Dear Savio, One of the main catalysts behind the market’s recent consolidation was the rise in Treasury yields. The 10-year Treasury is currently sitting at about 1.4%, which is up from a 0.92% yield at the start of the year. It’s been a year since the 10-year Treasury broke through the 1.4% level. Federal Reserve Chair Jerome Powell’s comments to Congress on Wednesday initially helped temper this week’s rise in Treasury yields. Powell reiterated that the Fed would keep key interest rates near-zero and maintain its bond buying program for the foreseeable future. But the reality is that yields are rising, and that has spooked some investors in recent weeks. Interestingly, though, higher Treasury yields don’t necessarily equate to lower stock prices. The folks at Bespoke recently reported that the 10-year Treasury yield and the 30-year Treasury yield are back at 52-week highs, which hasn’t occurred since October 2018. Based on historical precedence, yields tend to fall over the next year after hitting new 52-week highs—and stocks trek higher. Consider this: Prior to the 10-year and 30-year Treasuries hitting 52-week highs on the same day this week, there were 15 previous occurrences since 1980. On average, the 10-year Treasury and the 30-year Treasury were historically lower one week, one month, six months and one year after setting new 52-weeks highs on the same day. Stocks, on the other hand, posted average gains in the week, month, three months, six months and year following the 10-year Treasury and 30-year Treasury setting 52-week highs on the same day. While we don’t know how it will all play out this time around, this is certainly a positive sign that the stock market could continue to climb higher in the upcoming months. As we discussed in Special Market Podcasts this week, I also think the stock market will move higher in the coming weeks and months. The reality is that now that the market has consolidated some of its recent gains, it should be gearing up for the next leg higher. A few catalysts to support this move will be improving economic data, positive first-quarter earnings revisions and quarter-end window dressing. Now, it’s important to note that as any market moves higher, it grows increasingly narrow and more fundamentally focused. In other words, money is chasing fewer stocks. As I put together the Growth Investor Monthly Issue for March this week, I discovered how selective institutional investors are becoming. Buying pressure is drying up in several of our positions, and we’re exiting seven Growth Investor stocks this month. I’ll be taking a closer look at our Breakthrough Stocks and our Platinum Growth Club Model Portfolio positions over the weekend in preparation for their respective monthly issues. We’ll likely continue to sell good stocks and concentrate on fewer stocks in the upcoming months to ensure that we remain well-positioned to prosper in the new environment. I’ll have more details on the changes that we’re making to the Model Portfolio in the March Update on Monday, March 1, and the Breakthrough Stocks Monthly Issue on Friday, March 5. In the meantime, let’s get right to your Growth Investor Monthly Issue for March and the Breakthrough Stocks Weekly Update. Growth Investor March Issue I’m pleased to bring you your Growth Investor Monthly Issue for March 2021! With the fourth-quarter earnings announcement season quickly winding down, it’s time for a little spring cleaning this month. The reality is that earnings season always separates the wheat from the chaff, as investors grow more focused on companies with superior fundamentals and positive guidance. In fact, in the past week alone, I’ve witnessed just how picky investors are becoming. Institutional buying pressure is drying up in a lot of S&P 500 companies, even companies with solid earnings and sales growth. Buying pressure has even dropped off in several of our Growth Investor stocks, and as a result, we’re selling seven Buy List stocks this month. But an increasingly narrow and fundamentally focused market is always good news for Growth Investor stocks, as they continue to represent the crème de la crème: They’re characterized by double-digit forecasted earnings and sales growth. So, in your Growth Investor Monthly Issue for March, we’ll take a closer look at the changing market environment. We’ll consider the recent shift in market leadership and discuss why institutional buying pressure is vital to a stock’s success. Simply put, we need to “follow the money,” and the money is leading up into three new buys with ties to China. Read all about it here. Breakthrough Stocks Weekly Update The fourth-quarter earnings announcement season is winding down. According to the latest report from FactSet, more than 80% of S&P 500 companies have released results so far. Of these companies, 79% have topped analysts’ earnings estimates and posted an average 14.6% earnings surprise. As a result, earnings are now expected to have grown 3.2% in the fourth quarter. Of course, if you checked the Earnings Center recently, then you know that our Breakthrough Stocks have posted even better fourth-quarter results. We’ve had 22 Buy List companies announce results from the latest quarter, with only two earnings misses and two in-line results. Our average earnings surprise is a stunning 25%. Now, with fourth-quarter earnings season quickly drawing to a close, the market is consolidating its recent gains and we’re starting to see a shift in leadership. In today’s Weekly Update, we’ll take a closer look at why the former flagship stocks are consolidating and consider how institutional buying pressure is playing a key role in the new emerging market leaders. In addition, we have several earnings announcements to review this week. We had four Buy List companies post results in the past week, and we have five more Breakthrough Stocks on tap to release results next week. We’ll take a closer look at each in your Weekly Update, as well as shine the spotlight on one of our Buy List companies that continues to expand its footprint in the U.S. Let’s look at the details. Sincerely, 
Louis Navellier
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