Monday was a flat day that felt good for the bulls on Wall Street, with the major averages rallying from morning lows to close near where they began after rallying for six straight weeks.
"This is the most unloved rally in history," says Raymond James' Chief Investment Strategist Jeffrey Saut, referring to the thick skepticism surrounding the rally of better than 10% in the SPY since June 1. In the Market Blaster video above, Saut talks about some of the stocks he likes at this stage of the rally, including Qualcomm, Johnson & Johnson and a timber REIT that's doing a good business in paper.
Technology stocks in the QQQ have continued to show strength, including the biggest. Apple rallied to and closed at a new all-time high of $665.15 per share, giving the company a $623.5 billion market capitalization, the highest market value now or ever for a listed company after topping Microsoft's peak valuation in 1999.
Facebook plumbed a fresh low at $18.75 per share before turning tail and rallying 5% higher on the day to close at $20 on volume that was double its daily average. Insiders have been selling Facebook stock since they became eligible to do so last week. Venture capitalist Peter Thiel sold more than 20 million share at prices between $19.27 to $20.69 last Thursday and Friday.
Facebook still trades for 40 times expected 2012 earnings. Analysts expect revenue to grow 30%. Bargain? Maybe not quite yet. Compare that to Google with a 15.8 P/E and revenue growing at 47% this year. Apple, too, sports a lean 15 P/E multiple and sales are expected to be up 44% in the year ended September 30.
