Stocks Soared Yesterday, Turn Positive For The Week

Plus 5 New Strong Buys for Today Stocks Soared Yesterday, Turn Positive For The Week [Kevin Matras - EVP - Photo] Profit from the Pros By Kevin Matras Executive Vice President Stocks Soared Yesterday, Turn Positive For The Week [Stocks Soared Yesterday, Turn Positive For The Week]Image: Bigstock Stocks soared yesterday with all of the major indexes up nearly 2% or more. Last week's interest rate hike, and the Fed raising their target rate to as high as 4.6% by early next year, has been weighing on the market ever since. Stocks appeared oversold since late last week. But they still kept falling. But yesterday, the market got the snapback it's been waiting for. The next thing traders will be looking for is a follow-through day. That means another rally of 1% or more. By definition, the strongest follow-through days come between days 4 and 7. So that means sometime next week. That doesn't mean we can't go higher today or tomorrow. But we should definitely be looking for something substantial next week too. In the meantime, in order for the follow-through day to mean something, the market should not take out the previous lows. In other news, MBA Mortgage Applications fell -3.7% with purchases down -0.4% and refi's down -10.9%. The Pending Home Sales Index fell -2.0% m/m at 88.4. Retail Inventories were up 1.4% m/m. Wholesale Inventories rose 1.3%. And the State Street Investor Confidence Index gained 1.5 points to 108.8 from last month's 107.3. Asia was up 7.7 points at 100.1. North America was up 2.4 points at 109. Although, the European component fell -5.5 points. Today we'll get the final estimate for Q2 GDP. The last estimate was -0.6% with Personal Consumption Expenditures up 1.5% annualized. The consensus is for the same. We'll also get Weekly Jobless Claims, and Corporate Profits. And everybody will be watching to see how Florida fares as hurricane Ian makes landfall. Yesterday's sharp rally was welcomed news. The big test now is if the market can build on these gains. With plenty of economic positives in the economy right now, not the least of which is a strong labor market, strong earnings, strong consumer spending, and strong GDI growth, there's definitely the chance that the market is being too pessimistic. Couple that with S&P valuations at multiyear lows (and trading below their 5-year average), and stocks begin to look cheap. To read more about why stocks might be in for an end of year rally, be sure to read our latest commentary... [Is The Market Too Pessimistic?]( Best, [Kevin Matras - Signature] Kevin Matras Executive Vice President, Zacks Investment Research [Just Released: 4 Stocks for Biggest Upside in Q4]( Four Zacks experts each announce their single favorite stock to gain the most in the next three months: Stock #1: Little-known but highly influential tech stock with clients like Apple and Nvidia. Stock #2: Cutting-edge streaming company ready to break out. EPS estimates are up 25% in 30 days. Stock #3: An under-the-radar alternative energy company with estimates for 70% in topline growth. Stock #4: Chemical company poised to become the dominant supplier of materials for EV batteries. Today, you are invited to download the private Ultimate Four Special Report that names these stocks and spotlights why their gain potential is so exceptional. [See Stocks Now »]( Most Popular Articles from Zacks.com [Bet on These 4 Biotech Stocks With Bright Prospects]( New drug approvals and pipeline development should maintain momentum for the Zacks Biomedical and Genetics industry. [Read More »]( [Check Top 3 Bets From Transport Equipment & Leasing Industry]( These industry prospects are bolstered by strong trade volumes and upbeat container demand. 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