Weekly Investor – July 05, 2011
Bulls Gain Upper Hand
Market Summary:
The major U.S.equity averages all posted strong gains for the week, pushing firmly into positive territory for the year. Investors focused on a string of good news including positive movement out ofGreece, better-than-expected US manufacturing data, and a continued bounce back inJapan’s industrial production. While the July 4th holiday provided a momentary break for investors, it is short lived as earnings season is set to begin in earnest next week. Investors will be paying close attention for any clues that Corporate America may provide in setting second half expectations.
Over the past week, top-performing sectors in the S&P 500® Index included Energy (+7.2%) and Technology (+6.8%), while bottom-performing sectors included Consumer Staples (+2.9%) and Utilities (+3.3%). In the fixed-income market, the 10-year Treasury lost ground with the yield ending the week at 3.1%.
We continue to seek those companies possessing identifiablecatalysts, and focusing on those stocks with favorable odds.
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Uncertainty Creating Opportunity
UnitedHealth Group, Inc. (UNH) is best-known for its Health Care Services segment, which offers health benefit plans and administers the management of such plans for employers, employees, government agencies and for self-insured individuals. UNH also operates an OptumHealth segment, which is focused on personalized health advocacy and other health-based financial services. The company’s additional activities include pharmaceutical consulting services and pharmacy benefit management, just to name a few.
Over the past few years, UNH and its industry peers have experienced pressure from rising health care costs and a more challenging pricing environment. In addition, worries surrounding government regulation and the overall health of the economy have resulted in UNH’s attractive valuation. With industry fundamentals stabilizing and positive feedback from our Main Street contacts, we believe that UNH offers favorable odds for our clients.
Top 10 Equity Holdings
| . | |
|---|---|
| Danaher Corp. | 4.1% |
| Qualcomm Inc. | 3.9% |
| MasterCard Inc. | 3.9% |
| Biogen Idec Inc. | 3.8% |
| EMC Corp. | 3.6% |
| UnitedHealth Group | 3.6% |
| Gilead Sciences Inc. | 3.4% |
| Jabil Circuit Inc. | 3.4% |
| Google Inc. | 3.3% |
| FactSet Research | 3.3% |
U.S. Equity Indices
| Index | 07/01/11 | Week % Chg | YTD % Chg |
|---|---|---|---|
| DJIA | 12,582.8 | 5.4% | 8.7% |
| NASDAQ | 2,816.0 | 6.1% | 6.2% |
| S&P 500 | 1,339.7 | 5.6% | 6.5% |
| Russell 1000 G | 618.2 | 6.0% | 7.6% |
U.S. Credit Rates
| Index | 07/01/11 | 06/24/11 | 12/31/10 |
|---|---|---|---|
| 3 Month T-Bill | 0.1% | 0.1% | 0.1% |
| 5 Year T-Note | 1.7% | 1.4% | 2.0% |
| 10 Year T-Note | 3.1% | 2.9% | 3.3% |
| 30 Year T-Bond | 4.4% | 4.2% | 4.3% |
| Prime Rate | 3.3% | 3.3% | 3.3% |
This newsletter presents selected recommendations from portfolio managers of Argent Capital Management LLC, a registered investment advisor. Opinions reflect the portfolio manager’s judgment on the date above and are subject to change. A list of stocks recommended by Argent is available upon request. You should not assume that these recommendations are or will be profitable. In the course of it’s business, Argent’s client accounts may be buying and selling these stocks.
