Weekly Investor – June 27, 2016
Brexit!
U.S. equity markets dropped last week and U.S. stocks ended the week with their biggest one day drop in 10 months after 52% of voters in the United Kingdom decided to exit the European Union. However, before plunging 3.6% on Friday, the S&P 500® Index had returned over 2% for the week as general consensus believed that the ultimate outcome of the vote would be to remain in the European Union. Upon news of the vote, shockwaves hit the global economy as investors sold off risky assets around the world on concerns that Brexit will hinder global growth. In other news, all 33 of the largest U.S. banks passed the Federal Reserve’s stress test and U.S. initial jobless claims fell, indicating a strengthening labor market. Looking ahead to this week, investor sentiment will likely drive the market in the near term as implications of the Brexit are digested by the market. Stay tuned….
The S&P 500® Index was down 1.6% for the week. The top-performing sectors in the S&P 500® Index included Telecommunications (1.4%) and Utilities (-0.3%), while bottom-performing sectors included Financials (-2.4%) and Basic Materials (-2.6%). In the fixed-income market, the 10-year Treasury yield was even during the week, ending at 1.6%.
We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.
Accelerating Sales Growth
Boston Scientific Corporation (BSX) engages in the development, manufacture and marketing of medical devices that are used in a broad range of interventional medical specialties.
BSX has undergone a multi-year turn-around effort. This turn-around has been driven by several new product introductions yielding positive results for the company. We believe these encouraging changes have put BSX in a position to be a leading growth company within the medical device space. With the potential for accelerating sales growth and improving profitability, we feel BSX offers our clients favorable odds.
Top 10 Equity Holdings
| . | |
|---|---|
| Alphabet, Inc. (Google, Inc.) | 6.6% |
| Post Holdings, Inc. | 6.6% |
| Danaher Corp. | 4.5% |
| ConAgra Foods, Inc. | 4.5% |
| Baxter International, Inc. | 4.2% |
| Masco Corporation | 4.2% |
| Red Hat, Inc. | 3.6% |
| CBS Corporation | 3.5% |
| Lowe’s Companies Inc. | 3.5% |
| The Hain Celestial Group | 3.4% |
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.
