Concerns of the economy losing momentum in the absence of another stimulus package weighed on stock prices. Rising COVID19 case count and election uncertainties added to the worries. Bargain hunting in large-cap technology stocks could not prevent the S&P 500 from suffering its fourth straight weekly loss.

With Congress stuck in a stalemate over the next stimulus package, weaker-than-expected jobless claims and durable goods orders stoked concerns of the economic recovery losing momentum.

The rise in COVID19 case count prompted the United Kingdom to re-impose lockdown and other restrictions.

Following three straight weeks of relatively large declines in large-cap technology stocks, investors sought bargains, pushing the technology-heavy NASDAQ Composite index above the flatline for the week.

There was no such turnaround for the broader S&P 500 benchmark.

For the week ending September 25, the S&P 500 (SPY) fell 0.6%, its fourth straight weekly decline.

Three of the 11 sectors ended above the flatline.

Leaders and laggards for the week ending September 25, 2020.

Information technology (XLK), utilities (XLU), and consumer discretionary (XLY) led the performance chart.

Energy (XLE), materials (XLB), and financials (XLF) lost the most.

Breadth was strongly negative with the number of declining stocks in the S&P 500 beating advancers by a 3-to-1 ratio.

The S&P 500’s top 10 winners included companies from the communication services, consumer discretionary, and information technology sectors.

1. Communication Services: Twitter (TWTR)

Twitter (TWTR) shares rose 9% to be the week’s top performer. Pivotal Research Group raised the rating on the social-media platform’s shares to Buy from Hold. The new $59.75 share-price target implies a 37% upside.

2. Consumer Discretionary: Nike (NKE), Darden Restaurants (DRI), and eBay (EBAY)

Shares of Nike (NKE), Darden Restaurants (DRI), and eBay (EBAY) were up 8% each. Athletic footwear maker Nike (NKE) and the Olive Garden restaurant owner Darden (DRI) reported better-than-expected earnings. Nike saw its digital sales rise by over 80%. Darden reinstated its dividend.

eBay shares rebounded from their prior week’s decline after Piper Sandler initiated coverage with an Overweight rating and a $65 price target, implying a 27% upside.

3. Information Technology: Lam Research (LRCX) and PayPal (PYPL)

Positive comments from analysts at Citigroup and Stifel lifted shares of semiconductor equipment maker Lam Research (LRCX) to an 8% gain. PayPal (PYPL) shares gained 6% after Loop Capital initiated coverage on the digital payment company with a Buy rating.

Other top 10 winners in the S&P 500 included:

• Veterinary diagnostics equipment maker IDEXX Laboratories (IDXX) up 7%
• Tax software developer Intuit (INTU) up 6%
• Electronic trading platform MarketAxess Holdings (MKTX) up 6%

Looking ahead to the week of September 28

* The upcoming presidential election will be in focus early next week as President Trump and Democratic nominee Biden tee-off the first debate on Tuesday night.

* Key economic data are due at the back end of the week, providing insight on manufacturing, inflation, and employment. Thursday brings in reading on the Institute of Supply Management’s manufacturing index, and the personal consumption expenditures index, the Federal Reserve’s preferred inflation measure.

* The keenly watched September jobs report is due on Friday. This would be the last monthly employment report before the Presidential election. The economists’ consensus forecast is for job creation to slow to 920,000 from 1.37 million in August. The unemployment rate is expected to drop to 8.2% from 8.4%.

* Six S&P 500 members are scheduled to report earnings. Among them, investors will look to Micron Technology (MU) for providing an assessment of the state of the semiconductor chip market. Four consumer-related brands Conagra (CAG), Constellation (STZ), McCormick (MKC), and PepsiCo (PEP) report as well.
 

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Stocks were unable to sustain the gains provided by enthusiasm from M&A activity. The Federal Reserve’s somber assessment of the economy stoked concerns of an extended period of sluggish economic growth. Rising testiness in Sino-American relations also weighed on stocks, pushing the S&P 500 for its third straight weekly loss.

A couple of mega-deals boosted investor confidence and helped stocks get out of the blocks quickly last week. NVIDIA (NVDA) offered $40 billion to buy chipmaker ARM Holdings from Softbank. Gilead Sciences’ (GILD) $21 billion offer to buy biotech firm Immunomedics (IMMU) represented a 100% premium.

The advance faltered after the Federal Reserve indicated it would keep rates near zero through at least 2023. The central bank warned of risks to the economy from COVID19 without additional fiscal stimulus. Fed Chairman Powell called ongoing unemployment and the uptick in evictions & foreclosures as ‘things that will scar the economy’ without further support from Congress.

The U.S. Commerce Department said it is prohibiting transactions involving Tencent’s WeChat and Bytedance’s TikTok. The uncertainty cast on the proposed transactions involving TikTok and Oracle dampened market sentiment. The U. S. government said it would block all TikTok and WeChat downloads in the country starting Sunday.

For the week ending September 18, the S&P 500 (SPY) fell 1.0%, its third straight weekly decline.

Five of the 11 sectors ended above the flatline.

Leaders and laggards for the week ending September 18, 2020.

Energy (XLE), industrials (XLI), and materials (XLB) led the performance chart.

Communication services (XLC), consumer discretionary (XLY), and consumer staples (XLP) lost the most.

Breadth was, however, positive as the number of advancing stocks in the S&P 500 beat decliners by a 3-to-2 ratio.

The S&P 500’s top 10 winners included companies from the industrial, energy, and information technology sectors.

1. Industrials: General Electric (GE)

General Electric (GE) shares surged 16% to be the week’s top performer. CEO Culp said the industrial giant would be cash flow positive in the back half of 2020, several months earlier than forecast in July.

2. Energy: Diamondback Energy (FANG), Occidental Petroleum (OXY), and TechnipFMC (FTI)

The price of oil rose 10% to $41.11 a barrel on a combination of oil production outages due to Hurricane Sally and rising hope of OPEC members complying with their production quotas. Saudi Arabia rebuked OPEC members for violating production quotas. Analysts at Goldman Sachs and UBS predicted a deficit in oil supplies.

Supported by a rise in the price of oil, shares of Diamondback Energy (FANG) & Occidental Petroleum (OXY) rose 14% each, and those of TechnipFMC (FTI) rose 9%.

Energy ETFs with a range of flavors gained over 6%. They include SmallCap Energy ETF (PSCE), Natural Gas ETF (FCG), Exploration & Production ETFs (PXE, XOP), and Unconventional Oil & Gas ETF (FRAK).

3. Information Technology: Fiserv (FISV) and Micron Technology (MU)

Shares of payments & financial technology provider Fiserv (FISV) rose 11% after Compass Point initiated coverage with a ‘Buy’ rating and $130 a share price target implying a 35% upside.

Micron Technology (MU) shares gained 10% after Goldman Sachs upgraded them to Buy from Neutral. The analyst upgraded shares of the semiconductor chip maker on industry checks suggesting a recovery in DRAM demand in the back half of the year.

Other top 10 winners in the S&P 500 included:

• Packaging solutions provider WestRock (WRK) up 11%
• Office REIT SL Green Realty (SLG) up 4%
• Department store Kohl’s (KSS) up 4%

Looking ahead to the week of September 21

* Federal Reserve Chairman Powell has more opportunities to press the case for additional fiscal stimulus this week. He and Treasury Secretary Mnuchin appear before the House Financial Services and the Senate Banking committees to discuss COVID19 aid.

* The S&P 500’s consumer sector heavyweights Nike (NKE), Costco Wholesale (COST), and General Mills (GIS) report their earnings.

* The economic calendar includes existing and new home sales, providing a read on the health of the housing sector. Weekly jobless claims, forecasted at 825,000, will continue to be a focal point for investors in this pandemic-centered market.
 

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Stocks swung wildly last week shortened by the Labor Day holiday. The week’s outcome, however, resembled the result of the previous week. The S&P 500 posted its second straight weekly loss. The materials sector was the top performer, once again managing to buck the broad market decline.

The decline in stock prices continued from the previous week on valuation concerns. Market leaders Alphabet (GOOG), Amazon (AMZN), Apple (AAPL), Facebook (FB), Microsoft (MSFT), and Tesla (TSLA) lost more than $1 trillion in market value over the three days ending on September 8. This decline attracted bargain hunters, and the S&P 500 surged 2% on September 9. The rally, however, fizzled out.

For the week ending September 11, the S&P 500 (SPY) fell 3.3% after losing 2.3% the week before.

Ten of the 11 sectors declined.

Leaders and laggards for the week ending September 11, 2020.

Materials (XLB) led the performance chart for the second week in a row. It was the only sector to finish in the black for the week.

Industrials (XLI) and utilities (XLU) held up better than the S&P 500.

Energy (XLE), information technology (XLK), and communication services (XLC) lagged the S&P 500.

The number of declining stocks in the S&P 500 beat advancers by a wide 8-to-3 ratio.

The S&P 500’s top 20 winners included companies from the consumer discretionary, industrials, and materials sectors.

1. Consumer discretionary: Tapestry (TPR) and PVH Corp. (PVH)

Tapestry (TPR) was the week’s top performer in the S&P 500, rising 10%. Shares of the luxury accessories & footwear designer rose after Exane BNP Paribas initiated coverage with an Outperform rating and set a $24 price target. Bullish options trading activity also helped the advance.

Shares of apparel maker PVH Corp. (PVH) rose 9% after analysts at Citigroup (C) & Cowen (COWN) upgraded them. PVH shares were up 11% the week before when the company surprised investors reporting a profit.

2. Industrials: Fortive Corp. (FTV)

Fortive (FTV) shares rose 4% after the industrial instrumentation & automation enabler raised its third-quarter revenue forecast. Better-than-expected performance in the first two months of the quarter prompted the company to up its guidance. Several analysts raised their Fortive price targets.

3. Materials: LyondellBasell Industries (LYB) and Sherwin-Williams (SHW)

LyondellBasell Industries (LYB) and Sherwin-Williams (SHW) shares rose 5% and 4%, respectively, after analysts nudged their current year and next year earnings estimate higher. LyondellBasell’s gains came on the back of a 6% advance the week before.

Alternative assets aligned with the materials sector, namely commodity-oriented exchange-traded products (ETPs), performed well last week. The winners included:

• Livestock ETN (COW) up 6%
• Platinum ETF (PPLT) up 4%
• Corn ETF (CORN) up 4%

Looking ahead to the week of September 14

* The Federal Reserve takes center stage, with its interest rate policy-setting Federal Open Market Committee holding its last meeting before the presidential election. The Fed is expected to update its economic & interest rate outlooks and introduce its 2023 forecasts. Whether Wall Street will get the insights it hopes for on balance sheet adjustments, bond purchase targets, and yield curve controls remain to be seen.

* August retail sales take the spotlight in economic data as they provide a reading on consumer spending in the absence of the boost from enhanced unemployment benefits. With Congress unlikely to come through with additional stimulus, investors will keep a close watch on the trend in weekly jobless claims.

* Recent weakness in price has not deterred new supply from coming to market. Several initial public offerings (IPOs) are expected next week. Data warehousing platform Snowflake (SNOW), game development platform Unity Software (U), and food packing producer Pactiv Evergreen (PCTV) are among the larger offerings expected to debut.

* Three S&P 500 members, Adobe (ADBE), FedEx (FDX), and Lennar (LEN) are scheduled to report their quarterly earnings.
 

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Spurred by excitement from Apple’s & Tesla’s stock splits and Zoom Video’s record-setting earnings report, stocks got off to a strong start in September. Concerns of valuation excesses, however, soon got in the way. The S&P 500 ended its winning streak after five weeks of gains.

Stocks got out of the blocks quickly in September, spurred by excitement from Apple’s four-for-one and Tesla’s five-for-one stock splits. In a sign of the times, Zoom Video Communications (ZM) soared 40% after its quarterly sales more than quadrupled.

Concerns of rising valuation soon tripped stocks. Investors rotated out of the red-hot technology sector and into out-of-favor parts of the market like cyclicals, defensives, and value stocks. A Financial Times report escalated worries of excesses in valuation, attributing them to Softbank options trading.

The Labor Department reported the economy regained a higher-than-expected 1.4 million jobs in August. The unemployment rate fell to 8.4% from 10.2% the month before. The jobs report, however, could not turn the S&P 500’s fortunes; its winning streak ended after five straight gains.

For the week ending September 4, the S&P 500 (SPY) fell 2.3%.

Nine of the 11 sectors declined.

Leaders and laggards for the week ending September 04, 2020.

Materials (XLB) and utilities (XLU) were the two sectors finishing in the black for the week.

Energy (XLE), information technology (XLK), and communication services (XLC) lagged the S&P 500.

The number of declining stocks in the S&P 500 beat advancers by a wide 2-to-1 ratio.

The S&P 500’s top 10 winners included companies from the consumer discretionary, consumer staples, and materials sectors.

1. Consumer discretionary: PVH Corp. (PVH) up 11% and Carnival (CCL) up 8%

PVH Corp. (PVH) reported a profit of $0.13 a share versus analysts’ forecast for a loss of $2.42 a share from cost-cutting, strength in digital commerce, and improved inventory management. The apparel maker noted improving business trends in the current quarter in China and Europe.

Carnival’s (CCL) Italy-based brand Costa Cruises announced the start of sailings from Italian ports on Sunday, September 6. Carnival’s Germany-based AIDA Cruises expects to offer cruises starting November 1.

2. Consumer staples: Brown-Forman Class B. (BF-B) up 9%

Brown-Forman (BF-B), the owner of Jack Daniels whiskey and Corbel champagne brands, reported $0.67 a share in profit, beating analysts’ estimate of $0.31 as home consumption of spirits surged during the pandemic.

3. Materials: Eastman Chemical (EMN), LyondellBasell Industries (LYB), International Paper (IP), and Dow Inc. (DOW) up over 6% each

Companies in the materials sector fared well after the ISM reported a better-than-expected Manufacturing Index reading of 56.0 for August. Analysts at Citigroup and Tudor Pickering raised their price targets on Dow (DOW) and Eastman Chemical (EMN). They also benefited from the rotation into value & cyclical stocks.

ETFs also reflected the strength of the materials sector. Palladium ETF (PALL), Brazil small-cap ETFs (BRF and EWZS), and Copper Miners ETF (COPX) were among the week’s top performers.

Others in the list of the S&P 500’s top 10 winners included:

• Asset manager Invesco (IVZ) up 6%
• Biotech company Alexion Pharmaceuticals (ALXN) up 6%
• Credit card provider Discover Financial (DFS) up 5%

Looking ahead to the week of September 8

* The upcoming trading shortened by the Labor Day holiday on Monday marks the end of the summer holidays. Trading volumes should increase as institutional investors return from vacations.

* The earnings calendar includes just two S&P 500 members, Kroger (KR) and Oracle (ORCL). Among companies rising to prominence during the pandemic, Lululemon Athletica (LULU), Peloton Interactive (PTON), and Slack Technologies (WORK) report.

* As for economic data, the consumer price index should provide a reading on inflation. Economists expect a relatively small increase in core inflation. They forecast month-over-month and year-over-year gains of 0.2% and 1.6%, respectively.
 

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The Federal Reserve unveiled a new framework allowing inflation to exceed its goal for some time. The daily count of new COVID19 cases continued to decline amidst progress in battling the pandemic. The S&P 500 topped 3,500 for the first time.

The Federal Reserve announced its new monetary policy of average inflation targeting. The central bank would let inflation run moderately above its 2% target for some time instead of proactively limiting it. The new framework could allow the Fed to keep interest rates lower for a long time.

The daily count of new COVID19 cases in the U. S. continued to fall. Data compiled by Johns Hopkins University showed the 5-day average dropped to 46,150 last week from a high of 77,250 in mid-July. The U. S. FDA approved Abbott’s (ABT) rapid COVID19 antigen test and the use of convalescent plasma as a treatment option.

The S&P 500 extended its winning streak to five weeks and scaled the 3,500 milestone to set a new all-time high. While growth stocks fared better than value stocks in the large-cap universe, the converse was true among small-caps.

For the week ending August 28, the S&P 500 (SPY) rose 3.3%.

Ten of the 11 sectors gained with utilities (XLU) being the exception.

Leaders and laggards for the week ending August 28, 2020.

Communication services (XLC), information technology (XLK), and financials (XLF) led the S&P 500.

Utilities (XLU), healthcare (XLV), and energy (XLE) lagged the benchmark.

The number of advancing stocks in the S&P 500 beat decliners by a wide 9-to-2 ratio.

Twenty-five of the S&P 500 members advanced double-digits.

The S&P 500’s top 10 winners included software companies as well as retailers, airlines, and other ‘reopening plays’.

1. Software – salesforce.com (CRM) up 31%

salesforce.com (CRM) shares had a big week after the software company earned $1.44 per share in the second quarter, more than double analysts’ estimate. Revenues rose 29%. Upbeat revenue guidance for the current quarter coupled with the company’s imminent inclusion in the Dow Jones Industrial Average powered the gains.

iShares Expanded Tech-Software Sector ETF (IGV) and Global X Cloud Computing ETF (CLOU) were among the top ETFs last week, advancing over 7% each. The strong performance of Microsoft (MSFT), salesforce.com, Adobe (ADBE), and Workday (WDAY) shares supported the ETFs’ advance.

2. Retailers – Gap (GPS) up 22% and Kohl’s (KSS) up 15%

Apparel retailer Gap (GPS) reported a quarterly loss of $0.17 a share, lower than analysts’ $0.41 a share estimate. Gap topped revenue forecasts as the pandemic drove sales of casual clothing and face masks.

Kohl’s (KSS) shares rose on positive analyst comments expressing confidence in the department store’s capability to increase market share in the post-pandemic environment.

3. Airlines – Delta Air Lines (DAL) up 17% and Alaska Air (ALK) up 15%

Shares of Delta Air Lines (DAL) and Alaska Air (ALK) rose with those of other air carriers on declining daily COVID19 case count and positive developments in testing & treatment. The broad strength in airline shares lifted the U.S. Global Jets ETF (JETS) by 10% last week.

Other ‘reopening plays’ in entertainment and travel services popped on positive COVID19 news to round out the list of the S&P 500’s top 10 winners. They included:

• Live entertainment company Live Nation (LYV) up 15%
• Cruise lines Carnival (CCL), Royal Caribbean (RCL), and Norwegian (NCLH) up over 14% each
• Apparel maker PVH Corp. (PVH) up 14%

Looking ahead to the week of August 31

* On August 31, the Dow Jones Industrial Average gets reconstituted with Amgen (AMGN), Honeywell (HON), and salesforce.com (CRM) taking the place of Pfizer (PFE), Raytheon Technologies (RTX), and ExxonMobil (XOM). Apple (AAPL) shares split 4-to-1.

* The focus shifts to employment towards the end of the week. The Labor Department comes out with its August jobs report on Friday. According to Refinitiv, economists expect job creation to decline to 1.4 million jobs in August from 1.8 million in July.

* The upcoming week is a light one for earnings reports with six of the S&P 500 members reporting. Of them, semiconductor chipmaker Broadcom’s (AVGO) earnings report can impact the overall market. Outside the S&P 500, pandemic-era software darlings CrowdStrike Holdings (CRWD), DocuSign (DOCU), and Zoom Video Communications (ZM) report as well.
 

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Investors continued to pile on to large-cap technology stocks and helped the S&P 500 set a new all-time high. Minutes from the July Fed meeting revealed the central bank’s concerns on continued economic recovery. Economic data portrayed a mixed picture.

Large-cap information technology stocks rose on the belief that such companies would come out stronger from the pandemic. Apple (AAPL) became the first publicly traded U. S. company to reach the $2 trillion market capitalization milestone. The gain in Apple shares, the most heavily weighted component of the NASDAQ and S&P 500 indexes, handily boosted the benchmarks.

The minutes of the interest rate-setting Federal Reserve Open Market Committee’s July meeting unveiled the central bank’s concern on the pandemic weighing over economic activity, employment, and inflation in the near term and posing considerable risks to the economic outlook in the medium term.

In economic data, measures of manufacturing and service activities as well as measures of the housing industry surprised to the upside. Employment-related data, however, did not live up to expectations with weekly jobless claims rising back above 1 million.

For the week ending August 21, the S&P 500 (SPY) rose 0.8%.

Six of the 11 sectors gained.

Leaders and laggards for the week ending August 21, 2020.

Information technology (XLK), consumer discretionary (XLY), and communication services (XLC) led the S&P 500.

Energy (XLE), financials (XLF), and utilities (XLU) lagged the benchmark.

The breadth of the advance was poor with advancing stocks in the S&P 500 lagging decliners by a wide 1-to-2 ratio.

Only three of the S&P 500 members advanced double-digits.

The S&P 500’s top 10 winners included retailers, information technology companies, and homebuilders.

1. Retailers – L Brands (LB) and Target (TGT) up 13% each

L Brands (LB) surprised investors reporting a profitable quarter as its Bath & Body Works and Victoria’s Secret lines benefited from the strong sanitizer sales and online apparel sales, respectively.

Target’s (TGT) second-quarter sales grew an enviable 24% helping EPS to rise 84% from the year-ago tally. Its comparable sales for brick-and-mortar stores rose 11% in the second quarter while online sales nearly tripled from a year earlier.

2. Information Technology – NVIDIA (NVDA) up 10%, Synopsys (SNPS) up 9%, and Apple (AAPL) up 8%

NVIDIA (NVDA), shares rose on excitement before and after the chipmaker reported second-quarter results. The semiconductor chipmaker’s sales and EPS rose 50% and 76%, respectively from the year-ago tally with both measures exceeding analysts’ forecast. NVIDIA upped the sales and EPS guidance for the current quarter.

Semiconductor design software company Synopsys (SNPS) emulated NVIDIA, reporting a ‘beat-and-raise’ quarter.

Apple (AAPL) shares extended their surge. Being the first U. S. company to reach the $2 trillion market-cap milestone, the upcoming 4-for-1 stock split, and opportunities from the 5G-driven iPhone refresh cycle added to the buzz.

3. Homebuilders – D. R. Horton (DHI) up 8% and Lennar (LEN) up 7%

Shares of homebuilders D. R. Horton (DHI) and Lennar (LEN) rallied on strong housing industry data. Home-builder confidence rose to a new record high in August and sales of existing homes rose 8.7% year-over-year in July.

Other S&P 500 top 10 winners included:

• Semiconductor microcontroller maker Microchip Technology (MCHP) up 8%
• Software companies salesforce.com (CRM) up 7% and Autodesk (ADSK) up 6%

Looking ahead to the week of August 24

* Software companies salesforce.com (CRM), Intuit (INTU), and Autodesk (ADSK) feature prominently among the 16 S&P 500 members scheduled to report earnings next week. Medical equipment heavyweight Medtronic (MDT) and discount retailers Dollar General (DG) & Dollar Tree (DLTR) report as well.

* The Federal Reserve’s annual Jackson Hole symposium starts on Thursday. Keeping with the times, this is an online event this year. Economists are hoping Fed Chairman Powell goes beyond affirming his extraordinary support for the pandemic-stricken economy, provides a sense of how long zero percent interest rates will be in place. They hope to glean more of the Fed’s thoughts on yield curve management and inflation targeting.

* Investors and energy commodity traders are watching the evolution of two tropical storms Laura and Marco that are heading into the Gulf of Mexico and could make landfall some time mid-week. On the political front, the Republican convention will be held next week.
 

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Steadying COVID-19 case count helped stocks sensitive to the ‘reopening’ of the economy perform well last week. The stalemate in Washington on the new coronavirus stimulus package did not deter investors. Economic data gave a mixed picture.

The average daily count of new COVID-19 cases in the U. S. trended modestly lower last week to 54,900 from 56,100 the week before. Russian President Putin announced that an institute in Moscow has registered Sputnik-V as the first coronavirus vaccine in the world.

Washington lawmakers were unable to move forward with a coronavirus stimulus bill, despite the legal and logistical questions remaining on the executive orders announced by President Trump on Saturday, August 8. Further negotiations are unlikely before September 8 since the Senate is in recess and House Representatives have left for the month.

In economic data, weekly jobless claims surprised to the upside while retail sales did not. Initial weekly jobless claims for the week ending August 8 dropped to 963,000, better than economists’ 1.1 million estimate. This marked the lowest weekly jobless claims since mid-March. Retail sales rose 1.2% in July from June, lower than economists’ 1.9% forecast.

For the week ending August 14, the S&P 500 (SPY) rose 0.7%.

Eight of the 11 sectors gained.
 

Leaders and laggards for the week ending August 14, 2020.

Industrials (XLI), energy (XLE), and consumer discretionary (XLY) led the S&P 500.

Utilities (XLU), real estate (XLRE), and communication services (XLC) lagged the benchmark.

Advancing stocks in the S&P 500 outnumbered decliners by a wide 2-to-1 ratio.

As many as 10 of the S&P 500 members advanced double-digits.

For the second straight week, the S&P 500’s top 10 winners had a smaller market capitalization tilt. The median market cap of the top 10 winners was below $13 billion. Six of the top 10 winners were consumer discretionary stocks led by cruise operators and resort & casino operators.

1. Cruise operators – Royal Caribbean (RCL) up 16% and Norwegian Cruise Lines (NCLH) up 13%

Royal Caribbean (RCL) shares with a 16% gain were the S&P 500’s top performer last week. Although Royal Caribbean’s quarterly loss exceeded analysts’ estimate, investors focused on quarterly revenue of $176 million topping analysts’ $44 million forecast.

Shares of Norwegian Cruise Lines (NCLH) and Carnival Corp. (CCL) joined shares of Royal Caribbean in the rally. Carnival’s 9% gain fell short of the top 10 cut-off.

2. Resort & casino operators – Wynn Resorts (WYNN) and MGM Resorts International (MGM) up 15% each

Shares of casino operators Wynn Resorts (WYNN), MGM Resorts International (MGM), and Las Vegas Sands (LVS) shot up on optimism of gambling revenues rising soon.

The Chinese enclave of Macao allowed tourist visas from the city of Zhuhai in China and non-tourist visas from all mainland China provinces. All three companies have significant operations in Macao. Las Vegas Sands shares’ 9% gain made them the 11th best performer in the S&P 500.

Separately, Barry Diller’s IAC/InterActiveCorp. (IACI) announced a 12% stake in MGM Resorts, eyeing growth in online gaming.

3. Freight & logistics – FedEx (FDX) up 14%

FedEx (FDX) shares rose after Bernstein upgraded their rating from ‘Market Perform’ to ‘Outperform’. Bernstein noted FedEx’s improving parcel pricing and delivery margin from the rapid rise in e-commerce penetration.

Other double-digit gainers in the top 10 winners included:

• Halliburton (HAL) from the energy sector up 12%
• Ulta Beauty (ULTA) and Tapestry (TPR) from the consumer discretionary sector up 11% and 10%, respectively
• Corteva (CTVA) from the basic materials sector up 10%
• Simon Property Group (SPG) from the real estate sector up 10%

Looking ahead to the week of August 17

* Investors will get insights on the performance of retailers next week. Nine of 18 S&P 500 members reporting earnings are retailers. The list of reporting retailers includes Walmart (WMT), Home Depot (HD), Lowe’s (LOW), Target (TGT), and TJX Companies (TJX). Outside of the retailing group, semiconductor chipmaker NVIDIA (NVDA), cosmetics company Estee Lauder (EL), and farm equipment maker Deere (DE) step up to the earnings podium.

* Wall Street is watching to see if weekly jobless claims stay below 1 million for a second straight week. Economists forecast 990,000 in weekly jobless claims.

* In this relatively light week, minutes from the Fed’s last meeting along with housing starts and existing home sales data are likely to garner attention.
 

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Stronger-than-expected economic data helped stocks to rally broadly last week. A slowdown in daily new COVID-19 case count also helped the cause. While the NASDAQ Composite made the headlines after claiming a new milestone, small-cap stocks gained more.

Employment data surprised to the upside. The U. S. economy added a higher-than-expected 1.76 million jobs in July. The unemployment rate fell to 10.2% from 11.1% in June. Reversing recently increases, the number of weekly jobless benefit claims fell to a three-week low of 1.19 million.

The daily number of new COVID-19 cases in the U. S. trended lower for a second straight week after peaking at over 78,000 on July 24. The 7-day average of this metric dropped to 55,000 at the end of last week, down from about 65,000 a week ago.

The effort to approve a new COVID-19 stimulus plan fell apart in Washington. The extension of the $600 a week enhanced federal unemployment benefits provided to be a sticking point. Democrats wanted to extend the benefit at the same amount while Republicans wanted a lower weekly rate.

U. S. stocks had their best August start since 2009. The technology-heavy NASDAQ Composite index crossed the 11,000 milestone for the first time. Yet, small-cap stocks were the leaders in last week’s rally. The small-cap Russell 2000 gained 6.0% while the NASDAQ Composite gained 2.5%.

For the week ending August 7, the S&P 500 (SPY) rose 2.5%.

Advancing stocks in the S&P 500 outnumbered decliners by a wide 7-to-2 ratio.

Leaders and laggards for the week ending August 7, 2020.

All of the 11 sectors gained.

Industrials (XLI), financials (XLF), and energy (XLE) led the S&P 500.

Real estate (XLRE), health care (XLV), and utilities (XLU) lagged the benchmark.

As many as 24 of the S&P 500 members advanced double-digits.

The S&P 500’s top 10 winners also had a smaller market capitalization tilt for a change. Nine of them had a market capitalization below $10 billion. The top 10 winners included stocks from the materials, healthcare, and industrials sectors.

1. Materials – Mosaic (MOS) up 28% and Sealed Air (SEE) up 14%

Shares of Mosaic (MOS) were the week’s top performer in the S&P 500. The fertilizer producer surprised investors reporting $0.11 a share in the second-quarter profit compared to analysts’ forecast for $0.01 a share loss. Mosaic provided a confident assessment for the remainder of 2020, saying N. American sales volumes have improved and COVID-19 has had a limited impact on its business.

Packaging products maker Sealed Air (SEE) reported $0.76 in EPS compared to analysts’ $0.55 a share forecast. The Bubble Wrap maker also raised its full-year EPS forecast by 9%.

2. Health care – Varian Medical Systems (VAR) up 22%

The U. S. maker of cancer treatment equipment & software received a buyout offer from Germany’s Siemens Healthineers. The $16.4 billion offer translates to $177.50 per Varian share, a 24% premium.

3. Industrials – American Airlines (AAL) up 17%, Quanta Services (PWR) up 16%, and Howmet Aerospace (HWM) up 15%

American Airlines (AAL) and other airline stocks rallied after President Trump voiced his support for a bipartisan effort in Congress to provide an additional $25 billion to the struggling air carriers.

Engineering & construction firm Quanta Services (PWR) and jet engine components maker Howmet Aerospace (HWM) reported EPS above analysts’ forecasts. The former raised its full-year EPS guidance while the latter lowered it.

Other double-digit gainers in the top 10 winners included:

• MGM Resorts International (MGM) and Kohl’s (KSS) from the consumer discretionary sector up 18% and 16%, respectively
• Devon Energy (DVN) from the energy sector up 15%
• Assurant (AIZ) from the financial sector up 14%

Looking ahead to the week of August 10

* Wall Street has the first opportunity to react to President Trump’s executive orders when trading opens on Monday. On Saturday, August 8, Trump signed four orders one of which provides as much as $400 a week in enhanced unemployment benefits. The others provide payroll tax relief, extend an eviction moratorium, and allow student loan payment deferrals.

* Investors are waiting to see if the nationwide count of daily new COVID-19 declines for a third straight week. They are also awaiting China’s response to Trump’s executive orders barring U. S. companies from doing business with the Chinese social media companies Tencent (TCEHY) and ByteDance after September 20.

* The second-quarter earnings reporting season continues to taper down. Applied Materials (AMAT) and Cisco Systems (CSCO) are among the S&P 500 names that will garner investor attention. Duke Energy (DUK), Marriott International (MAR), and Sysco (SYY) report as well.
 

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Strong earnings from technology titans and comforting comments from the Fed helped stocks maintain their uptrend even as economic data and Congress threatened to derail them. For once, the continuing increase in the COVID-19 case count appeared to slip to the backburner.

With nearly 170 of the S&P 500 members reporting last week, earnings reports played a key role in impacting stock prices. Most notably, strong earnings from Apple, Amazon, and Facebook helped the large-cap stock indexes to advance. Supporting the rally, the Federal Reserve reiterated its pledge to support the U. S. economy until the COVID-19 threat passes.

In economic data, the Commerce Department estimated the U. S. gross domestic product to have contracted at a 32.9% annualized rate in the second quarter, its steepest contraction since the Great Depression.

Congressional Democrats, Republicans, and the White House were at odds on the new coronavirus relief bill while the $600 per week enhanced unemployment benefits expired at the end of the week.

For the week ending July 31, the S&P 500 (SPY) rose 1.8%.

However, advancers in the S&P 500 edged out decliners only by a slim 7-to-6 ratio.

Leaders and laggards for the week ending July 31, 2020.

Seven of the 11 sectors gained.

Information technology (XLK), real estate (XLRE), and communication services (XLC) led the S&P 500 (SPY).

Energy (XLE), materials (XLB), and financials (XLF) lagged the benchmark.

As many as 17 of the S&P 500 members advanced double-digits.

With a gain of 27%, shares of apparel retailer L Brands (LB) was the week’s top performer in the S&P 500. The owner of the Bath & Body Works and Victoria’s Secret retail chains announced plans to cut $400 million in annual costs and reaffirmed its commitment to separate the Bath & Body Works and Victoria’s Secret businesses.

The S&P 500’s top 10 winners included several mega-cap companies that reported quarterly earnings.

1. United Parcel Service (UPS) up 21%

The package delivery giant benefited as demand for deliveries spiked from an increase in online shopping due to the pandemic. UPS reported $2.13 per share in second-quarter EPS on sales of $20.5 billion, beating analysts’ $1.07 per share EPS forecast on estimated sales of $17.5 billion.

2. Qualcomm (QCOM) up 19%

The smartphone chipmaker announced a settlement, as well as a new long-term, global patent license agreement with Huawei. Qualcomm also reported EPS of $0.74 a share in its fiscal third-quarter, higher than the $0.44 a share analysts’ forecast. The company’s sales guidance for the current quarter topped analysts’ estimate.

3. Apple (AAPL) up 15%

The consumer electronics titan known for its iPhones, iPads, and Macs reported $2.58 in fiscal third-quarter EPS on $59.7 billion sales. Both metrics topped analysts’ estimates, rising 18% and 11% year-over-year, respectively. While Apple did not guide for the current quarter, it announced a 4-for-1 stock split.

Other double-digit gainers in the top 10 winners included:

• Qorvo (QRVO) up 15% and PayPal (PYPL) up 14% from the technology sector
• Hologic (HOLX) up 13% and Varian (VAR) up 12% from the health care sector
• Church & Dwight (CHD) up 12% from the consumer staples sector
• Leggett & Platt (LEG) up 12% from the consumer discretionary sector

Looking ahead to the week of August 3

* Wall Street will be focused on politics next week. Investors are concerned over the delay in extending the enhanced unemployment benefits. They are watching to see if Congress can come together and approve the next stimulus package in the first week of August. The likely Democratic Presidential nominee, Biden is also expected to name his running mate in the coming week.

* While another busy earnings week is in store, it does not have the same buzz as the past one when four of the five FAANG members reported. Booking Holdings (BKNG), Bristol-Myers Squibb (BMY), CVS Health (CVS), Disney (DIS), Fiserv (FISV), and T-Mobile US (TMUS) are among the 120 S&P 500 members reporting this week.

* In economic data, the July jobs report is the big one particularly in light of recent weekly jobless claims data showing a loss of momentum in hiring. According to Refinitiv, economists estimate 1.4 million jobs to have been added in July. They expect the unemployment rate to fall to 10.7%.
 

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Stocks benefited from promising COVID-19 vaccines trial results and an agreement in Europe for a rescue fund. However, stubbornly high jobless claims and deteriorating Sino-U.S. relations pressured stocks. While individual stocks moved significantly, the weekly change for the S&P 500 and its sectors was muted ahead of the upcoming busy week.

Stocks started the past week on a strong note after Pfizer (PFE) and German biotechnology company BioNTech reported Phase 1/2 clinical trial data for their COVID-19 vaccine candidate. The data showed their candidate to be both safe and effective. The 27-nation European Union bloc reached agreement on an $860 billion coronavirus rescue fund after four days of intense negotiations.

The uptrend in stocks faltered in the later part of the week. Weekly initial jobless claims increased for the first time since late March. The Labor Department reported an increase in initial benefit claims to 1.4 million. Economists’ had forecasted the claims to decline to 1.3 million.

Political tension between the U. S. and China rose after the U. S. accused China of ‘stealing intellectual property’ and instructed it to close its consulate in Houston. In retaliation, China ordered the U. S. to close its consulate in Chengdu.

For the week ending July 24, the S&P 500 (SPY) fell 0.3%.

Advancers however edged out decliners by a 5-to-4 ratio.

Leaders and laggards for the week ending July 24, 2020.

Six of the 11 sectors gained.

Energy (XLE), financials (XLF), and consumer discretionary (XLY) led the S&P 500 (SPY).

Information technology (XLK), communication services (XLC), and health care (XLV) lagged the benchmark.

The S&P 500’s top 10 winners last week included Advanced Micro Devices (AMD) along with hospital operators, housing-related companies, and energy companies.

Shares of semiconductor chipmaker Advanced Micro Devices surged 26% to be the week’s top performer in the S&P 500. AMD announced a new line of desktop processors based on its 7-nanometer manufacturing process while its key competitor Intel (INTC) delayed the launch of such chips. AMD’s six-month head start should help in gaining market share.

1. Hospital operators – HCA Healthcare (HCA) up 18%, Universal Health Services (UHS) up 11%

Shares of HCA Healthcare and Universal Health Services rose after the former reported $3.23 a share profit in the second quarter compared to analysts’ forecast of $0.39 a share loss. HCA owed part of its outperformance to Uncle Sam as it received over $800 million in federal stimulus money during the quarter.

2. Housing-related companies – PulteGroup (PHM) & NVR, Inc. (NVR) up 14% each, Whirlpool (WHR) up 11%

Shares of homebuilders PulteGroup and NVR as well as home appliances maker Whirlpool rose after their second-quarter per-share earnings topped analysts’ forecast. PulteGroup and NVR grew the dollar value of their order backlog over 13%. Whirlpool’s North American & European product demand strengthened in June.

3. Energy companies – Noble Energy (NBL) up 13%, Halliburton (HAL) up 12%

Chevron (CVX) offered to buy oil & gas producer Noble Energy in an all-stock transaction valued at $5 billion. Halliburton reported $0.05 a share in second-quarter profit versus analysts’ forecast of $0.11 a share loss. Bank of America upgraded Halliburton shares to Buy, citing current cost reduction programs significantly benefiting cash flow during the next oil & gas upcycle.

Looking ahead to the week of July 27

The coming week is a busy one on several fronts.

* Nearly 170 S&P 500 members including several sector leaders are scheduled to report second-quarter earnings in what is the busiest week of this reporting season. The list of reporting companies includes Alphabet (GOOG), Apple (AAPL), Amazon (AMZN), ExxonMobil (XOM), Pfizer (PFE), Procter & Gamble (PG), and Visa (V).

* Economists are awaiting the Commerce Department’s first read of the second-quarter gross domestic product. The report should show the impact of COVID-19 shutdowns on the economy. Economists’ consensus estimate is for the economy to contract ~35% in the second quarter.

* Wall Street is keeping an eye on Senate Republicans. They need to unveil their stimulus proposal early next week for it to have any chance of being passed into law before the $600 per week enhanced unemployment benefit runs out on July 31.

* The Federal Reserve Chair Powell is scheduled to hold a Press Conference after the Federal Open Market Committee discusses interest rate policy. The FOMC is expected to leave benchmark interest rates unchanged.
 

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