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.