We see what we believe are some great opportunities right now in Healthcare -- and we like the sector overall. Argus Director of Research Jim Kelleher, CFA, recently completed his quarterly sector review and raised Healthcare sector to Over-Weight from Market-Weight. The healthcare environment is undergoing rapid transitions, and we now see an unfolding period of significant promise and opportunity. Our newly-favored stance is based on resumption of deferred medical procedures and significant new quality-of-life drugs and treatments. The category is broad and has underperformed the S&P 500 over the past year. The Healthcare sector ETF (XLV) is up 15% over the past year compared to a gain of 31% for the S&P 500. We see opportunity here to pick up some steady companies, with big brands and solid financials. These companies are science-focused and enhance lives. They are innovators. In our list this week, we look across several subsectors within the Healthcare sector and pull out some leaders we like. These stocks also are included in our Focus List and Model Portfolios, as noted below.

Almost two months in 2024, and stocks have seen more recovery highs and the major indices have seen more all-time highs. The S&P 500 (SPX) rose 1.7% in the week ended February 23, the S&P 100 popped 1.9%, the Nasdaq and the Nasdaq 100 added 1.4%, the S&P 400 tacked on 1%, and the Russell 2000 lost 0.9%. For the SPX, the '100,' and both Nasdaq indices, the week was the fifteenth of 17 on the upside; it is 14 of 17 for the '400.' During the 17 weeks, the SPX has gained 23.6%, while both Nasdaq indices are up over 26%. Those are great returns for a full year!

Dividend income is often overlooked amid gyrations in the stock market. But dividends are an important element of return. Dividend income accounted for 42% of the total return of the S&P 500 between 1930 and 2012, according to Hartford Funds. And that's just the average. In some of those decades, dividends accounted for more than 50% of total returns and even 100% of returns. More recently, dividends have accounted for a smaller portion of returns, at around 15%-20%. Not all dividends are created equal, though, and it is important to understand the difference between the two main categories: high-yield stocks and dividend-growth stocks. High-yield stocks typically have dividends that pay out in the 5%-8% range. Though the income appears attractive, the share prices of high-yield stocks may be at risk. Dividend-growth stocks typically have lower yields, often in the 1.0%-2.5% range. But the lower-yielding dividends are not likely to be a huge component of cash flow, leaving management teams with other value-additive options for deploying cash. Further, while the yields are not as high, management teams may be more likely to boost the payouts over time, as earnings grow.

Management's ability to "raise guidance" can often be a catalyst for market-beating returns in the quarters ahead. The third-quarter earnings season is wrapping up, with blended earnings (actual results and the consensus for those still to report) showing a 6.3% gain, year-over-year, according to Refinitiv. That is considerably better than the 1.0% expected at the start of the earnings period, and should be enough to end the "earnings recession" that investors have endured over the past three quarters. Propelling the 3Q outperformance were strong gains in Communication Services, up 46%, while Energy again (like last quarter) is performing the worst, down 33%. Our analysts are always on the lookout for companies that boost their outlooks during earnings season. Here is an initial list of BUY-rated companies in Argus Coverage at which management raised guidance or increased its outlook during the 3Q23 EPS reporting season.

Monday Tee Up: Earnings and Powell

The 10-year Treasury yield finished at another recovery high of 4.99% on Thursday, as did the five-year yield, which closed at 4.96%. The two-year yield was flat at 5.16%, having hit a new recovery high Wednesday. The yield curve (two/10 spread) is at -17 basis points (bps) after hitting a low of -108 bps on July 3 and March 8 of this year. The move to reinversion has been dramatic since September 20, when the curve was -77 bps.

At the lows this week, the S&P 500 (SPX) fell right to the bottom of its bullish channel that started in October. In addition, the index hit the lower part of its very short-term channel off its late-July highs. With the market oversold and at support, it would not be surprising to see a counter-trend rally, but we are leaning toward a failed rally and then another leg lower.

It's all about the Fed this week, with a rate decision coming off fresh inflation data that showed an uptick in prices for the second month in a row. As well, the automakers strike is underway and a few more earnings reports will trickle in. Last week, the Dow Jones Industrial Average ended the week higher by 0.1%, the S&P 500 lost 0.2%, and the Nasdaq shed 0.4%. Year-to-date, all the major indices are still higher, with the DJIA up 4%, the S&P 16%, and the Nasdaq 31%.

Despite a strong equity market for most of 2023 (especially since the March low), we have seen numerous days when the major indices all fell at least 1%, -- with most of those prior to April. The S&P 500 (SPX), the Nasdaq, and the Nasdaq 100 (QQQ) all gave back about 1.1% on Tuesday, while the S&P MidCap 400 (MDY) and the Russell 2000 (RUT) fell 1.3%. Overall, that was not close to being a terrible day. But we did see some abysmal results in market breadth statistics.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

This pick list highlights constituents of the Morningstar US Large Cap Index that we believe offer investors the best risk-adjusted return prospects. Stocks of large-cap companies where neither growth nor value characteristics predominate. Stocks in the top 70% of the capitalization of the U.S. equity market are defined as large cap.

This pick list highlights constituents of the Morningstar US Large Cap Index that we believe offer investors the best risk-adjusted return prospects. Stocks of large-cap companies where neither growth nor value characteristics predominate. Stocks in the top 70% of the capitalization of the U.S. equity market are defined as large cap.

Monday Tee Up: Inflation and GDP

In this edition, global oil inventories face future; feeling the internet's backbone; and initiating coverage of Qualys; and Lithium Americas, Bausch & Lomb and Macy's.

In this edition, railroads may be in for a bumpy ride; ESG has some opportunities; biotechs innovate; and Constellation Brands, Autodesk, and Tencent.

In this edition, railroads may be in for a bumpy ride; ESG has some opportunities; biotechs innovate; and Constellation Brands, Autodesk, and Tencent.

Monday Tee Up: Heavy on Earnings, Light on the Economy

Stocks were mixed on Friday morning after big banks reported. Tesla stock was down when it announced that it was cutting prices on some of its models. According to the University of Michigan, consumer sentiment rose to 64.6 in January from a revised 59.7 in December. However, this is still well below prepandemic numbers The Nasdaq is down 0.27%, the S&P 0.22%, while the Dow Jones is up 0.17%. Crude oil rose to $79 per barrel, while gold rose $16 to $1914 per ounce.

The downtrend in the U.S. Dollar Index, as well as the entire Treasury yield, continues -- with the clear beneficiary being silver. On the other side of the commodity spectrum, crude oil remains in a steep bear market. The U.S. Dollar Index has declined 9% from its intraday high on September 30, while the 10-year yield is at a critical point near 3.5%. A break of this yield region could open the door to 3% or lower on the 10-year.

Stocks continued to drop on Friday morning on interest rate and recession fears, led by sharp declines in the Energy, Materials, and Consumer Discretionary sectors. Goldman Sachs cut its year-end target for the S&P 500 by 16% to 3,600, citing a higher than previously expected path for interest rates. On the earnings front, Costco posted better-than-expected fiscal 4Q results, though the shares fell on concerns about declining gross margins. The Dow fell 1.4%, the S&P 1.7%, and the Nasdaq 1.9%. Crude oil dropped more than 5% to $79 per barrel, while gold traded near $1653 per ounce.

Stocks continued to drop on Friday morning on interest rate and recession fears, led by sharp declines in the Energy, Materials, and Consumer Discretionary sectors. Goldman Sachs cut its year-end target for the S&P 500 by 16% to 3,600, citing a higher than previously expected path for interest rates. On the earnings front, Costco posted better-than-expected fiscal 4Q results, though the shares fell on concerns about declining gross margins. The Dow fell 1.4%, the S&P 1.7%, and the Nasdaq 1.9%. Crude oil dropped more than 5% to $79 per barrel, while gold traded near $1653 per ounce.

The Vickers Top Buyers & Sellers is a daily report that identifies the five companies the largest insider purchase transactions based on the dollar value of the transactions as well as the five companies the largest insider sales transactions based on the dollar value of the transactions.

Markets have faced difficult times before, with challenging economic environments, wars, disease, banking and housing crises, and inflation much worse than we are seeing now, to name but a few. Of late, stock investors had it very good for a very long time -- but now, finding opportunities requires much more work. There is no secret sauce, but there are principals that are worth reviewing: 1) diversify; 2) look for strong management; 3) look for solid balance sheets; 4) do your homework; and 5) adapt. To assemble this week's list, we looked across several sectors that historically are considered to be the most-shielded from high inflation and high interest rates. We then cross-referenced our coverage universe for companies where our analysts recently raised target prices; that have an Argus Financial Strength rating of at least Medium-High; and that pay dividends of least 3%. Some companies also are featured in our model portfolios (Growth & Income, Equity Income, Growth, and Institutional). Here is our list of companies we believe to be recession-proof, all of which are rated BUY at Argus.

April Deluge: Our Monthly Survey of the Economy, Interest Rates, and Markets

Stocks have slumped so far in 2022, as rising interest rates have compressed valuations and the Russian invasion of Ukraine further stoked inflation fears. Bond prices have also fallen on inflation concerns, and yields are higher versus year-end 2021. Our Stock-Bond Barometer model is close to equally balanced between stocks and bonds for long-term investors. In other words, these asset classes should be near their normal weights in diversified portfolios. We are now balanced on large- and small-caps. We favor large-caps for growth exposure and financial strength, while small-caps are selling at historical discounts relative to large-caps and offer value. Our recommended exposure to small- and mid-caps is now 15%-17% of equity allocation, in line with the benchmark weighting. U.S. stocks have outperformed global stocks over the trailing one- and five-year periods. We expect this long-term trend to continue, given volatile and often difficult-to-predict global economic, political, geopolitical, and currency conditions. That said, international stocks offer favorable near-term valuations, and we target 5%-10% of equity exposure to the group. Value has taken an early lead in 2022 due to the negative impact of rising rates on growth valuations. Over the longer term, we anticipate that growth, led by Tech and Healthcare, will continue to top returns from value, led by Energy and Materials, given favorable secular and demographic trends.

Value stocks -- a market segment that includes high-yield stocks -- are outperforming growth stocks in 2022. For the past decade, the performance record has favored growth, but the tide may be turning. The rollout of COVID-19 vaccines has given a lift to some of the cyclical companies (energy companies and regional banks) that have lagged in recent quarters, and value stocks have kept up the pace with growth stocks in the past year. Now, the Federal Reserve is poised to lift interest rates to fend off inflation, which will likely cap multiple expansion for growth companies. Regardless, the value sector is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 1.6%, compared to the 0.5% current yield on the iShares Russell 1000 Growth Index ETF. For our High-Yield Theme Model Portfolio, we are seeking stocks with yields of at least 3.0%. This moves us deep into the value segment of the market.

Stocks fell on Thursday morning, but pared sharper early losses, as investors continued to watch the unfolding crisis in Ukraine. Russia launched a large-scale military attack on the country early Thursday morning, with shelling of the Ukrainian capital and other major cities. The attack ended weeks of diplomatic efforts to end the standoff. The U.S. and other Western countries are expected to announce additional sanctions on Russia later today. The Dow fell 1.8%, the S&P fell 0.9%, and the Nasdaq was flat. Crude oil jumped more than 6% to $98 per barrel, while gold rose $28 to $1939 per ounce.

This edition features our annual pharmaceutical pipeline, a fresh look at Barry Callebaut's chocolate operation, the buzz around RingCentral, and SAP, Subsea 7, and Just Eat Takeaway.

This is among our most-important themes for 2022, and stretches across industries. We think companies that raise their dividends consistently at a double-digit rate are sending off three important signals amid all the recent market volatility: 1) the company's balance sheet is strong enough to pay a dividend; 2) management is focused on providing shareholder returns; and 3) management is confident enough in the near-term outlook to raise the payout aggressively. This third factor is especially important as the pandemic upends the nation's recent record of long-term economic growth. Here are 12 stocks that meet our double-digit dividend test and are on the Argus BUY list. They are also holdings in our Dividend Growth Separately Managed Account and in the Dividend Growers Total Return Trust, sponsored by SmartTrust.

The stock market moved slightly lower last week as investors eyed inflation metrics and earnings season slowed down. Tech stocks performed similarly to blue chips on the week. During Friday's session, the Dow Jones Industrial Average increased 179 points, or 0.50%. The S&P 500 was up 0.72%, and the Nasdaq Composite was up 1.00%. For the week, the DJIA was down 228 points, or 0.63%, the S&P 500 was down 0.31%, and the Nasdaq Composite was down 0.69%. Year-to-date, the DJIA is up 17.95%, the S&P 500 is up 24.67%, and the Nasdaq Composite is up 23.06%.

In recent weeks, yields have headed higher across the curve. The Treasury curve (two-year/10-year spread) steepened from 110 basis points on September 1 to 124 basis points at month-end. The three-month T-bill ranged between 0.03% and 0.06% in September, at the low end of Fed's federal funds target range of 0.00% to 0.25%, but matching the rate of the new Fed overnight program. Institutions remain flush with cash, as evidenced by the barely positive return, and the Fed continues to finance additional purchases in the repo market. The two-year Treasury yield moved higher during the month, rising to 0.28% at month-end from 0.20% on September 1. At the longer end of the yield curve, 10-year yields marched higher, yielding 1.30% on September 1 and closing the month at 1.52%. Real 10-year yields (10-year Treasury/10-year TIPS) ended September at -0.85%, improving from -1.03% at the beginning of the month, reflecting the divergent opinion in long-term real rates and inflation expectations. We continue to expect that interest rates will head higher, back to more-normal valuation levels, as the threat of the pandemic recedes. Our year-end 2022 targets for the 10-year Treasury bond yield is 2.25%. We anticipate that the Federal Reserve will hike short-term interest rates one time in 2022. For more information on specific strategies to take advantage of the interest-rate environment, see our Fixed Income Strategies report.

Value stocks are outperforming growth in 2021 (for the first time since 2016), though a recent rally in growth stocks has narrowed the performance advantage for value. But in an environment of historically low interest rates, many investors are still searching for high levels of income, which often can be found in value stocks. During recent years, the performance record has favored growth. Since 2010, the Russell 1000 Growth Index has climbed more than 450%, compared to an advance of 180% for the Russell 1000 Value Index. In eight of the past 10 years, growth stocks have topped value stocks. That hasn't always been the case. In the previous decade, including the Great Recession, value stocks were better performers than growth stocks, advancing an admittedly low 8%, but still better than growth, which declined 15% during the decade. Value investors trace their roots to the famous "Security Analysis" textbook, written by Ben Graham, an economics professor at Columbia University. Warren Buffett was one of his students. The tide may now be turning. Progress on COVID-19 vaccines has given a lift to some of the cyclical companies (energy companies and banks) that have lagged in recent quarters, and value stocks have kept pace with growth stocks in the past year. In any event, value is the place to achieve income. The current yield on the iShares Russell 1000 Value Index ETF is 1.6%, compared to the 0.5% current yield on the iShares Russell 1000 Growth Index ETF. This is important, as the current yield on the 10-year Treasury bond is 1.30%. For our list this week, we have screened our coverage universe for stocks that are BUY-rated by Argus Research analysts, have an Argus Financial Strength rating of at least Medium, and have a yield of 3.0% or higher. New stocks in our portfolio include the following.

Value stocks are outperforming growth in 2021 for the first time since 2016. While a recent rally in growth stocks has narrowed the performance advantage for value in the year to date, an environment of historically low interest rates is one in which many investors are still searching for high levels of income -- which often can be found in value stocks. When we look for attractive high-yield/deep-value stocks at Argus, we look for low valuations on metrics such as price/earnings, price/sales, price/book, yield, and price/cash flow. We also look for companies with clean balance sheets, high levels of profitability, high-quality earnings, and experienced management teams. We seek to avoid companies in industries that are in secular decline, or with dividend yields that are so high that the payout is clearly at risk. Based on numerous requests from clients, we have designed a portfolio of companies that are BUY-rated at Argus Research, have a Financial Strength rating of at least Medium, and have a yield of 3.0% or higher.

Stocks edged higher on Thursday afternoon, led by the Healthcare and Technology sectors. On the employment front, first-time jobless claims fell to 375,000 for the week ended August 7, down from the prior week and in line with the consensus forecast. Continuing claims fell to 2.866 million from 2.980 million a week earlier, and were also below consensus. After the close, Disney posted strong fiscal 3Q results, helped by better-than-expected growth in Disney+ subscribers and a recovery in the theme parks business. The Dow rose 0.04%, the S&P 0.30%, and the Nasdaq 0.35%. Crude oil fell to $69 per barrel, while gold rose slightly to $1755 per ounce.

The onset of the coronavirus in 2020 knocked the stock market into a bear market. Though stocks have recovered, the U.S. economy is about to slow down and COVID-19 cases are rising again as virus variants spread. Volatility, which has dropped from the highs of 2020, still has not returned to pre-COVID levels. Daily prices can swing wildly, as they did during two consecutive days in mid-July when the Dow Jones Industrial Average plummeted more than 1,000 points. Yet investors exit the stock market at their own peril, as long-term returns from equities consistently have outpaced long-term returns from other asset classes. Argus believes that Min Vol is an all-weather strategy that is timely in any investing climate and can deliver market-matching returns on an absolute basis and superior returns on a risk-adjusted basis over various time periods.

Stocks finished mostly higher on Thursday, but gave up most of their early gains in afternoon trading. On the employment front, first-time jobless claims fell to a new pandemic era low of 406,000, down from the prior week and below consensus. Continuing claims also fell to 3.642 million, down from 3.738 million a week earlier and below the consensus forecast of 3.68 million. Housing data disappointed. The National Association of Realtors said that its pending home sales index fell 4.4% in April to 106.2. The reading reflected the low inventory of homes available for sale and came in below the Reuters consensus forecast, which called for growth of 0.8%. The Dow rose 0.41%, the S&P rose 0.12%, and the Nasdaq fell 0.01%. Crude oil fell nearly 1% to $67 per barrel, while gold fell $3 to $1901 per ounce.

The S&P 500 hit four areas of support on Wednesday and bounced. They include chart support from the recent low; the 50-day average; trendline support off the lows since October; and trendline support (former resistance) off the peaks since February. The 21-week EMA is down at 3,973, while lateral chart support lies near 3,980. A 38.2% retracement of the rally since March targets 4,040, while a 50% giveback is near 3,980.

Often overlooked amid gyrations in the stock market is dividend income, which is an important element of total return. Between 1930 and 2012, dividend income accounted for 42% of total return of the S&P 500, according to Hartford Funds. And that's just the average. In some decades, dividends accounted for more than 50% of total returns and even 100% of returns. More recently, dividends have accounted for 15%-20% of returns. Still, in 2018, dividend payments softened the blow when most market indices declined as the Federal Reserve hiked rates. Not all dividends are created equal, though, and it is important to understand the difference between the two main categories: high-yield stocks and dividend-growth stocks.

The tone of the stock market over the past two days has definitely been risk off. That actually started late last week, but was overshadowed by new all-time highs (ATHs) on Friday for the S&P 500, the Dow Industrials, the Nasdaq 100 (QQQ) and the S&P 400 Mid-Cap (MDY). Leadership of late has been weighted heavily toward defensive sectors, but often that is just a function of a pullback during a bull market.

Stocks rose strongly on Thursday amid optimism over the administration's stimulus plan and improving employment data. The Labor Department reported that first-time claims for state unemployment benefits fell to 712,000, below the consensus forecast and the lowest reading since early November. Continuing claims of 4.144 million also fell from the prior week and came in below the consensus estimate. New coronavirus cases continued to fall in the U.S. and vaccine news was positive. Pfizer/BioNTech said that they would exceed their vaccine production target by as much as 20% this year, and reported that their shot was 94% effective in preventing asymptomatic infection. The EU also approved the Johnson & Johnson vaccine. The Dow rose 0.58%, the S&P 1.04%, and the Nasdaq 2.52%. Crude oil rose to $66 per barrel, while gold rose slightly to $1723 per ounce.

The onset of the coronavirus earlier this year knocked the stock market into a bear market. Though stocks have recovered, the U.S. economy is still in recession and COVID-19 cases are spiking as the weather turns colder and people head indoors. Volatility, which was low in early 2020 after a robust year for equities in 2019, has spiked higher, and has remained elevated. Is it time to cash in the chips? We note that investors exit the stock market at their own peril, as long-term returns from equities consistently have outpaced long-term returns from other asset classes such as fixed income and cash. As well, those returns are from eras when the 10-year Treasury bond yield was not sub-1.0%. So what's a potential equity strategy for investors amid all the uncertainty? Argus believes that Min Vol is an all-weather strategy that is timely in any investing climate. Academic literature and, more to the point returns history, indicate that Min Vol can deliver market-matching returns on an absolute basis and superior returns on a risk-adjusted basis over various time periods. Stocks included in our Min Vol model portfolio and typically industry leaders and have received a high score from our A6 Quant Model on Financial Strength and a low score on Risk. Stocks in the portfolio include the following.

Stocks fell on Tuesday morning amid new retail sales and manufacturing data, a day after rallying on the Moderna vaccine announcement. The Commerce Department said that U.S. retail sales rose 0.3% in October, down from 1.6% growth in September and below the Reuters consensus forecast of 0.5% growth. Meanwhile, the Federal Reserve reported that manufacturing production rose 1.0% in October, up from 0.1% in September and in line with the consensus forecast. The Dow fell 1.0%, the S&P 0.7%, and the Nasdaq 0.3%. Crude oil traded near $41 per barrel, while gold fell $2 to $1886 per ounce.