WASHINGTON, January 24, 2017 \u2013 As we\u2019ve already noted in our companion column ,
\u201cThe heroes behind Tuesday\u2019s [today\u2019s] currently super-sized plus [market] move in are stocks of companies lumped together under the sector category \u201cMaterials.\u201d While materials include things like lumber and paper, they also involve key construction metals and \u201cbase metals\u201d such as copper, tin, lead, aluminum and iron\u2014stuff you use to make other stuff you can sell to people. Fuels are also included in this general category.\u201d
If you gather more raw materials, you use them to make even more stuff, assuming, based on your own internal research, that more people are now willing to buy more stuff. CEOs and CFOs can\u2019t get this wrong, or their companies will get flattened when they release their company\u2019s next quarterly earnings. Hence, corporate actions like this are important to note.
Read also: Tuesday markets: Materials, builders go wild
You can watch the daily action in the FinViz \u201cheat map,\u201d a current copy of which appears atop this article. This live, continuously updated heat map is available in the upper right corner of the FinViz home page. By clicking on this image, you\u2019ll get a larger, interactive map, which, as you can see in our screen grab version above, lists key stocks by key sectors.
Perhaps paradoxically, the \u201cheat\u201d\u2014the current hot stocks and sectors at any given time\u2014are designated by light-to-darker shades of green, while the colder (negative) stocks and sectors are highlighted in red. In other words, green-to-intensely bright green stocks and sectors are being bought, while red or intensely red stocks and sectors are being sold. Hot is green, red is cold. If you scroll over the map, you\u2019ll get even more information on the individual stocks in each area including current moves and a tiny short term chart of recent action.
As you can see on the map above and on the live site, at least as of this afternoon, materials stocks and the financial sector are seriously in their happy place.
The only sector that\u2019s getting badly clipped today is the pharmaceutical\/healthcare sector. With the president crusading as vigorously against the hated Obamacare as he is crusading in favor of exploiting natural resources and building things, it\u2019s not difficult to see why pharmaceuticals are dull to bright red on the FinViz heat map Tuesday.
High drug prices\u2014and the fact that pharma companies, pharmacies, hospital chains and health insurance companies\u2014colluded with Obama and his all-Democrat House and Senate to build \u201cObamacare\u201d has, at least for now, put the pharma stocks in particular in Trump\u2019s gun sights. Fearing a substantial risk to future profitability, investors are currently fleeing the sector, which is why it\u2019s currently glowing an angry red on our heat map.
Trading diary
We\u2019ve vowed to try to get back into action this week, after last weeks meandering and largely negative market action.
We\u2019re happy with our position in copper and gold miner Freeport-McMoRan (symbol: FCX), and, in fact, doubled our position yesterday. We\u2019re currently up over 11 percent in this issue and are holding for now. We\u2019d put a stop order underneath it, but it\u2019s too volatile for that, and we could get stopped out in a short-term panic in this sector.
We\u2019ve actually been adding, little by little, to our position in RYH, the Guggenheim Equal Weight S&P 500 tracking ETF. Once some resolution to the pharma issue is reached with the White House, these traditionally profitable high dividend payers should take off and never look back. True, right now they look pretty miserable, but when the fog lifts, they\u2019ll do just fine, meaning we can buy them\u2014or the ETF\u2014at depressed prices, always a good tactic.
We\u2019ve also taken a chance on drug maker Merck (MRK), which, at least in the near term, should do better than most of the rest.
Lest we forget our large position in Allergan Convertible Preferred A shares (AGN\/PRA, your symbol may vary), we got a pair of huge up-moves last week, although we\u2019re still down 3.3 percent at the moment. It\u2019s a proxy for the Allergan common (AGN) and we have enough of it already, so we\u2019re holding for now.
We continue to add to our small positions in a pair of gold and silver ETFs we can trade for zero commission at our brokerage, namely SGOL and SIVR, respectively.
That\u2019s it for today. Fingers crossed. If the market next intends to break through resistance, we\u2019ll probably know shortly. We hope it does, but you never know.<\/p>\n

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