Four Strong Stocks for the New Year


Despite the powerful gains in the major averages last week many investors are still on the sidelines and Moneyshow's Tom Aspray has four strong sector stocks that are ripe for new investment as we head into 2013.

The stock market may face its first real test of the New Year this week as the short-term overbought technical readings and general skepticism over last week's rally makes a correction likely.

The powerful readings from the weekly NYSE A/D line that I discussed in last week's Scaling the Wall of Worry indicates that the intermediate trend for the stock market is clearly positive. Therefore, stocks have the potential to rally quite a bit higher in the first quarter of 2013.

The market tracking ETFs like the Spyder Trust (SPY) were higher in December as SPY gained almost 3%, but some sectors did much better with the Select Sector SPDR Financial (XLF) up over 8%. Many stocks in the financial sector did even better as Bank of America (BAC) was up well over 22%.

Concentrating on the market leading sectors and more importantly the stocks in these sectors should allow you to be well-positioned for a first quarter rally in stocks.