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U.S. stocks closed higher on Mar 23 despite a volatile trading session, with gains from mega-cap stocks like Apple and Microsoft helping the tech-heavy Nasdaq climb northward. The S&P 500 and the Dow too finished higher and regained some of the losses from Wednesday’s selloff.
Investors were optimistic that the Federal Reserve will pause interest rate increases in the near term, which undoubtedly bodes well for economic growth. After all, interest rate hikes do impact consumer outlays and increase the cost of borrowing.
The Fed did raise interest rates by 25 basis points recently in an attempt to curb stubbornly high inflation. But policymakers in their statement did get rid of the term “ongoing increases” in interest rates. Instead, they mentioned that the Fed “anticipates that some additional policy firming may be appropriate.”
Fed Chair Jerome Powell this time urged market pundits to focus more on words such as “some” and “may”, and not necessarily on “policy firming.” His advice did assure investors that the central bank is likely to press the pause button on interest rate hikes.
The recent bank meltdown, by the way, is hurting broader stock market returns. Panics of a bank run compelled lenders to take less risk with their capital reserves to ensure they have sufficient cash to cover any slew of withdrawal requests. However, this could mean that banks will stop providing loans to business houses, and issue fewer mortgages leading to an economic cooldown and a slowdown in the housing market.
Notably, the Silicon Valley Bank collapsed due to bond-related losses linked with an increase in interest rates. Consequently, customers rushed to get money out of the bank, while the broader banking sector witnessed a similar withdrawal of funds after SVB’s breakdown.
But U.S. treasury secretary Janet Yellen reassured investors yesterday that bank deposits in the United States were safe and that policymakers do have the wherewithal to tackle any bank-related crisis. She confirmed that the federal government has applied the necessary tools to prevent contagion and is willing to apply such tools if required again.
Thus, Yellen’s effort to lessen investor fears about the banking-sector stability coupled with the Fed’s willingness to pause its interest rate hikes not only boosted the stock market now but will also help it to chug along in the near future. Given such positives, it's prudent for investors to place their bets on growth stocks.
We have, therefore, highlighted five stocks that carry a Zacks Rank #1 (Strong Buy) or 2 (Buy), and have a Growth Score of A or B, a combination that offers the best opportunities in the growth investing space. You can see the complete list of today’s Zacks Rank #1 stocks here.
Comfort Systems USA (FIX - Free Report) provides comprehensive heating, ventilation, and air conditioning installation, maintenance, repair, and replacement services. FIX has a Zacks Rank #1 and a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 5.5% over the past 60 days. The company’s expected earnings growth rate for the current year is 20%.
Hershey (HSY - Free Report) is the largest chocolate manufacturer in North America as well as a global leader in chocolate and non-chocolate confectionery. HSY has a Zacks Rank #1 and a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 4.3% over the past 60 days. The company’s expected earnings growth rate for the current year is 9.9%.
Wynn Resorts (WYNN - Free Report) is a leading developer, owner, and operator of casino resorts. WYNN has a Zacks Rank #1 and a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up more than 200% over the past 60 days. The company’s expected earnings growth rate for the current year is 119.5%.
Insulet (PODD - Free Report) is a leading developer, manufacturer, and marketer of the Omnipod Insulin Management System. PODD has a Zacks Rank #2 and a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 21.7% over the past 60 days. The company’s expected earnings growth rate for the current year is 1,742.9%.
Lattice Semiconductor (LSCC - Free Report) designs, develops, and markets high-performance programmable logic devices and related development system software. LSCC has a Zacks Rank #2 and a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 1.5% over the past 60 days. The company’s expected earnings growth rate for the current year is 18.3%.
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Fed Policy Pause & Yellen's Assurance Buoy Wall Street: 5 Picks
U.S. stocks closed higher on Mar 23 despite a volatile trading session, with gains from mega-cap stocks like Apple and Microsoft helping the tech-heavy Nasdaq climb northward. The S&P 500 and the Dow too finished higher and regained some of the losses from Wednesday’s selloff.
Investors were optimistic that the Federal Reserve will pause interest rate increases in the near term, which undoubtedly bodes well for economic growth. After all, interest rate hikes do impact consumer outlays and increase the cost of borrowing.
The Fed did raise interest rates by 25 basis points recently in an attempt to curb stubbornly high inflation. But policymakers in their statement did get rid of the term “ongoing increases” in interest rates. Instead, they mentioned that the Fed “anticipates that some additional policy firming may be appropriate.”
Fed Chair Jerome Powell this time urged market pundits to focus more on words such as “some” and “may”, and not necessarily on “policy firming.” His advice did assure investors that the central bank is likely to press the pause button on interest rate hikes.
The recent bank meltdown, by the way, is hurting broader stock market returns. Panics of a bank run compelled lenders to take less risk with their capital reserves to ensure they have sufficient cash to cover any slew of withdrawal requests. However, this could mean that banks will stop providing loans to business houses, and issue fewer mortgages leading to an economic cooldown and a slowdown in the housing market.
Notably, the Silicon Valley Bank collapsed due to bond-related losses linked with an increase in interest rates. Consequently, customers rushed to get money out of the bank, while the broader banking sector witnessed a similar withdrawal of funds after SVB’s breakdown.
But U.S. treasury secretary Janet Yellen reassured investors yesterday that bank deposits in the United States were safe and that policymakers do have the wherewithal to tackle any bank-related crisis. She confirmed that the federal government has applied the necessary tools to prevent contagion and is willing to apply such tools if required again.
Thus, Yellen’s effort to lessen investor fears about the banking-sector stability coupled with the Fed’s willingness to pause its interest rate hikes not only boosted the stock market now but will also help it to chug along in the near future. Given such positives, it's prudent for investors to place their bets on growth stocks.
We have, therefore, highlighted five stocks that carry a Zacks Rank #1 (Strong Buy) or 2 (Buy), and have a Growth Score of A or B, a combination that offers the best opportunities in the growth investing space. You can see the complete list of today’s Zacks Rank #1 stocks here.
Comfort Systems USA (FIX - Free Report) provides comprehensive heating, ventilation, and air conditioning installation, maintenance, repair, and replacement services. FIX has a Zacks Rank #1 and a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 5.5% over the past 60 days. The company’s expected earnings growth rate for the current year is 20%.
Hershey (HSY - Free Report) is the largest chocolate manufacturer in North America as well as a global leader in chocolate and non-chocolate confectionery. HSY has a Zacks Rank #1 and a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 4.3% over the past 60 days. The company’s expected earnings growth rate for the current year is 9.9%.
Wynn Resorts (WYNN - Free Report) is a leading developer, owner, and operator of casino resorts. WYNN has a Zacks Rank #1 and a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up more than 200% over the past 60 days. The company’s expected earnings growth rate for the current year is 119.5%.
Insulet (PODD - Free Report) is a leading developer, manufacturer, and marketer of the Omnipod Insulin Management System. PODD has a Zacks Rank #2 and a Growth Score of B.
The Zacks Consensus Estimate for its current-year earnings has moved up 21.7% over the past 60 days. The company’s expected earnings growth rate for the current year is 1,742.9%.
Lattice Semiconductor (LSCC - Free Report) designs, develops, and markets high-performance programmable logic devices and related development system software. LSCC has a Zacks Rank #2 and a Growth Score of A.
The Zacks Consensus Estimate for its current-year earnings has moved up 1.5% over the past 60 days. The company’s expected earnings growth rate for the current year is 18.3%.