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The U.S. weekly jobless claims number increased another 3.17 million people (versus the 3.05 million expected by economists) today. That brings the total to 33.5 million Americans unemployed over the last seven weeks.
Stocks shook off the news, however, as the Dow rallied 0.9%. The Nasdaq rose 1.4% as investors buy into technology stocks that are less likely to be affected by government shutdowns.
Oil was up 10% in the first half of trading, but closed down 3% in a volatile session. And interestingly enough, gold was up 2% while Bitcoin popped 6%. Typically, gold is negatively correlated to stocks and goes down when the market goes up.
Here's why our experts - Chris Johnson, D.R. Barton, Jr., and Shah Gilani - think stocks are likely to experience more pain to come. And why gold (and Bitcoin) might be the big winners over the next couple years...
- Chris revealed his "Best in Breed" stocks to buy now:
- The iShares Dow Jones US Home Const. (BATS: ITB) ETF, currently trading for $37. Chris thinks homebuilders are going to experience a pop for the next month or two.
- Home Depot Inc. (NYSE: HD), currently trading for $230. Chris experienced a 40-minute wait to get in the Home Depot by his house and learned that customers across the country are experiencing the same thing, driven by high demand. Chris has a $250 price target on HD.
- Trex Co. Inc. (NYSE: TREX), currently trading for $110. This stock was overbought right after earnings, but Chris thinks it's a good investment if you can get it for $100 per share.
- Fastenal Co. (NASDAQ: FAST), currently trading for $38. This is Chris' favorite industrial parts supplier, and he has a $45 price target on the stock.
- D.R. explained that oil is up today because Saudi Arabia announced increased prices on all grades for June.
- He thinks it's relatively expensive and facing resistance at about $25 per barrel.
- D.R. made some spot-on earnings calls yesterday and earlier in the week:
- He was bullish on PayPal Holdings Inc. (NASDAQ: PYPL) yesterday. The stock was up 13.5% after reporting earnings today.
- He was also bullish on Square Inc. (NYSE: SQ) yesterday, and that stock is up 10% today.
- D.R.'s bullish bet on Carvana Co. (NYSE: CVNA) two days ago also paid off with this stock up 6% today.
- He was bearish on Hyatt Hotels Corp. (NYSE: H) yesterday, and that stock's flat after earnings.
- And finally, he was bearish on Wynn Resorts Ltd. (NASDAQ: WYNN), which is also flat after earnings.
- Tune in tomorrow to see what earnings reports D.R. will be watching and betting on next week.
- Shah is concerned about the trend of unemployment caused by the coronavirus pandemic.
- He thinks it's possible that we'll hit 30% unemployment in the United States and that will drag on stocks until we have a working vaccine that's widely distributed.
- Shah is also concerned about the levels of household debt in the U.S.
- It increased 28.2% last quarter, and people's abilities to pay back their debt without jobs is a major concern.
- Shah thinks gold will continue its recent rally because interest rates in America are so low and have a chance of going negative in the near future.
- If rates go negative, that would be a clear sign to Shah that there are serious structural issues with the current economic system.
Catch us tomorrow - starting LIVE again at 8:45 a.m. EDT with Chris Johnson, right here.
If you missed our live streams today, you can now replay them on our YouTube channel, here.
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