NASDAQ Composite (.IXIC) record high as earnings begin
US stocks have closed near record highs on Friday after the largest US bank, JPMorgan Chase & Co, soothed worries that the first-quarter earnings season would dampen Wall Street’s big rally back from last year’s slump.
The S&P 500 is now within one per cent of September’s record closing high, and the S&P 500 Total Return Index, which includes reinvested dividends, in fact regained record levels, recovering ground lost after a punishing sell-off in the closing months of the year.
Since then, the three major indexes notched their best quarterly gains in nearly a decade in the first quarter, but have spent April in a holding pattern ahead of first-quarter earnings season.
JPMorgan, effectively jump-starting the quarterly earnings reporting season that will dominate investor sentiment in coming weeks, blew past analyst estimates, easing fears that slowing economic growth could weigh on its results.
Its stock rose 4.7 per cent and led a broad rally in bank stocks.
“JPMorgan earnings are important because their operation touches on a wide portion of the economy,” said Shayne Heffernan, CEO and Founder of Heffx.
“It’s a bellwether for other corporate earnings.”
Analysts now expect S&P 500 companies to show a 2.3 per cent year-on-year decline in earnings, slightly improved from their last reading. But first-quarter profit is still seen logging its first annual contraction since 2016.
However, of the 29 companies in the S&P 500 that have reported thus far, 79.3 per cent have come in above analyst expectations.
Walt Disney jumped 11.5 per cent to an all-time high, providing the biggest boost to the Dow and the S&P 500 after pricing its upcoming streaming service.
Streaming rival Netflix slid 4.5 per cent.
For the week, both the S&P 500 and the Nasdaq showed their third straight gains, while the Dow posted a nominal weekly loss.
The Dow Jones Industrial Average rose 269.25 points, or 1.03 per cent, to 26,412.3, the S&P 500 gained 19.09 points, or 0.66 per cent, to 2,907.41 and the Nasdaq Composite added 36.81 points, or 0.46 per cent, to 7,984.16.
Of the 11 major sectors in the S&P 500, all but healthcare ended the session in positive territory.
Financials were the largest percentage gainer, rising 1.9 per cent on the back of JPMorgan Chase earnings.
Healthcare stocks extended their slide, with UnitedHealth Group down 5.2 per cent, Anthem dropping 8.5 per cent and Humana off 2.8 per cent. The S&P 500 Healthcare index slipped 1 per cent.
In the largest energy deal since 2016, Chevron said it would buy Anadarko Petroleum Corp for $US33 billion ($A46 billion) in cash and stock.
Chevron’s stock dipped by 4.9 per cent following the announcement, while Anadarko shot up 32 per cent.
Boeing rose 2.6 per cent as the plane maker’s stock recovered ground following its recent sell-off.
The CBOE Volatility Index – Wall Street’s so-called “fear gauge” slipped to a fresh six-month low on Friday, in a sign investors expect the good times to keep rolling.
Volume on US exchanges was 6.75 billion shares, compared to the 6.97 billion average over the last 20 trading days.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
The projected upper bound is: 8,166.98.
The projected lower bound is: 7,829.44.
The projected closing price is: 7,998.21.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.
A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 87.8759. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 1 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 69.14. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 3 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 89. This is not a topping or bottoming area. The last signal was a sell 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 8 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed up 36.805 at 7,984.164. Volume was 22% below average (neutral) and Bollinger Bands were 26% narrower than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 7,916.26 7,611.01 7,501.17
Volatility: 9 14 25
Volume: 514,276,448 576,425,088 572,679,552
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
NASDAQ COMPOSITE is currently 6.4% above its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into .IXIC (mildly bullish). Our trend forecasting oscillators are currently bullish on .IXIC and have had this outlook for the last 65 periods. The security price has set a new 14-period high while our momentum oscillator has not. This is a bearish divergence.
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