- why the market feels different this year; and
- why he's impressed by the strength of transportation and drug stocks.
This Year Has a Different Feel Posted at 2:58 p.m. EST on Friday, Jan. 11 Waiting for this market to get tired, waiting for it to show some sort of true colors. Let me give you some examples. The level of disappointment that I heard about Wells Fargo ( WFC) today was much more muted than last time around. In fact, people shrugged their shoulders, despite the run, and said "they are doing pretty well when you think about it." No throwing that one to the wolves. American Express ( AXP) is still up pretty nicely from where it was, even as they used terms like cautious consumer in their conference call, in part because the consumer turned out not to be that cautious. Ford's ( F) going higher again on the same news. That's highly unusual and positive. Microsoft ( MSFT) and Intel ( INTC) are both up after we found out that personal computer sales are down more than 6% last year. How can that be? Cummins ( CMI) was downgraded today. That stock goes down two, three, maybe four bucks on a downgrade. Not today. A buck and a half. Benign. Stocks go down. But it's not vicious. There are no freakouts. It's just not a forbidding market. Anything's possible when we get into the guts of earnings season next week, but consider this: The J.C. Penney ( JCP) downgrade was just punishing, horrid, left you breathless. The stock got pummeled at the beginning of the day. Now it's barely down! How can that be? So far, 2013 just doesn't feel like the last few years. Maybe it's because there is more money in. Maybe it's because if you are still in, you aren't easily shaken. You just expect more of a selloff than you get. But there are buyers underneath pretty much every day.
Blown Away by Transports, Drugs Posted at 3:30 p.m. EST on Thursday, Jan. 10 What do you call a market that's led by the transports, the drugs and the financials? Most people would call it a bull market. I have to tell you that I am blown away by the strength in the transports, even after a couple of huge downgrades of the rails because of the usual weakness in coal traffic. We actually have a sustained rally in the airlines, which I am blessing for a trade, especially Southwest ( LUV). As far as the drugs? I have spent a ton of time reviewing this group as part of my coverage of the J.P. Morgan Healthcare Conference. Between the growth offered by Celgene ( CELG), Gilead ( GILD), Regeneron ( REGN) and Biogen Idec ( BIIB) and the steady performance of owning Bristol-Myers ( BMY), Abbott Labs ( ABT), Sanofi ( SNY), Pfizer ( PFE) or even Eli Lilly ( LLY) (which swore up and down to me that its dividend and earnings will not be affected by the huge upcoming patent cliff), you can understand the love affair. The financials? This is a tough one. I like the regionals best, and I think that Bank of America ( BAC) represents a great call on housing. But Wells Fargo ( WFC) reports tomorrow and while I own it for the charitable trust, I was hoping it would sell off ahead of the quarter so if it grows its top line but doesn't make a lot of money off its net interest margin, it wouldn't get crushed. Didn't happen. The stock has rallied right into the quarter and, as I told Action Alerts PLUS subscribers, that's a nasty setup. I like the transports and the drugs right here. And there is always a chance, albeit a slim one, that Wells Fargo doesn't actually disappoint. Still, I think you will get better bargains on Monday than you will tomorrow if Wells Fargo disappoints because you will catch a slew of downgrades next week. That will be your opportunity. At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, was long BMY and WFC.