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Sell the Rumor…Buy the News

Did you do a double take on today's headline - "Sell the Rumor, Buy the News"? Yes, it is the inverse of the standard investor wisdom to buy the rumor, and sell the news. But in this case, with the growing concern of Russia invading the Ukraine investors are pressing the sell button once again. However, as I will share in detail below, that is a poor idea because war is not actually a negative for the economy and the S&P 500 (SPY). More on that and other timely investment matters will be discussed in this week's POWR Value commentary. Read on below…

(Please enjoy this updated version of my weekly commentary published February 11th, 2022 from the POWR Value newsletter).

Let’s get right to it.

The stock market was rebounding from the January correction thanks to improving economic conditions. This was corroborated by yet another solid earnings season

Then investors started to wet the bed Friday on increased concerns that Russia could invade the Ukraine at any moment. This led to a spate of Risk Off trades:

Falling stock market
Flight to Safety in bonds
Gold on the rise too

The one oddity versus typical Risk Off activity is that oil was also on the rise.

But that comes from the idea that any military actions or sanctions on Russia would come with oil supply problems that would push prices higher.

Gladly we have 2 oil positions in the portfolio and both doing very well today (+3.53% and +5.23% respectively).

Now the reality check.

There is not much “there, there” when it comes to the markets suffering during times of potentially new military conflicts.

After initial pullbacks from the shock of the event, stocks come roaring back to life.

And that’s mostly because the markets move on economic conditions and wars = higher spending = higher economic activity.

Of course I am not pro war. I am just pro FACTS. And making decisions off those facts to put ourselves in the best possible position to benefit.

Those FACTS (as you will see in this article) point to not selling at this time and expecting a bounce soon even if a conflict erupts between Russia and Ukraine.

In the meantime expect volatility to be the norm (which we were getting used to already).

What To Do Next?

If you’d like to see more top value stocks, then you should check out our free special report:

7 SEVERELY Undervalued Stocks

What makes these stocks great additions to any portfolio?

First, because they are all undervalued companies with exciting upside potential.

But even more important, is that they are all A rated Strong Buys according to our coveted POWR Ratings system. Yes, that same system where top-rated stocks have averaged a +31.10% annual return.

Click below now to see these 7 stellar value stocks with the right stuff to outperform in the coming months.

7 SEVERELY Undervalued Stocks

All the Best!

Steve Reitmeister
CEO StockNews.com & Editor of POWR Value trading service


SPY shares closed at $440.46 on Friday, down $-8.86 (-1.97%). Year-to-date, SPY has declined -7.26%, versus a % rise in the benchmark S&P 500 index during the same period.



About the Author: Steve Reitmeister

Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also shares his 40 years of investment experience in the Reitmeister Total Return portfolio. Learn more about Reity’s background, along with links to his most recent articles and stock picks.

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