Raymond James' Strategist Jeff Saut: Watch the US Dollar ~ market folly

Monday, January 11, 2010

Raymond James' Strategist Jeff Saut: Watch the US Dollar

Jeffrey Saut, Chief Investment Strategist for Raymond James is back with his weekly market commentary. This week's investment strategy entitled, "Predictions?!" focuses on Saut's commentary about recent economic data and things to watch for this year.

As it pertains to the markets, Saut says, "Dynamically, participants should still be long half of the index trading positions recommended months ago, but with close trailing stop-loss points. Strategically, we think it is appropriate to hedge, or harvest, partial positions in the investment account." We would agree with him here because not only are we proponents of running a hedged book, but it never hurts to lock in some gains or protect them with stop-loss triggers.

Turning his focus to new investments, Saut highlighted three specific stocks taken from their Analysts' Best Picks list. From that list, he singled out shares of CVS Caremark (CVS), National Oilwell Varco (NOV), and Alpha Natural Resources (ANR) as stocks they think will perform well.

Lastly, Saut points out that the rally in the US dollar has been a major development since it was such a swift and large move. However, the dollar has since weakened a little bit and money has started to flow into "stuff" stocks (i.e. commodities). He notes that if the recent weakness in the dollar is a 'headfake' and if the dollar strengthens again that, "it has significant implications for the various markets." We'll have to wait and see what develops in that regard. You can download Saut's full investment strategy via .pdf here.

For more from Jeff Saut, check out his 2010 market outlook as well as his commentary from last week, 'lessons learned.'

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