The ETF Investor Guide for April 2019

The April Issue of the ETF Investor Guide is NOW AVAILABLE!  Links to the April Data Files have been posted below Market Perspective: Financial Stocks Deliver Strong Earnings Technology has […]

Market Perspective for April 29, 2019

Equities extended their gains with the S&P 500 Index hitting a new all-time high, the first since September 2018. The Nasdaq also achieved a new all-time high.  The S&P 500 Index gained 0.11 percent on the day, while the Nasdaq increased 0.19 percent.

SPDR Financial (XLF) climbed 1.03 percent. The next largest gainer was SPDR Communication Services (XLC), up 0.95 percent. The rally in financials has been driven by rising interest rate expectations. SPDR Real Estate (XLRE) fell 1.04 percent and SPDR Utilities (XLU) 0.59 percent.

Vanguard cut fees on 21 ETFs on Monday. Among those with lower expenses are Vanguard High Dividend Yield (VYM), down 2 basis points to 0.06 percent and Vanguard Total Stock Market (VTI), was lowered 1 basis point to 0.03 percent.

The Conference Board’s consumer confidence index for April is out on Tuesday. Analysts expect confidence rose during the month. Pending home sales for March are also out.

Manufacturing PMIs should show continued expansion, though at a slightly slower pace than in March. Motor vehicle sales for April, factory orders for March and the services PMIs will all be released Friday.

On Friday, the Bureau of Labor Statistics releases the employment report for April. Economists forecast 211,000 new jobs and predict the unemployment rate will have fallen to 3.7 percent.

Earnings reports this week will focus on numerous technology companies. Alphabet (GOOGL) reported after the bell on Monday along with Western Digital (WDC) and NXP Semiconductor (NXPI). Google beat earnings estimates after excluding a fine paid to the European Union but missed on revenue.

Tuesday brings Apple (AAPL), Advance Micro Devices (AMD), Mastercard (MA), Pfizer (PFE), General Electric (GE), Merck (MRK), ConocoPhillips (COP), General Motors (GM), McDonald’s (MCD), Amgen (AMGN), WellCare (WCG) and Eli Lilly (LLY).

Qualcomm (QCOM), Square (SQ), USG Corporation (USG), CVS Health (CVS), Humana (HUM), CME Group (CME) and Kraft Heinz (KHC) report on Wednesday.

On Thursday, Gilead Science (GILD), Wayfair (W), EOG Resources (EOG), Cigna Corp (CI), Monster Beverage (MNST), DowDuPont (DWDP) and Dow Chemical (DOW) headline.

Noble Energy (NBL), American Tower (AMT) and Dominion Energy (D) finish the week.

 

Market Perspective for April 26, 2019

Stocks continued move higher this week, led by the 1.83-percent return in the Nasdaq. The Russell 2000 Index rose 1.66 percent and the S&P 500 Index 1.20 percent. The Dow Jones Industrial Average slipped 0.06 percent because of earnings misses from 3M (MMM) and Exxon Mobil (XOM).

Healthcare and communication services led sector performance this week. SPDR Healthcare (XLV) climbed 3.61 percent and SPDR Communication Services (XLC) 3.29 percent.  Healthcare provider Anthem (ANTM) gained 11.18 percent after delivering solid results. That sparked a rally in the entire medical provider subsector. Facebook (FB) boosted the communication services sector after it handily beat forecasts. Shares returned 7.41 percent for the week.

GDP growth exceeded expectations at 3.2 percent for the first quarter. The Atlanta Fed’s GDP Now model was the most optimistic at 2.7 percent growth, while the broad consensus was 2.3 percent. Personal consumption, inventory investment, exports, and state and local government spending drove the increase.

Existing home sales hit an annualized pace of 5.21 million in March. New home sales are now at an annualized pace of 692,000, the second highest pace in a decade. Durable goods orders jumped 2.7 percent, more than 5 times the forecast. The University of Michigan’s consumer sentiment survey for April showed an uptick from March. Weekly jobless claims bumped up to 230,000 after hitting 50-year lows.

Earnings season has been overall positive, with approximately one-third of S&P 500 companies reporting.  Among the winners were Microsoft (MSFT), Amazon (AMZN), Facebook (FB), Ford (F), eBay (EBAY), Lockheed Martin (LMT) and Twitter (TWTR). Companies missing estimates included 3M, Intel (INTC) and Exxon Mobil (XOM).

Crude oil slid more than 3 percent on Friday, closing at $62.80.

 

Market Perspective for April 22, 2019

Equities were mixed in a light-volume post-holiday trading session. Many overseas markets were closed in observance of Easter. The Nasdaq was the best performing major index, gaining 0.22 percent. The S&P 500 index roses 0.10 percent. The Dow Jones Industrial Average and Russell 2000 Index fell 0.18 percent and 0.36 percent, respectively.

SPDR Energy (XLE) climbed 2.02 percent, powered by U.S. sanctions on Iranian oil. The U.S. issued waivers in November for countries importing Iranian oil, including China, India, Japan, Italy and South Korea. When those waivers expire on May 2, they will not be renewed. Crude oil spiked 2.70 percent to $65.70, nearly a six-month high.

Existing home sales hit an annualized pace of 5.21 million in March, slightly below forecasts. New home sales are out on Tuesday, with analysts forecasting an annualized pace of 656,000.

The Bureau of Economic Analysis will announce its advance estimate of first quarter GDP growth on Friday. The Atlanta Fed’s GDP Now model predicts 2.8 percent as of April 19. Analyst consensus calls for 2.3 percent growth.

Earnings season kicks into high gear this week with 34 percent of the S&P 500 reporting. Tuesday sees Proctor & Gamble (PG), Coca-Cola (KO), Texas Instruments (TXI), eBay (EBAY), Lockheed Martin (LMT), Twitter (TWTR) and Sherwin-Williams (SHW) report.

Facebook (FB), Boeing (BA), Anthem (ANTM), Caterpillar (CAT), Biogen (BIIB), Chipotle (CMG), Boston Scientific (BSX), Dominos Pizza (DPZ) and F5 Networks (FFIV) deliver earnings on Wednesday.

Thursday brings Amazon (AMZN), Bristol-Myers Squibb (BMY), AbbVie (ABBV), Comcast (CMCSA), Freeport-McMoRan (FCX), D.R. Horton (DHI), Baxter International (BAX), Ford Motor (F), Aflac (AFL) and Capital One Financial (COF).

The week closes out with the energy giants Exxon Mobil (XOM) and Chevron (CVX), along with Colgate-Palmolive (CL), AstraZeneca (AZN), WABCO (WBC) and Archer-Daniels-Midland (ADM).