Do you really want to hear anything else about the election? Me neither, but you're getting my initial quick-hitters, anyhow.
The market appears to be loving the results thus far. I think that is because we're avoiding social unrest (thus far) and the end results project a stasis in terms of what gets done. Little will change in the House/Senate while the White House swaps parties ... probably.
Where does that leave us for 2021 and beyond?
I continue to think cannabis and electronic vehicles. That hasn't changed. Many EV names are feeling the love, while cannabis is seeing some profit-taking. The split in power probably keeps cannabis a bit contained, but we're seeing solid state-by-state progression of legalization and decriminalization. Within the next four years, the majority of states will have approval even if the Fed is slow to act. The dips are worth buying, especially in a name like Village Farms ( VFF) and Cresco Labs ( CRLBF) .
As far as the EVs go, I wouldn't be chasing here. Seeing Li Auto (LI:Nasdaq) up 14%, Kandi ( ( KNDI) ) up 28%, Nio ( NIO) up 9%, and Xpeng (XPEV:NYSE) up 16%, I would either be selling calls against the names or looking to collar them. Taking a few profits wouldn't be the worst thing in the world, either.
While I'm not in the infrastructure camp, given the lack of a "blue wave," I do think health care needs to be examined. I could see a name like Multiplan ( MPLN) doubling over the next four years, with Biden in office. We're already seeing UnitedHealth ( UNH) , Anthem ( ANTM) , and Cigna ( CI) blast off. Double-digit moves on those aren't worth chasing. We need to have a little patience and wait for entry opportunities rather than chasing. Instead, today, I'd look at MPLN or Centene ( CNC) or even CVS Health ( CVS) , if I want to be involved immediately. Should we see consolidations or pullbacks in the bigger moves, then I'd consider getting involved.
Lastly, I still like gold and gold-related names based on what we're seeing. Although the metal has stalled, the setup for a big push higher exists. You can kind of take your pick as Newmont ( NEM) , Barrick Gold ( GOLD) , Franco-Nevada ( FNV) , or even Pan America Silver ( PAAS) for silver exposure, all have similar setups.
Lastly, I don't think a Biden White House would play out well for travel and leisure over the next year. I expect a more conservative White House, which could spell problems for airlines, hotels, restaurants, and in-person entertainment. If you've caught some big bounces in those areas, then I would keep close tabs on your positions. Ironically this will be a positive for the biggest names like Starbucks ( SBUX) , Domino's Pizza ( DPZ) and Chipotle Mexican Grill ( CMG) .
That's the quick and dirty instant reactions, so take them for what they are worth, but for me, they provide a starting point.
(SBUX and CVS are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells these stocks? Learn more now.)
