Industrials Are Winning... Just Don't Look to the Dow

The Dow Jones Industrial Average isn't what it used to be... When the Dow launched in 1896, it featured 12 industrial companies. The index covered all types of American industry – including electricity, sugar refining, tobacco, lead, and more. [Chaikin PowerFeed]( Industrials Are Winning... Just Don't Look to the Dow By Pete Carmasino, chief market strategist, Chaikin Analytics The Dow Jones Industrial Average isn't what it used to be... When the Dow launched in 1896, it featured 12 industrial companies. The index covered all types of American industry – including electricity, sugar refining, tobacco, lead, and more. But that's no longer the case... Over the past 126 years, the Dow's heavy emphasis on American industry has changed dramatically. In fact, industrial stocks now only make up about 15% of the index. That's critical for investors to know... You see, industrial stocks are starting to look enticing right now. However, as I said, the Dow is no longer an industrials-focused index. So we can't use it to take advantage of this opportunity. Instead, we'll use a different investment today. And as you'll see, it's already running higher... Recommended Links: [Prediction 2023: Here's What You Missed]( Marc Chaikin unveiled a new cash vehicle 50 years in the making... made his biggest new prediction in 50 years... and explained how it could double or triple your money if you move your cash immediately. [Click here to watch (includes free recommendation)](. ['A Gold Storm is Coming']( Some of the richest men in the world are jumping in right now... because evidence suggests we could see MUCH HIGHER gold prices before the end of this year. But if you're not taking advantage of a little-known way to invest for less than $10, you're missing out. [Click here for full details](. In short, we'll use the Industrial Select Sector SPDR Fund (XLI). This exchange-traded fund ("ETF") holds shares of roughly 70 companies. And true to the ETF's name... all of its holdings are in the industrials sector. The good news for investors is that XLI has outperformed the S&P 500 Index this year. It's beating the benchmark index by about 11 percentage points in that span. However, the bad news is that XLI has been a losing investment overall in 2022. It's down about 6% this year. You can see what I mean in the chart below... [Chaikin PowerFeed] That likely seems disappointing to you. Why would I highlight a losing investment? Well, for starters, XLI's outperformance is now turning into big gains for investors. You can see what I mean on the right side of the chart... Since the end of September, XLI is up around 20%. The S&P 500 is only up about 11% over that period. Even better, the "smart money" is likely behind XLI's recent surge... Regular readers know the smart money includes Wall Street institutions and other power players. As the nickname implies, they typically know where to find the best opportunities. That's why it's great to fish in the same pond as the smart money. We can use the Power Gauge to confirm XLI's smart-money shift... Specifically, we can use the Chaikin Money Flow indicator. It tracks more than 5,000 stocks at any time. Let's use it today to look through XLI's top 10 holdings. These stocks are all likely familiar to you... [Chaikin PowerFeed] The Power Gauge currently rates seven of these 10 stocks as "neutral" or better in the Chaikin Money Flow factor. And it grades two of them – defense contractors Lockheed Martin (LMT) and Northrop Grumman (NOC) – as "very bullish" for this factor. Specifically, that tells us the smart money is looking at the defense subsector of industrials. It makes sense... From Ukraine to Taiwan, global tensions remain high today. And with close ties to the U.S. government, these companies help protect our country and allies. Overall, the Power Gauge rates XLI and Lockheed Martin as "very bullish." And it's "neutral+" on Northrop Grumman (which just means the stock is below its long-term trend line). Put simply... investors are turning to industrials right now. If you want a broad-based approach to the sector, consider XLI. These days, it's a much better option than the industrial-in-name-only Dow. And if you're looking for individual stocks, Lockheed Martin and Northrop Grumman could be great options as well. Good investing, Pete Carmasino Editor's note: Chaikin Analytics founder Marc Chaikin recently revealed Pete as his "secret weapon"... In short, Pete is a tactical specialist in the markets. He has combined his decades of technical trading expertise with the Power Gauge to find stocks with huge potential upside. Now, for the first time ever, he's sharing this knowledge with the masses... Pete joined Marc for a special broadcast earlier this week. Together, they explained exactly how this new investment vehicle could massively boost your wealth if you act now. For a limited time, you can watch the full replay of this event. And everyone who tunes in will learn a FREE recommendation directly from Marc. [Click here for all the details](. Market View Major Indexes and Notable Sectors # Hld: Bullish Neutral Bearish Dow 30 -0.04% 10 18 2 S&P 500 -0.76% 147 271 81 Nasdaq -1.36% 32 53 15 Small Caps -1.79% 597 871 415 Bonds +2.19% — According to the Chaikin Power Bar, Small Cap stocks and Large Cap stocks are somewhat Bullish. Major indexes are mixed. * * * * Top Movers Gainers [rating] TJX +5.18% [rating] CPB +3.89% [rating] WRB +3.82% [rating] LNC +3.60% [rating] LOW +3.01% Losers [rating] AAP -15.06% [rating] CCL -13.71% [rating] TGT -13.14% [rating] CTLT -8.63% [rating] BBY -8.57% * * * * Earnings Report Reporting Today Rating Before Open After Close KEYS, UGI BJ, M ROST, DLB, GLOB, GPS, POST, WSM, WWD KSS, PANW No earnings reporting today. Earnings Surprises [rating] PGR The Progressive Corporation Q3 $0.53 Missed by $-0.39 [rating] TGT Target Corporation Q3 $1.54 Missed by $-0.64 [rating] NVDA NVIDIA Corporation Q3 $0.58 Missed by $-0.12 [rating] TJX The TJX Companies, Inc. Q3 $0.91 Beat by $0.11 [rating] CPRT Copart, Inc. Q1 $0.51 Missed by $-0.05 * * * * Sector Tracker Sector movement over the last 5 days Information Technology +8.94% Communication +8.92% Discretionary +7.94% Materials +5.47% Real Estate +5.31% Utilities +4.37% Financial +4.13% Energy +4.10% Industrials +3.45% Staples +2.78% Health Care +1.20% * * * * Industry Focus Capital Markets Services 45 18 1 Over the past 6 months, the Capital Markets subsector (KCE) has outperformed the S&P 500 by +12.09%. Its Power Bar ratio, which measures future potential, is Very Strong, with more Bullish than Bearish stocks. It is currently ranked #2 of 21 subsectors. Top Stocks [rating] RJF Raymond James Financ [rating] IBKR Interactive Brokers [rating] HLI Houlihan Lokey, Inc. * * * * You have received this e-mail as part of your subscription to PowerFeed. If you no longer want to receive e-mails from PowerFeed, [click here](. You’re receiving this e-mail at {EMAIL}. 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