No rest for the weary. As US stocks come off their latest round of new highs, a flood of high-profile tech earnings are lined up for what looks to be another busy week in the markets.
Netflix (NFLX) blew the lid off its already hot rally by shooting up more than $46 (20%) since posting blockbuster numbers last week, and Facebook (FB), Amazon (AMZN), Apple (APPL), and Google (GOOG) will be releasing earnings this week.
Data source: OptionsHouse
The top-performing S&P 500 sectors last week were Health Care (+3.5%), Telecom Services (+3.4%), and Consumer Discretionary (+3.2%). Biotech stocks (+7.6%) helped propel Health Care to the top spot this week.
The three weakest sectors were Consumer Staples (+1%), Industrials (+1.1%), and Materials (+1.2%). Although all were in the green for the week, there were some notable pockets of weakness. Industrials, for example, were weighed down by a give-back in formerly hot Airlines (-8.4%) and Road & Rail stocks, while Household Products dampened the Consumer Staples sector.
Although earnings—and the market’s response to them—continued to be strong overall, last week’s economic numbers were a bit of a mixed bag. There was some softness in housing data and GDP, but strength in Leading Indicators and Durable Goods.
This week will be even “newsier.” In addition to a Federal Reserve (FOMC) meeting concluding on Wednesday, traders also have several big beginning-of-the-month economic reports (manufacturing, employment) to dissect:
●Monday: Personal Income and Outlays.
●Tuesday: S&P Corelogic Case-Shiller HPI, Consumer Confidence, FOMC Meeting Begins.
●Wednesday: ADP Employment Report, Employment Cost Index, Pending Home Sales Index, FOMC Meeting Announcement.
●Thursday: Productivity and Costs, PMI Manufacturing Index, ISM Manufacturing Index, Construction Spending, Motor Vehicle Sales.
●Friday: Employment Situation, Consumer Sentiment, Factory Orders.
With an average of 75 earnings releases per day scheduled this week—233 on Wednesday and Thursday alone—it’s only possible to scratch the surface. The remaining FAANG stocks, pharmaceutical and biotech, energy, and housing names are among the highlights.
●Monday: Lockheed Martin (LMT), Seagate Tech (STX), Reinsurance Group of America (RGA).
●Tuesday: Aetna (AET), McDonald's (MCD), Pfizer (PFE), Juniper Networks (JNPR).
●Wednesday: Boeing (BA), DR Horton (DHI), Eli Lilly (LLY), NASDAQ (NDAQ), Xerox (XRX), AT&T (T), eBay (EBAY), Facebook (FB), Overstock.com (OSTK), PayPal (PYPL), Qualcomm (QCOM), Symantec (SYMC).
●Thursday: Alibaba (BABA), Baxter (BAX), Boston Scientific (BSX), CME Group (CME), DowDuPont (DWDP), Hershey Foods (HSY), Int'l Paper (IP), Alphabet (GOOG), Amazon (AMZN), Amgen (AMGN), Apple (AAPL), Cypress Semi (CY), Mattel (MAT).
●Friday: Aon (AON), AstraZeneca (AZN), Chevron (CVX), Clorox (CLX), Exxon Mobil (XOM), Honda Motor (HMC), Merck (MRK), Sony (SNE), Weyerhaeuser (WY).
You can see a complete list of earnings and other market events on the E*TRADE market calendar (logon required).
In futures, crude oil rebounded from the previous week’s pullback, with the March contract (CLH8) gaining more than 4% on the week and pushing back above $66/barrel. Copper dropped sharply on Tuesday but rebounded the next day to set up a possible swing low, and April gold futures (GCJ6) pushed to a contract high above $1,370 on Thursday. Warnings of a bear market in US Treasuries kept pressure on March 10-year T-note futures (ZNH8), which closed Friday on a low note.
With just three days left in the month, the US equity market is on track to record one of its strongest Januaries in decades. The first 18 trading days of the month were the fourth-strongest for the S&P 500 (+7.45%) since 1960 and the fifth-strongest for the Dow (+7.68%) since 1929, respectively. If the Dow ends the month no lower than Friday’s closing price, it will be one of the top-10 Januaries for the Blue Chip Index in the past 100 years.
We’ll follow up on those performance as the week progresses. Buckle up.