It was more of the same Monday for the bulls. Stocks started the session with gains and mostly ended that way. The S&P 500 (SPX) rallied to 4,187, a gain of 0.2%, notes Jon Markman of Pivotal Point.
Smaller stocks were even stronger. The Russell 2000 surged to 2,298, a jump of almost 1.2%. This broadening of market strength comes one day ahead of a barrage of big-tech quarterly financial reports.
If investors like what they see from Apple (AAPL), Amazon.com (AMZN), Facebook (FB), Google (GOOGL) and Microsoft (MSFT) the benchmark is certain to climb above 4,200 soon, sparking a massive, short-covering rally.
It’s a little hard to believe surprises are in store, but execs’ positive outlook could open eyes. My expectation is that the response at first may be muted or negative, but bulls could recover quickly. Support is 4,110.
The Nasdaq 100 was up by 0.6%, while the Dow fell by 0.2% to 33,981.57. Energy and consumer discretionary were the biggest gainers while consumer staples led the decliners.
Breadth favored advancers over decliners on Monday, 2-1. There were an astonishing 1,013 new highs and just 37 new lows. Topping the new highs list were Raytheon Technologies (RTX), Capital One (COF), Carrier Global (CARR), D.R. Horton (DHI), and Archer-Daniels-Midland (ADM). Hello, industrials.
Shares of Apple (AAPL), which is set to release its results April 28, were little changed after the Financial Times and CNBC reported the company faces antitrust complaints in Germany over its upcoming operating system, which a group of German industry associations claims will negatively impact the mobile advertising sector.
Apple, which unveiled Monday a five-year plan to invest more than $430 billion in US operations, is set to post strong earnings in its fiscal second-quarter amid robust China demand and rising average selling prices, Wedbush said in a note Friday.
Other mega-cap technology companies set to report earnings this week are Alphabet (GOOGL) and Microsoft (MSFT) on Tuesday, Facebook (FB) on Wednesday, and Amazon (AMZN) on Thursday.
Meanwhile, elevator operator Otis Worldwide (OTIS) reported higher Q1 earnings with both top and bottom lines beating analyst estimates. It also raised its 2021 outlook. Shares jumped 7%.
American Express (AXP) Q1 adjusted EPS topped analyst projections, while revenue came up short. Shares were up by 4.2%, the top performer on the DJIA index.
Pretty dull session, with the narrowest trading range in the S&P 500 since last August, but our positions made good money so no complaints.
Learn more about Jon Markman at Pivotal Point.
