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hi i'm paul goodwin chief analyst for cabot china and emerging markets report and this is your cabot weekly review it's been an interesting week in the markets it's almost always an interesting week in the markets but the interesting thing this week is that the nasdaq which had been the strongest of the three major indexes had pushed out to new highs right here now you can see it's pulled itself back a little bit back toward 4,500 if you look at the sp500 here you can see that it has been basically trading netting out sideways and if i take this back here netting out sideways since februari or so and with the dow it's pretty much the same thing so markets are depends on what word you want to use you know floundering choppy can't get out of their own way what it reflects is that investors have no idea of what's going to happen they markets are always looking out six months or so ahead and investors don't know what's going to be happening six months from now I think three major reasons probably although it doesn't really matter what the reasons are but one nobody knows what's going to happen with Greece you don't know if they're I mean talks are probably going on even as I'm talking although they're not listening to decide whether Greece is going to get you know renegotiated or if it's going to default if it default if it's going to leave the leave the eurozone and nobody knows exactly what the fallout from that will be second thing is China is you know unwinding a little bit of speculative excess right now nobody knows what the world's second largest economy is going to be doing in terms of GDP growth and there are some you know all kinds of problems there the third elephant in the room is that everybody knows that the Fed is going to be raising interest rates sometime but they don't know when and they don't know by how much so what you see the result of all this is this massive up down a kind of confusion so it's a we've been saying it's a stock pickers market for a while and what we mean by that is it's not a time when you're going to be making a lot of money by being in the indexes and you're not going to be protecting yourself from this kind of choppy up and down this if you're looking to make money in this market you need to find leading stocks so let's take a look at a few and why here's Charles Schwab this is a daily chart you can see on the weekly chart that Schwab which is an investment broker business started start it up in you know late-2012 then leveled off for quite a while go back to the daily chart you can see that since january or so it's been doing quite well and the reason for this and the reason several financials are doing well is that everybody knows that with the massive amounts of capital it's WOB has under management if interest rates go up they make more money just automatically and so that's the kind of thing that you know an increase in assets without an increase in cost margins going to do well and people like that on a smaller scale here's signature bank s bny signature bank of new york a bank that has been doing well by sticking strictly to a small geographical area where it really knows the business and sticking to a particular segment of the real estate business so you can see in this just beautiful take off here you can see that people are enjoying the prospects recipe and why so and again you understand why it's happening you see that that that beneficial effect of the possibility of interest rates rising is reflected across the industry so what you look for is the the best stocks in that industry and I think these are a couple of them in a different industry talk about your headline business palo alto networks is a online security network security business one of the leaders and i think if you say that every time there's news of a headlines reflect a new intrusion into a computer system Palo Alto Networks does well well you'd have to say they have been this is the daily chart look at the weekly you'd have to say they have been doing well for quite a while you love this sort of long term long term strength that completely ignores what the market is doing and if you look at this beautiful William O'Neal direct access chart here this is the relative performance line showing how Palo Alto Networks has been doing versus the broad market there is absolutely nothing wrong there and so this is a you know a leading company in a in a good industry fireEye's same business very different chart partly because this is a much younger stock is kind of sort of standard you know IPO here trades at the end of its first day here vaults higher and then goes into this kind of post IPO droop as people kind of ring the excess out splits the difference between its IPO price and its first day clothes re basis here and now going back to the daily chart you can see beginning to pick up some little high volume spikes indicating that people are picking the stock up and this is one we like in in in almost the health care industry but not quite this is alumina which has for years been a leading stock probably the leader in intellectual capital in DNA sequencing that sort of thing genetic analysis and a very very solid company that has been doing well over a long period of time but you know after the problem is they're too well-known probably and so it gets you know it gets periods like this when nothing much happens but you know recently has taken off well and that's the kind of chart you like to look for when markets are choppy and sideways much more speculative but probably more active in the monetization of genetic engineering this isn't Rex on and they are helping companies to let's face it they're doing you know genetic engineering that sort of thing not our favorite thing necessarily but you you can't you can't argue with you know this kind of trend so but it has again exactly what we're looking for strong industry strong company and we like this pretty well fourth industry is pharmaceuticals and here's a Meg pharmaceuticals this is if you're if you're not playing around in the growth end of things this is the kind of chart that just kind of make your jaw drop you know massive blast offs on high volume and you know just just kiting higher staying in a channel and and into stock like this these shake outs take out the weak hands and if you're holding on and have a profit margin that allows you to stay in it sometimes time is the thing that will help you the most so you know a meg has done some lovely shake outs and then continued continued hire we like this a lot and finally ligand pharmaceuticals much shorter period of prosperous prosperity than that a Meg but you know out of a beautiful bass classic blast off on high volume and then heading higher holding on to its you know the the upside and then the lower side of its trend line and is well on top of its 25 and 50 day moving averages so those are for industries that I think are doing well and it's those are the kind of stocks you ought to be looking for and if you would ever like any help in finding stocks like these you can always find us at wkbt net and we will see you next week thanks you