© Reuters. FILE PHOTO: New York Stock Exchange (NYSE) building after the start of Thursday’s trading session in New York
By Chuck Mikolajczak
(Reuters) – The and the Dow climbed to record highs on Friday, partly due to gains in growth stocks. However, gains were subdued ahead of the start of the quarterly earnings season next week.
Growth names have taken hold in the past two weeks after being outperformed by value stocks for most of the year. A retreat from a 14-month high in late March added confidence in economic growth.
The data showed that US producer prices rose faster-than-expected in March, making their largest annual gain in 9 1/2 years.
Many investors are now anticipating higher inflation as the introduction of vaccines helps the U.S. economy recover from coronavirus lockdowns. However, stocks showed little concern about the data as the Federal Reserve has claimed inflation will exceed its target.
“I can understand why investors would say I’m not going to freak out on prices because reflation trading has a positive impact on profits,” said Sam Stovall, chief investment strategist at CFRA Research in New York.
“They take the bad with the good, the good when the economy is going to go up and profits are going to go up. Hey, I’m going to take some inflation with this because I don’t think inflation will reverse anything.” the expected increase in profit margins. “
The S&P 500 rose 134.94 points or 0.4% to 33,638.51, the S&P 500 rose 13.22 points or 0.32% to 4,110.39 and the additional 14.43 points or 0, 1% to 13,843.74.
Banks are set to kick off the first quarter earnings season next week, and analysts expect S&P 500 companies’ earnings to grow 25% year over year. According to Refinitiv IBES data, this is the strongest performance of the quarter since 2018.
Megacap names like Apple (NASDAQ :), Amazon (NASDAQ 🙂 and Microsoft (NASDAQ :), which are included in the growth index, have accelerated the S&P 500. Amazon shares rose 1.96% when warehouse workers in Alabama turned down an attempt to unionize.
The Russell 1000 growth index, made up largely of technology stocks, is likely to outperform its counterpart, which is made up mostly of cyclical stocks like financials and energy names, for a second week after the recent decline in longer-term government bond yields.
Bank of America (NYSE 🙂 weekly fund flow figures showed that investors had pumped more money into stocks in the past five months than in the past 12 years.
Honeywell (NYSE 🙂 rose 2.44% to boost the Dow as Jefferies (NYSE 🙂 and JP Morgan raised their price targets for stocks in the US aero parts maker.
Declining issues outperformed advancing issues on the NYSE by a ratio of 1.02 to 1. On the Nasdaq, a ratio of 1.63 to 1 favored declines.
The S&P 500 posted 45 new 52-week highs and no new lows. The Nasdaq Composite made 67 new highs and 39 new lows.
Disclaimer: Fusion Media would like to remind you that the information contained on this website is not necessarily real-time or accurate. All CFDs (stocks, indices, futures) and forex prices are not provided by exchanges, but by market makers. Therefore, prices may not be accurate and may differ from the actual market price. This means that the prices are indicative and not suitable for trading purposes. Therefore, Fusion Media is not responsible for any trading losses you may incur as a result of using this data.
Fusion Media, or anyone involved with Fusion Media, assumes no liability for any loss or damage caused by reliance on the information contained on this website, such as data, offers, charts and buy / sell signals. Please inform yourself comprehensively about the risks and costs associated with trading in the financial markets. This is one of the riskiest forms of investment possible.