Premium: The Veterans' Stocks To Watch

David asked me to have a dig around and find some stocks that I look the look of.

To be honest, I have been looking at equity markets at index level recently rather than focusing on specific individual names.

I wanted to observe how the market reacted to bumper Q1 earnings in the US and Europe... The answer to that?

Equity indices have largely shrugged off the earnings news with the figures effectively just washing over the major indices: to my mind that’s not a positive sign for markets as a whole.

Of course, and as some of my old-time colleagues were fond of saying we are in a market of stocks rather than stock markets... which means we can look for outliers & idiosyncratic behaviour to create a list of interesting names and stocks to watch

Using the model that I have followed for the last 15 years, we measure ranks, scores, prices, action in stocks sectors and indices allowing the user to make comparisons between those groupings.

One of the most useful comparative metrics in the system is trend strength which tells us just how strongly a stock is performing within its current bullish or bearish trend.

When compared to its peers the scoring system for trend strength runs between -21 and +21 with the strongest bears at the lower end of that range and strongest bulls at the upper end.

At the midpoint between those two extremes we find weak bulls and weak bears i.e. stocks which have the potential to change trends - the model is maths-driven & very black and white in its outlook.

For every stock there is a price point at which its current trend would end and new and opposite trend begins.

Stocks move from bull to bear or bear to bull at or through that price point (known as the stop.)

From a universe of Euro Stoxx 600 names, I have created two tables which I have set out below.

The first table contains the Strongest Strong Bulls.

These stocks have the most bullish trend strength score of +21 and have positive performance over year to date, weekly, and daily time scales.

These stocks have demonstrated upside price momentum and continue to do so.

In our first group, we find names involved in transportation and logistics such as Maersk, Kuehne and Nagel and DSV.

We also find high end and luxury goods in the shape of Richemont, Swatch and Pandora. 👇

In our second table (the CounterTrending Bears) I have screened the universe for weakest bear trends with trend strength scores of -3 or +1 and which also have positive price performance over our three timescales.

Effectively these are bear trends that really want to play on the other team i.e for the bulls.

They will get to that as and when they reach and pass through their stop prices.

All of the stocks in these tables are worth watching from here however I have highlighted three that really speak to me.

Plumbing and building supplies group Ferguson, BT Group and ITV.

• Ferguson is directly exposed to the US housing market and Joe Bidens efforts to stimulate the economy through spending on infrastructure.

• BT Group is undergoing a re-rating having found a solution to the issue of its pension fund liabilities and how to meet them

• ITV is experiencing a rebound in advertising revenues and could also find itself becoming a takeover target (something that could also happen at BT.)