Market Perspective for April 13, 2020

The Nasdaq increased 0.48 percent on Monday after Amazon (AMZN) said it will hire 75,000 new workers. Both Amazon and its main competitor Wal-Mart (WMT) are near all-time highs. Netflix (NFLX) and other companies expected to benefit from quarantine also saw shares surge on Monday. Netflix hit a new 52-week high.

Technology was the best performing sector on Monday. SPDR Technology (XLK) increased 0.29 percent.

An OPEC deal to cut oil production didn’t stem the selling in energy markets. West Texas Intermediate crude slipped more than 1 percent on the day. SPDR Energy (XLE) declined 0.32 percent.

March retail sales will be released on Wednesday. Analysts project a 7.1 percent decline and a 4.9 percent decline, ex-autos. Economists forecast March industrial production to have slid 4.0 percent.

The U.S. Dollar Index weakened slightly on Monday, falling 0.15 percent. iShares MSCI Emerging Markets (EEM) gained 0.14 percent, while iShares MSCI EAFE (EFA) fell 0.95 percent.

Earnings reports will dominate headlines this week. We anticipate most companies won’t offer forward looking guidance. The analyst consensus calls for a 10.0 percent decline in first quarter S&P 500 earnings from year-ago levels. Given the high amount of uncertainty created by the coronavirus, results could deviate significantly.

There will be a high degree of variability in company performance. Some firms have benefited from the pandemic, while others have suffered.

Two large banks will announce earnings on Tuesday. JPMorgan (JPM) and Wells Fargo (WFC) will both provide reports. Additionally, United Continental (UAL), Johnson & Johnson (JNJ), Fastenal (FAST), JB Hunt (JBHT), Infosys (INFY), PacWest Bancorp (PACW) and First Republic Bank (FRC) will deliver results.

Wednesday brings Bank of America (BAC), Citigroup (C), Goldman Sachs (GS), Morgan Stanley (MS), PNC Financial Services (PNC), Charles Schwab (SCHW), U.S. Bancorp (USB), UnitedHealth Group (UNH), Progressive (PGR), Las Vegas Sands (LVS), ASML Holding (ASML) and Bed, Bath & Beyond (BBBY).

On Thursday, we’ll hear from Delta Air Lines (DAL), Abbot Labs (ABT), Intuitive Surgical (ISRG), Honeywell (HON), Taiwan Semiconductor (TSM), Blackstone Group (BX), Bank of New York Mellon (BK), KeyCorp (KEY) and Rite Aid (RAD).

Oil services giant Schlumberger (SLB), Kansas City Southern (KSU), Regions Financial (RF), State Street (STT), Citizens Financial Group (CFG) and IMAX Corp (IMAX) will report on Friday.

 

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