Take the Opportunity to Raise a Little Cash

 | Jul 08, 2016 | 10:16 AM EDT
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Stock quotes in this article:

gps

,

hsc

,

whr

,

axe

,

lnn

What a tape. We have to watch oil, European banks and China, among many other things. Each have more unknown and unpredictable forces driving them than we can count. We are in unprecedented times in many respects, which yields a lot of caution.

And deservedly so. We are zero bound in global rates. Currency, trade flows and commodities are gyrating aggressively in six-month bands. Even retail comparables, month-to-month, are difficult to forecast.

Take Gap (GPS) ; following first quarter results that fell well below expectations, last night it posted a +2% comparison for June, well above the forecasts for -3.1%. Well done. Analysts are calling for "Green Shoots" in retail now after one of the most abysmal quarters in retail, overall, that I can remember. Numbers will likely revise higher as a result of this stabilization in near-term comp store sales.

And what about the jobs number? Strong, after a few months of disappointments. Around 130pm, there will inevitably be someone on CNBC saying the jobs number will prompt the Fed to raise rates and the market will give back the gains of the morning. It is uncanny.

This is just the market we are in: "Follow the most recent trend, let fundamentals take a backseat, and proceed." For me? I think some protection is still warranted here. Take opportunities to raise a little cash in names that are working well. I think buying stocks with solid fundamentals in the domestic economy continues to a good play. I like restructuring workouts, like Harsco Corporation (HSC) , and trying to find growth at a reasonable price.

Some recent pullbacks in small and mid-cap growth stocks are appearing attractive to me at the moment. IPG Photonics IPGP, Whirlpool Corporation (WHR) , Anixter International (AXE) and Lindsay Corporation (LNN) all seem interesting today to slowly put some money to work in newer ideas. 

I've written on Anixter, Harsco, and Lindsay so far, as I collectively build out my "Real Money Portfolio" of alpha longs and shorts.

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