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“There are decades where nothing happens; and there are weeks where decades happen” – Vladimir Ilyich Lenin
Futures are lower this morning after investors take profits following a torrid rally since the start of the month. Home Depot (HD) reported earnings this morning, and despite strong results, the stock sold off on the news, and that helped contribute to the weaker tone in futures. Walmart (WMT) also reported earnings, and that’s having a modestly positive reaction in the pre-market as earnings season winds to a close.
Earnings season may be winding down, but there’s plenty of other factors for investors to contend with today as there’s a busy slate of economic data, including Retail Sales, Import Prices, Industrial Production, Capacity Utilization, Business Inventories, and Home Builder Sentiment. If that’s not enough for you, there’s also plenty of Fedspeak to deal with as well
Be sure to check out today’s Morning Lineup for a rundown of the latest stock-specific news of note, Singapore trade data, trends related to the COVID-19 outbreak, and much more.
It’s been a strong month for the US equity market, but sometimes putting numbers on the totals helps to put it in perspective. Within the Russell 3000, which encompasses large, mid, and small caps stocks, the average performance of the stocks in the index this month is a gain of more than 15%. 15%! In most years, that’s considered a good year, and it’s only been eleven trading days!
In terms of sectors, Energy is leading the way as stocks in the sector are up an average of 24.6% followed by Communication Services, where the average performance of stocks in that sector has been a gain of just over 20%. Outside of those two sectors, Real Estate (19.6%), Industrials (18.4%), and Financials (16.1%) are the three only other sectors with average returns ahead of the Russell 3000. One sector notably absent from the list of outperformers is Technology. That sector normally tops the list during periods of market strength, but the average performance of stocks in that sector so far this month is 2.5 percentage points behind the market at 12.8%- not too shabby. With stocks in the Utilities sector averaging a gain of 9.7%, it’s at the back of the back, but it’s hard to consider that weak.