don't see how that's stopped, but I know that it is just a matter of time that it is. I can't come up with a reason to own Bed Bath (BBBY) or Macy's (M) or Kohl's (KSS), but I just don't know how bad they really are. Could they be like Seagate (STX)/Western Digital (WDC) bad? That's what the bears seem to be betting.
The other toxic, all-get-out group? The transports. These are reeking with potential disappointment, and I have to figure that all the rails and the airlines are going to see severe number cuts.
Unavoidable, and they can't bottom until the cutting is over.
The motors stocks are just from hell. I know that the peak auto thesis Doug has propounded has great resonance. Ford's (F) had a big move, and I think that's a good one to take some profits from when I pushed it very hard in early February.
General Motors (GM)?
Finally, people keep asking me if you can wade into the banks. I thought the regionals actually held up quite well last week on the employment number. I know they are for sale, but I know that they are too cheap to ignore, because the numbers have all pretty much come down already. I don't want to push and I don't want to give up.