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Will Buys By Top Funds Revive These Growth Stocks?

On Sept. 30, as selling pressure continued, the Market Pulse in The Big Picture noted that the indexes had fallen into a correction. Led by Google parent Alphabet (GOOGL), the best mutual funds showed particular demand for technology, medical, energy, and financial stocks.




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The latest list of new buys and sells by leading money managers is based on the close of trading that same day. In the second half of the week, tech and growth stocks began to bounce back in an attempt to shake off the selling pressure.

In addition to GOOGL stock, the best mutual funds also picked up shares in Nvidia (NVDA), Palo Alto Networks (PANW) and Applied Materials (AMAT).

Intuitive Surgical (ISRG), Thermo Fisher Scientific (TMO), Danaher (DHR) and Bio-Techne (TECH) garnered strong demand within the medical sector.

On the financial front, Intuit (INTU), American Express (AXP), SVB Financial (SIVB), Bank of America (BAC) and JPMorgan Chase (JPM) all found a spot on the list of new buys by the best mutual funds.

Financial, Energy Stocks Find Buyers

With oil and natural gas stocks putting out nice gains in recent weeks, top funds have also picked up shares in several energy plays. Diamondback Energy (FANG), EOG Resources (EOG) and Matador Resources (MTDR) are among the oil stocks making the latest list of new buys by the best mutual funds.

Retailers Costco (COST) and Chipotle Mexican Grill (CMG) also made the cut.

Note: Be sure to check these Excel files, updated and published each month, to see all the stocks on the latest list of new buys and list of new sells by the best mutual funds.

Selling pressure in the market is testing several tech and growth stocks on IBD Long-Term Leaders. Among tech stocks, Alphabet, ASML, Applied Materials and Entegris (ENTG) are among those testing support and resistance at key moving averages.

Charles River Laboratories (CRL), West Pharmaceutical (WST) and Thermo Fisher Scientific — all IBD Long-Term Leaders in the medical sector — are also under pressure.

Will Top Funds’ Buys Ignite Rebound In Medical And Tech Stocks?

Looking beyond just these elite long-term leaders, energy stocks like EOG, MTDR and FANG stock are priming or pumping out new climbs, evidenced by their rising relative strength lines. These oil and natural gas plays had been rising in recent weeks, as they also now face selling pressure in the broad market.

After nice climbs, banking and financial stocks on the list of new buys by the best mutual funds also encountered — and so far generally weathered — the same headwinds. JPM, BAC, SIVB and Goldman Sachs (GS) are attempting to shake off recent bouts of selling pressure.

We’re now looking for the stock market indexes to establish a bottom and flash a follow-through day to launch a broad, sustainable uptrend. For that to happen, more traditional growth stocks in the medical, software, retail and technology sectors also need to participate.

Keep an eye out for any changes in stock market trend with the Market Pulse and The Big Picture. To see if growth stocks are starting to rebound and outperform the overall market, look for the RS lines of growth stocks like NVDA, GOOGL and CMG stock to trend higher.

Stock market corrections ultimately lead to stock market rebounds. So after protecting your profits and reducing your risk and exposure to the current downtrend, be sure to continue maintaining your watchlist. And review which stocks the best mutual funds are buying from which sectors to see which company might lead when the market rebounds.

How To Read Buys & Sells By The Best Mutual Funds

Ever wonder if managers of the best mutual funds know something you don’t? Would you like an early signal showing when institutional investors — especially the best ones — are getting in or out of certain stocks? New Buys Of Top-Performing Stock Funds and Top Funds’ Latest Sells provide just that. Use the PDF and Excel files to see when companies like GOOGL stock and Nvidia that are in demand with large investors.

Updated each month, the New Buys list includes only new buys of the top 30% of stock funds ranked by 36-month performance. Companies are sorted by the highest combined Earnings Per Share (EPS) and Relative Price Strength (RS) Ratings. The number of top-performing funds that bought the stock in the latest reporting period is given.

As seen in the links above to the PDF and Excel files, the Total Mil$ Invested column shows the amount of money, in millions, the funds put into each stock. The column reflects both new positions and additions to existing ones. Prices, EPS and RS Ratings, and P/E are from the month-end close.

The Latest Sells list tallies the number of top-performing funds that were net sellers of each stock in the fund’s latest reporting period. Because some funds bought the same stocks sold by others, we also looked at the total number of buyers of each stock.

Follow Matthew Galgani on Twitter at @IBD_MGalgani.

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