market folly

Strategist Jeff Saut's latest market commentary is entitled 'Lose Cash.' In it, he talks about how the market is off to its eighth best start of the year as managers have put cash to work. However, he's still not ready to shed his cautious stance. Why?

Well, he highlights the divergence between stock prices and US Economic data trends in April 2011 and thinks a similar situation is occurring now. Saut feels that "all the good news is on the table" and points out other signs of concern such as massive insider selling, as well as falling 10 year Treasury prices (rising rates).

Saut reiterates that he is not getting "too bearish" because he expects stocks to be higher at the end of the year. But it does sound as though he expects a pullback in the intermediate term. Last week we detailed how Saut says to position your portfolio this year.

He also recommended two stocks that have declined recently for "one-off" reasons: Acme Packet (APKT), Nuance (NUAN), and Vocus (VOCS).

Embedded below is Jeff Saut's market commentary:



You can download a .pdf copy here.

For more investment strategy from Saut, also check out dividend stocks he likes.