We always have to keep one eye on the fundamentals during this period of what many describe as total excess. We have to use the data we can grab to be able to make a case that we aren't going too far too fast beyond the promises that we've gotten from President-elect Trump, promises that have to come true or else we are in for a serious correction in the first quarter of 2017.
Fortunately, we have both macro or top-down data and micro or individual company reports, to do a reality check.
For example, we got existing-home sales today, which were quite strong -- 5.61 million in November, the best since February 2007. I can't stress how important that figure is. Robust existing-home sales are crucial to all sorts of businesses, from banks to retailers to service companies that help install and renovate.
At the same time, we got Association of Home Appliance Manufacturers data, which showed an astounding 13% increase in November to 5.62 million, nicely verifying the existing-home data.
Now, while Home Depot (HD) didn't take off on these figures, Whirlpool (WHR) jumped more than four points. My take? Home Depot becomes a stock to put on your radar screen as we bounce around Dow 20,000. I am partial to Masco (MAS) , the kitchen and bath company, too, off these numbers.
How about individual stories? Yesterday I was pleasantly surprised by the commentary on both the Darden (DRI) and Carnival (CCL) calls. Weekend dining and lunch were very strong for Darden, parent of Olive Garden, even though CEO Gene Lee acknowledged that it's competing against "new necessities today, whether smartphones, whether it's your cable bill, your Netflix bill. I mean, they have increased significantly over the years." Hmm, is there any wonder why takeout pizza is so strong? Makes me want to buy both Darden and Domino's (DPZ) .
Then there's Carnival. I had my doubts about Carnival because of worries about the Zika virus, but I clearly misunderstood the desire worldwide to cruise, particularly on Carnival. The numbers here were outstanding, far better than I thought, and I think 2017 will be another bang-up year. The most telling moment on the call? The incredible demand for cruise ships in China. The company just doesn't have enough ocean liners to go around. A truly high-quality problem.
It might look like we hit a speed bump with both Accenture (ACN) , the gigantic information technology consulting firm, and with Federal Express (FDX) , the freight transportation company. Both stocks were down badly. But the decline in Accenture's stock was caused by the typical cautious commentary, not by the current fundamentals. Demand is outstanding and the company blew away earnings coming in at $1.58 per share when the Street was looking at $1.50. I would buy this stock tomorrow without a problem, a good example of where there is still value in this market.
FedEx is tougher. I don't know if I instantly want to buy the stock of a company that is up almost 30% this year alone, but boy oh boy, did they have to spend a lot of money to keep up with e-commerce, a terrific sign for omnichannel retail in general and Amazon (AMZN) in particular. (Amazon is part of TheStreet's Growth Seeker portfolio.)
The lone dark spot? Athletic wear. We got very mixed numbers out of Nike (NKE) domestically even as the company went out of its way to say basketball sneakers are strong. Then Finish Line (FINL) completely disappointed with a horrendous miss and a similarly awful guide-down.
I know Nike beat the numbers, but I didn't like what I heard from either company about domestic business. To make matters worse, this is not a Trump stock as it already pays low corporate taxes and is badly exposed to China, where the Communist Party could easily retaliate against Trump by just saying no to the Jordans.
Let's admit, though, if the lone dark spot is $100 plus sneakers in a day where the macro and the micro were strong? What can I say? I will take it. Business is still good in the real world and it can't trip up the market so far as it awaits the Trump turbo-growth tripod of deregulation, repatriation of overseas profits and a slashing of corporate taxes.