Speaker 1: 0:00

The one big beautiful bill act is now law. It extends the 2017 tax cuts and the jobs act, and there are certain stocks that are likely to benefit. So I've combined here my insight from the actual bills provision, including the tax incentives for domestic investments and how they will drive stock buybacks, particularly from some of the big stocks out there. So, to kick us off, we're going to start off with defense and aerospace stocks. There's a big shift in spending there. The first one we're looking at and I've actually made a heat map of all the stocks, so I'm not holding you hostage some big tickers, but there are some smaller ones which might be the more interesting ones to actually look at. Stock numero uno is Huntington Ingalls ticker symbol HII. And what do they do? Well, they're going to benefit from the $34 billion naval fleet expansion very significantly.

Speaker 1: 0:58

And if I look at the stock chart, and the one thing I would say with this is, the people who will benefit from the most from this government-driven rally are those who understand the rules that Wall Street's been using for like 50 years on when do we buy and when do we sell and that sounds kind of like sounds good. Doesn't it Be nice to know those rules. Well, you can actually learn the rules and I'll walk you through a little bit of it here today, but we don't have an hour and a half or something, which is how long it would probably take me to really teach you this. So I will teach you this live, if you care to join, on Saturday at 10 am New York time, so just after your July 4th holiday, and you will understand much, much better these very predictable patterns that we see again and again, and again, and why yeah, we're a little bit late to this one, but not that late to this one, and why that was actually the buy point and why that wasn't an arbitrary point, but that was like the point to look at it. But because we haven't seen the volume pick up yet. Institutions are not gobbling this up yet.

Speaker 1: 2:00

We're probably still early in effect, which is one of the reasons we like this particular setup. Actually, there was an earlier entry here as well, but we can't go back in time, we can only look forward. And does this look good? From my perspective? Yes, we have a nice clean liftoff here. Four or five days in a row of green Moving average lines are looking good. Volume is a little disappointing, so I wouldn't go too big in on this one. Of course, this is not me giving you financial advice, just telling you the way I see it. And then we're going to get some resistance when we get into that sort of zone here which we're starting to enter. So we might see a little bit of a slowdown.

Speaker 1: 2:35

We're probably going to see a second chance to enter and then we're going to get the real lift off once people really start to realize how big these contracts will be and how the US Navy is basically. Well, it's a Navy from the last century and in this century everything is autonomous, everything is small, a lot of it is disposable single use, and at the moment the US Navy doesn't have a lot of that. So they're going to have to spend a lot to catch up with the technology that now allows that sort of thing to happen basically unmanned ships with unmanned planes on top and unmanned drones coming out of it and all that kind of stuff. All of them much, much, much, much lower cost. So hii is definitely part of that. That's why we're liking it. The next stock on our list here is um, this one here, lockheed martin, and you make these heat maps in trade vision. You can just right click on them and basically you make them just from a watch list. So you just create a watch list and you can see all your watch lists in here and then you can see exactly what that looks like, which I find very, very useful, especially if you want to track your portfolio or something like that. And Lockheed Martin to me well, they're going to benefit from the missile defense shield $25 billion. So we now have essentially paid for early contracts for this very, very advanced system to sort of put that golden dome defense shield over the US, much like what Israel has got.

Speaker 1: 4:02

And the chart could not be better, and I'll tell you why Because it isn't going up, is it? So it collapsed significantly, right Stocks down tremendously, and then it entered into this sort of zigzag phase. And that's exactly what we look for. We look for a period of consolidation. We want exactly that. We want consolidation. The longer that goes on, for the longer that period of sideways action actually the better, for when it eventually does break out, the breakout will be bigger. Why? Because in this period of going sideways, a lot of people who own the stock got bored and they sold. And that's what we want? We want to shake out all the sellers.

Speaker 1: 4:42

So actually, these great, big red candles like that one here with huge, huge, huge sell volume, we love that. Well, we're not in it, so we love it. And when do we get in it? At this particular point, no, not for me. I will very, very happily pay a few dollars extra and be on the safer side. And what does that mean? It means entering slightly above that sort of buy zone here. And I'm connecting all the highs, essentially sort of 480, 485, something like that. Again, I'm not telling you what to do. You have to come to your own conclusions on that one. But when this pops up, I think it's going to pop up mightily. And if you just look at where we came from, say, you return to all-time highs. Well, you'd be 33% up, which is not bad for a stock as big as Lockheed Martin I know it's not your latest meme coin, but still not too bad at all.

Speaker 1: 5:30

And the next stock on our list is GD General Dynamics, another defense stock which, if you look at this and by the way, they also benefit from the naval contracts, they're also involved in private jets and there might be significantly higher demand for those because of tax incentives, because any American-made vehicle will have this loan deduction, and that should also apply to private jets, which would be very good for, again, general dynamics. But what do you see? What do you see? Well, you see the stock going sideways, right sideways, for quite a while and then eventually breaking out of that zone. It's just done it. Volume popped up, which means institutions actually paid attention. So we really really like this. Now do you therefore think, oh my god, we're far too late, felix, he should have told me about, which means institutions actually paid attention. So we really really like this Now. Do you therefore think, oh my God, we're far too late, felix, you should have told me about this few days ago. Well, we're 3% above it. I mean 3% amongst friends, sort of neither here nor there. So, yeah, I think all-time highs and beyond, I believe, are coming. They're basically all crashed because they weren't quite sure what was going to happen, I think, with the defense budget, but more money is going to get pumped into that than ever before. I would argue let's move on to something slightly different, slightly different sector, but sort of similar border security and infrastructure. One of the plays that we see as a potential winner here is floor corporation. There's about a 46.5% border wall contract and infrastructure out there, and floor are allegedly the guys to do that. So this looks pretty promising.

Speaker 1: 7:06

And what have we done? Well, we've come out of the deepest, darkest ages of that. Here We've recovered. We've bounced up above the 150. Here we did that on big, big and beautiful volume, as is appropriate for the bill. And right now we're in this consolidation phase where some of the bag holders who bought over here are still clinging on to it and starting to sell slowly when they get back to zero. And that's where we've seen a little bit of this sideways action here, but popped out there on yesterday on the bill news. So are we liking it here? Yeah, we're liking it here.

Speaker 1: 7:39

And again, you don't need to be super early. If the setup looks good, if the new cycle looks good, if the momentum is there, we follow the momentum. We don't buy before the momentum. In fact, we aim to buy slightly after the momentum is kicked off. So, yeah, that might have been a better entry point, but that doesn't mean it isn't going to continue to go up a lot more, right? And if you doubt that, well, let me show you one, for example, that we did a little while back here. We bought it down here at $7.81. People kept saying all the way up that it was too late, it was too late. It was too late and then actually did drop 24% up there, recovered again From our buy point. This stock is right now still up 328% in 41 bars. So momentum is our friends.

Speaker 1: 8:23

The next stock and that's been one that's been on our buy list for a little while as well is Caterpillar appropriate because we have a lot of cats in here who are unseasonally quiet right now I shall be enjoying the sunshine and we called an early buy point here and we actually got in on that. So you've had this beautiful run up here, right, and it's been a really good run up 11, 12% up. But the real party is about to start, in my humble opinion, when, well, draw a simple line that connects these all-time highs up there. That's always a zone, by the way, it's never a straight line. So take the highest one there, connected to the lower one here, and the low one there. Draw it across. That is your nirvana, that is your chosen golden thing. We get through that sort of 414, 418. That's when the real liftoff happens Because at that point there isn't a single person in Caterpillar who's down on their investment. At the moment there are still like two or three loons above the very top of the market, and so where we are right now, we're in a place of almost zero resistance, about to hit zero resistance, and that makes it much, much easier for stocks to, like that, to go up. And why would Caterpillar go up, by the way? Well, again, they supply equipment and border infrastructure products and projects and so on. So these guys just benefit from our infrastructure spend.

Speaker 1: 9:50

Now, the other sector on our list here, which CVX and XOM here reflect, is energy, oil and gas. The clean energy credits that are being, or have been, repealed are good for oil and gas. It reduces competition. Also, they've unlocked federal lands for more drilling drill, baby drill. So both Exxon and CVX seem to be kind of ideal contenders for this situation, and CVX really has not performed very well. Right, it's done absolutely bugger, all wars and all. They couldn't really shake them.

Speaker 1: 10:26

So we're still off about 21% of all-time highs and the stock came a little bit to life the last two or three days on the hope of that big beautiful bill. But we haven't broken through that purple line here yet, which is the 150-day moving average line, and mostly for investors, you actually want to be above that. So there is still a very early setup here, I think, for Chevron to benefit from this and then similarly, on the XOM side you have a similar setup, but actually a little bit of a better setup. Why is it a bit of a better setup? Because we're already above the 150-day moving average line, broke out a little bit more there, but still far off its all-time highs. So I think the oil party is about to get started and to give you one more bonus stock and I know I said it was going to be eight, but it's going to be more than that is this one here. Northern Dynasty Mining Again their benefit from domestic mining support. It's been an absolute winner here and I think this will continue to win, especially once we take out these recent highs again there, which were at a boot $1.57. Also, much, much lower market cap, much, much lower stock price. The potential for this to go up is a lot bigger than, say, a XOM or a CVX.

Speaker 1: 11:48

Now, what about just tax breaks, generally speaking? Well, you see, on here I put on Uber. Why did I put on Uber Because, well, there will be no more tips taxes, so no more tax on tips. And that does what? Well, it boosts driver retention. It might just improve operations for companies like Uber who are like very much in that sort of tipping part of the world. And again we are right at the previous highs there. It's just forming that high again and again, and again and again. So you break out of these highs to about close above sort of 94, 94.50, and then the party gets started. Autonomous driving is going to be very, very good for Uber because they won't need drivers, it'll get cheaper, more people will use it, it'll be more efficient, right, they can drive 24-7 more or less. So, very bullish on Uber. I think this whole story that Uber is going to get killed by Tesla and all that I don't think that's going to happen. I think Uber is going to use Tesla's, maybe not on day one, but they will eventually, because it just makes sense to tap into a network that is already there. So I think they're going to work hand in hand here.

Speaker 1: 12:57

Now we also actually have tax cuts, right, so there's some standard deductions, the salt nonsense, and that could just drive up retail sales a little bit. So if you're looking for something to just benefit on retail sales, well, something like Walmart or a Target would be the obvious beneficiaries from that, because that just captures a huge percentage of retail spend. And if you look at Walmart good old Walmart well, it hasn't done very much lately and that's one of the reasons we like it. It's just been going absolutely sideways in sort of a textbook fashion. So let's break out above those highs there, and that's where I would buy. I would not buy where we are right now. I would always buy a little bit higher, and I know that's counterintuitive. But if you really want to understand how that's going to work, then join me on Saturday, felixfrenzorg slash seminar and I'll really really break that down for you.

Speaker 1: 13:50

Another stock that is an obvious beneficiary from this, in my humble opinion, is Palantir. Why? Well, just think about the border, for example, and ICE. So they're going to get $4 billion for the border patrol, $10 billion for ICE. Well, what systems do you think that's going to be run on? Who do you think is going to get contracts related to that? Well, palantir. So the same. With all the modernization of shipbuilding, all the defense stuff, palantir is the operating system for all of it. They are the operating system of the government.

Speaker 1: 14:22

I've been saying this for like two or three years now and people are still saying, yeah, but I saw somebody video the other day and said, oh my God, I did the maths and Palantir. This is crazy. And what they don't understand is that the market in the short term does not care about crazy, it encourages crazy. If you met some investment bankers, you'd understand why. So momentum can drive a stock up and up and up and up and up, almost without limit. Now, what is what do we do when it eventually collapses? Well, we have a stop and we take big, beautiful profits. Now, why did I put on this here? Microsoft and amazon, and meta, and and and google? Even did I put google on here? I guess I didn't.

Speaker 1: 15:02

I'm not going to walk you through every single one of these stocks, because you know what they do. But the hyperserscalers, the Amazons, the Microsofts, the Googles, the Apples, the Metas, the Oracles what are they getting? Well, they're getting a tax break. First of all, the 21% corporate rate is enshrined and they get 100% bonus depreciation. What does it mean? Well, anything you invest in the US, you get a huge tax break for.

Speaker 1: 15:27

So who invests the most in the US? Well, the guys building the data centers, the AI infrastructure, maybe chip manufacturing, like Apple, and all of that is going to be very good for these companies. So what are they going to do with the extra money that they'll have? Well, they're going to hand it back to you and me, the shareholders how? Through buybacks. So all this cash flow is going to spur massive, massive repurchasing. I mean, we already have $90 billion for Apple, $60 billion for Microsoft, but these programs could go up very, very significantly. If you look at what happened in 2018, they almost doubled. So, overall, this government is arranging a stock market rally, and maybe you hate the bill. Maybe you think all the spending is completely irresponsible. Maybe you think the US economy is going to grow at 4% to 7%, which seems to be required to offset the crazy spending, and none of that really matters.

Speaker 1: 16:20

It's not about politics, it's not about being right. It's just about looking what just happened or looking what's about to happen, and then making good decisions on that basis, because that's what we do this for, right. We do this to make money for ourselves and our families. So we have more options, more freedom. So if you got some value out of these picks, imagine the value you'll actually get if you learn how we make every single stock selection and how we learn when to get in, when to get out, how to get that confidence. And, by the way, I do all of my trading on Sundays. I do not trade Monday to Saturday, so anybody can do this. Join me, felix Rensselaer, at our seminar, and I wish you all the best.