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Like the majestic eagle, US stocks soar on strong jobs data, following tame inflation and strong growth readings this week

May 03, 2019

 

Better Research, Better Investments.Better Research, Better Investments.
Better Research, Better Investments.Better Research, Better Investments.

US Markets End of Day Snapshot

  • US stocks rally broadly today powered by strong jobs data; this comes in a week that saw tame inflation and strong growth readings, supporting investors' view of a Goldilocks economy
  • The S&P 500 finished up 0.96%, Nasdaq Composite up 1.58%, and Russell 2000 up 1.98%
  • We launched our WARREN BUFFET FUND and CNBC.com wrote about itThese are the stocks Warren Buffett would buy if he were a quant
  • The US added 263,000 jobs in April, well above 190,000 expected
  • Average hourly earnings rose 3.2% y/y in April, just below 3.3% consensus
  • Jobs data today DID NOT get a boost from Census hiring
  • Read more on the jobs data: read more: YOU'RE HIRED! US jobs report ROCKS with jobs added blowing away expectations
  • The US stock market has added $5 trillion in value since the start of 2019
  • The very best US LARGE-CAPsMay's Plays: These US LARGE-CAP TOP PICKS are what your portfolio needs NOW!
  • Our CIO was interviewed by Benzinga: A Q&A With The Co-Founder Of Quantamize
  • Reason for Fed to cut?  How Low Can They Go: New Statistical Measures of Inflation could move Fed to cut rates
  • Consumer Discretionary (+1.4%), Industrials (+1.24%), and Telecom (+1.16%) stocks were the top performers in the S&P 500 today
  • Consumer Staples (+0.74%), Real Estate (+0.66%), and Utilities (+0.65%) stocks were the worst performers in the S&P 500 today
  • Investor sentiment for US stocks finished positive with the advance/decline ratio for the S&P 500 closing at 5.41x
  • 42 stocks in the S&P 500 hit 4-week highs while 91 stocks reached 4-week lows
  • 41 stocks in the S&P 500 closed overbought while 15 stocks closed oversold according to the 16-day RSI Measure
  • 108 stocks in the Nasdaq Composite hit 4-week highs while 102 stocks reached 4-week lows
  • 225 stocks in the Nasdaq Composite closed overbought while 459 stocks closed oversold according to the 16-day RSI Measure
  • The VIX closed  down -1.21 points today  to 13.21 after closing at 14.42 yesterday

Stocks Trending in the News

Click name for Q-Factor rating and financials data.

Global Consumer Stocks Trending in the News

  • Berkshire Hathaway (BRK) has taken a stake in Amazon (AMZN).  CEO Warren Buffet announced the stake in an interview on CNBC.  Buffet said it was not he but one of his colleagues that decided to make the investment.  Buffett has said in the past he missed investing in Amazon early on in its history.  Buffett has said he was extremely impressed with CEO Jeff Bezos when they met.  Berkshire Hathaway is not rated on our Global Top Stock Picks.  Amazon is rated “Neutral” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas  
  • Beyond Meat (BYND) soared 163% in its first day of trading.  Beyond Meat debuted Thursday was bid up all day long.  Beyond Meat is a maker of meat substitute products.  Beyond Meat raised $241 million in its IPO as it seeks to capitalize on demand for vegan products.  Beyond Meat is not yet rated in our Global Top Stock Ideas
  • MercadoLibre (MELI) reported first quarter revenue that beat consensus.  MercadoLibre reported first quarter revenue $473.8 million, well above the $421 million consensus.  MercadoLibre reported total payment volume of $5.64 billion benefiting from its recent push into payments.  Gross merchandise volume in the quarter was $3.09 billion.  MercadoLibre is rated “Neutral” in our US Information Technology Global Top Stock Ideas.  
  • Newell Brands (NWL) reported earnings that beat consensus with net sales that came in line.  Newell Brands reported first quarter normalized EPS of 14 cents, well above 3 cents expected.  First quarter net sales of $1.7 billion, in line with $1.69 billion.  Newell’s CEO commented that the company has gotten off to a good start to the year.  Newell Brands is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas  
  • Shake Shack (SHAK) reported sales growth that beat expectations and upped guidance.  Shake Shack first quarter same store sales grew 3.6%, well ahead of the 0.8% growth expected.  Revenue of $132 million beat $127 million expected.  Second quarter revenue guidance was hiked to $576 million to $582 million, up from $570 million.  Shake Shack is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Tesla Inc. (TSLA) shares traded higher after the company announced plans to raise roughly $2 billion of capital through debt and stock offerings. Tesla filed on Thursday to sell $1.35 billion in convertible debt notes and $650 million in equity shares. Dan Ives of Wedbush Securities explained that, “We view this as a clear net positive for Tesla.” Tesla is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Weight Watchers (WW) reported results much better than expected.  Weight Watchers first quarter revenue of $363 million came in line with $365 million consensus.  The loss of 16 cents per share came much better than the 26 cents loss expected.  Weight Watchers raised its full year EPS guidance to $1.35  to $1.55 while consensus is $1.34.  Weight Watchers is not rated in our Global Top Stock Ideas. 

Global Information Technology and Communication Services Stocks Trending in the News

  • Activision Blizzard (ATVI) delivered first quarter earnings that beat expectations.  Activision Blizzard posted first quarter adjusted EPS of 31 cents versus 26 cents expected.  Adjusted revenue of $1.26 billion slightly beat consensus of $1.23 billion.  Activision Blizzard gave EPS guidance for the second quarter of 23 cents well below consensus of 37 cents.  Full year EPS guidance given was ~$2.10, below consensus of $2.19.  Activision Blizzard is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Alphabet’s (GOOGL) Google is planning to add product prices and recommendations underneath videos on its YouTube.  It will rebrand Google Express as Google Shopping and promote it this way.  The report appeared in The Information, Google has no comment.  Alphabet is rated “Top Buy” in our US Large-Cap Global Top Stock Ideas and “Top Buy” in our US Information Technology Global Top Stock Ideas.  
  • Cognizant (CTSH) cut guidance and reported weak results, leading to 9 downgrades in a single day.  Cognizant reported a 14% decline in EPS to 91 cents.  Cognizant reduced guidance by 7-9% in constant currency, surprise to most investors.  Clients are cutting spending and Cognizant changes CEO and President recently, a mix that has left the company in turmoil.  Cognizant is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Attractive” in our US Information Technology Global Top Stock Ideas.  
  • Facebook (FB) announced it is creating a payment system based on cryptocurrencies.  The system will be built on top of the backbone of Facebook’s network.  If completed, the system would be the most mainstream application of cryptocurrencies.  Facebook is trying to recruit financial institutions to participate in the system.  The project is called Project Libra and would use a coin that could be use both on the Facebook system and outside it.
  • Softbank (TSE: 9984) is considering an IPO for its $100 billion Vision Fund, according to a report in the WSJ today.  The report also says Softbank is considering launching a second fund of the same size.  Softbank is looking to capitalize on the red-hot start-up interest that exists today.  Softbank has been spending $7 billion per quarter on deals and needs more funding soon to be able to maintain that pace.  SoftBank Chief Executive Masayoshi Son has said he does not see an immediate need for fundraising.  Softbank is rated a “Top Buy” in our Japan Large-Cap Global Top Stock Ideas 

Global Healthcare Stocks Trending in the News

  • Immunogen (IMGN) reported results that came worse than expected.  Immunogen reported a loss per share of 30 cents while consensus was for a 21 cents per share loss.  Immunogen posted revenue of $8.58 billion, well below $9.2 billion expected.  Immunogen said its operational review is underway with the goal of extending cash position.  Immunogen is rated “Top Short” in our US Large-Cap Global Top Stock Ideas is rated “Attractive” in our US Large-Cap Global Top Stock Ideas and “Neutral” in our US Information Technology Global Top Stock Ideas.  

Global Commodities & Energy Stocks Trending in the News

  • Dominion Energy (D) reported first quarter operating revenue that missed consensus.  Dominion Energy first quarter operating revenue of $3.86 billion trailed $4.84 billion expected.  First quarter EPS of $1.10 came in line with $1.12.  Dominion Energy gave second quarter EPS guidance of 70 to 80 cents.  Full year EPS guidance is $4.05 to $4.40 while $4.21 is consensus.  Dominion Energy is rated “Attractive” in our US Large-Cap Global Top Stock Ideas

Global Industrials Stocks Trending in the News

  • Boeing (BA) limited the role of its own pilots in the final stages of approval for the 737 Max, according to the WSJ.  Boeing’s pilots were not aware of key functioning of the MCAS system implicated in its 2 crashes.  The lack of involvement by Boeing’s own pilots in the final stages is raising eyebrows and sure to gain more scrutiny from regulators.  Boeing is rated “Top Short” in our US Large-Cap Global Top Stock Ideas and “Unattractive” in our US Industrials Global Top Stock Ideas
  • Embraer (ERJ) confirmed its backlog at the end of the first quarter totaled $16 billion, down from $16.3 billion.  Embraer said it delivered 11 commercial jets were delivered in the quarter, 10 E175s and 1 E-190-E2s.  11 business jets were delivered as well, 8 were light and 3 were large.  Embraer is rated “Neutral” in our Brazil All-Cap Global Top Stock Ideas
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US Treasuries

  • US 2-Year Treasury Notes are higher with yields down -1.18 basis points to 2.33%
  • US 5-Year Treasury Bonds are higher with yields down -2.16 basis points to 2.32%
  • US 10-Year Treasury Bonds are higher with yields down -1.64 basis points to 2.52%
  • The US Treasury 2s-5s Spread has narrowed 0.98 basis points to -0.01%
  • The US Treasury 2s-10s Spread has narrowed 0.46 basis points to 0.19%
  • US Treasury 5s-10s Spread has widened 0.52 basis points to 0.2%

Currencies

  • EUR€ is up 0.269% against the USD$ in after hours to 1.1202
  • GBP£ is up 1.067% against the USD$ in after hours to 1.3171
  • CHF is up 0.255% against the USD$ in after hours to 0.9835
  • JPY¥ is down 0.368% against the USD$ in after hours to 111.1

Commodities

  • WTI Crude is little changed 0.21% to USD$61.94/bbl with the Brent-WTI spread up USD$0.55 to USD$9.25/bbl
  • Gold is up 0.62% to USD$1278.63/oz

 

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

S&P 500 Sector ETFs - End of Day

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

Russell 1000 Factor ETFs - End of Day

*Data in Price Return and Updated Real-Time (with a delay), Source: StockDio

 

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S&P 500 Movers

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Outperformers Sector Price 1D % Chg Volume
Newell Brands Inc Consumer Discretionary 20.8 13.52%            2,644,054
Flowserve Corp Industrials 41.4 9.34%                827,061
Monster Beverage Corp Consumer Staples 54.7 8.83%            2,121,288
DENTSPLY SIRONA Inc Health Care 39.8 6.89%            1,483,057
ResMed Inc Health Care 116 6.56%                311,693
 
Underformers Sector Price 1D % Chg Volume
Cognizant Technology Solutions Corp Information Technology 66 -11.05%            9,733,844
Arista Networks Inc Information Technology 223 -10.44%                866,685
Fortinet Inc Information Technology 74.6 -6.06%                716,908
Activision Blizzard Inc Communication Services 46.8 -4.84%            6,507,508
Skyworks Solutions Inc Information Technology 68.4 -3.51%                926,658
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY
Morning BriefA quick GLOBAL RECAP TO START YOUR DAY