Buy 3 Momentum Anomaly Stocks as Markets Dip on Tech Pullback

Market Overview - The U.S. equity markets have experienced a downturn recently, primarily due to a pullback in blue-chip tech stocks, which has negatively impacted the overall market [1] - The 10-year Treasury yield has increased to 4.2%, influenced by solid economic data, including a revision of second-quarter GDP growth from 3.3% to 3.8% [1][2] - Weekly jobless claims decreased to 218,000 from 232,000, contrasting with expectations of 235,000 claims, indicating a robust job market [1][2] Federal Reserve and Interest Rates - The strong job market and revised GDP estimates have raised concerns about the Federal Reserve's potential interest rate cuts, following a recent reduction of 25 basis points to a range of 4.00%-4.25% [2] - Investors are awaiting the personal consumption expenditures price index reports for August for further insights into the Fed's rate cut policy [2] Momentum Investing Strategy - Momentum investing is highlighted as a strategy to capitalize on current trends, based on the principle of "buying high and selling higher" [3] - This strategy aims to profit from the tendency to extrapolate current trends into the future before mean reversion occurs [3] Screening Parameters for Momentum Stocks - The screening process identifies stocks with the best percentage price change over the last 52 weeks, selecting the top 50 performers [5] - From these, the bottom 10 performers over the past week are chosen to identify those experiencing short-term pullbacks [6] - Stocks with a Zacks Rank 1 (Strong Buy) and a Momentum Style Score of B or better are prioritized, indicating a higher probability of success [7] Selected Stocks - Wolverine World Wide, Inc. has seen a 62.5% increase over the past year but experienced an 8.2% decline last week, holding a Momentum Score of B [9][11] - Carpenter Technology Corporation has risen 48.9% in the past year but fell 5.8% last week, also with a Momentum Score of B [12][13] - Astera Labs, Inc. has surged 266.5% over the past year but dropped 20.3% last week, backed by a Momentum Score of A [14][15]