Markets Close At Record Highs

|
Posted: Apr 24, 2019 9:33 AM
Markets Close At Record Highs

Source: AP Photo/Richard Drew

All eyes were on the S&P 500 yesterday, as it closed at an historic high, breaking through the previous high of 2940.  The Nasdaq also closed at a record high, and it has fared the best so far this year.  All the major indices have had stellar performances year to date.   

  • Nasdaq Composite +22.4% YTD
  • Russell 2000 +17.5% YTD
  • S&P 500 +17.0% YTD
  • Dow Jones Industrial Average +14.3% YTD

S&P 500 Index

Communication Services (XLC)

+1.34%

Consumer Discretionary (XLY)

+1.20%

Consumer Staples (XLP)

-0.32%

Energy (XLE)

-0.16%

Financials (XLF)

+0.62%

Health Care (XLV)

+1.58%

Industrials (XLI)

+0.87%

Materials (XLB)

+0.45%

Real Estate (XLRE)

+1.14%

Technology (XLK)

+1.09%

Utilities (XLU)

+0.28%

 

Earnings continues to buoy the markets higher, and it appears to be the case again this morning as several big names have reported.  Results are mixed, and as I have said, it’s worrisome that revenues are falling short, while EPS continues to rock. 

  • Anthem (ANTM) beat on EPS of $6.03, revenues were in line at $24.39 billion, and the company raised guidance for FY19.
  • AT&T (T) beat on EPS of $0.96, revenues missed despite rising 17.8% year over year.  
  • Boeing (BA) missed on the top and bottom line, with revenues at $22.92 billion and EPS of $3.16.  The company is suspending its full-year guidance based on the uncertainty surrounding the 737 Max, however it said it's making "steady progress" on the software update.
  • Biogen (BIIB) beat on top and bottom line, with revenues up 11.5% to $3.49 billion, and EPS of $6.98.
  • Caterpillar (CAT) beat on EPS by $0.08, to $2.94, revenues were in line, up 4.7% y/y to $13.47 billion, and the company reaffirmed FY19 guidance.  
  • eBay (EBAY) beat on the top and bottom-line estimates, EPS $0.67 and revenues of $2.64 billion and guided Q2 EPS above consensus. 
  • Snap (SNAP) beat on the top and bottom line, EPS -$0.10, revenues soared 38.9% y/y to $320.43 million and guided in-line for Q2.
  • Stanley Black & Decker (SWK) beat on EPS of $1.42, revenues of $3.33 billion were in-line, and raised guidance for the FY19.
  • Texas Instruments (TXN) beat on EPS of $1.22, revenues declined 5.1% y/y to $3.59 billion, issued inline guidance for Q2.

Bidding War

Perhaps, the news of the morning is Occidental Petroleum’s (OXY) bid to acquire Anadarko Petroleum (APC) for $76/share, in a 50-50 cash and stock deal ($38 is in cash and 0.6094 shares of OXY).  This offer is a 20% premium to Chevron's (CVX) previous bid. 

Portfolio Approach

Communication Services

1

Consumer Discretionary

4

Consumer Staples

1

Energy

1

Financials

1

Healthcare

1

Industrial

3

Materials

3

Real Estate

0

Technology

2

Utilities

0

Cash

3

 

The major indices are now indicating a slightly positive open.  Let’s see if we can get follow through on yesterday’s performance.