Craig Johnson’s

Stock Market Summary

Monday, May 2, 2016

  • Stocks were lower last week. The major market indices all dropped more than 1% for the week. The biggest decline was the Nasdaq Composite which dropped 2.67%. The Nasdaq Composite has recorded a string of seven consecutive trading days lower.
  • An exceptionally high number of earnings reports released by companies dominated trading last week. In addition, the conclusion of the two day Federal Open Market Committee meeting, economic reports such as the Durable Goods Orders, first quarter GDP and the Chicago Purchasing Manager’s Index, that were weaker than expected and a lack of further monetary easing by global central banks that some were expecting all weighed on the stock market.
  • Biotechnology and technology stocks felt the brunt of selling as earnings reports coming from these companies with just a few exceptions didn’t generate the high expectations that many were judged by.
  • Two companies that generated lots of excitement from their earnings reports were Amazon and Facebook. Both continue to show massive growth, which is quite amazing when the size of their companies is considered.
  • Like last week, this week will have the largest number of reports being released during the entire second quarter earnings season.
  • The sheer number of earnings reports will overshadow the general market activity captivating investors and traders focus as well as impacting specific stocks and industries.
  • The short, intermediate and long term trends are all higher. The first upside target to watch for will be the November-December highs for the S&P 500. The Dow Jones Industrial Average is marching towards an all-time high, while the Nasdaq Composite and the Russell 2000 are still quite a ways from retaking their recent and all-time highs.

Sources: bankrate.com, bloomberg.com, briefing.com, Dow Jones News, Financial Times, finviz.com, Investor's Business Daily, marketwatch.com, seekingalpha.com, Thomson Reuters/First Call, U.S. Dept of Treasury, yahoo.com and individual company web sites and press releases.

Leonetti & Associates, LLC views or opinions are as of a certain date and subject to change without notice.  The material contained herein is for informational purposes only and obtained from sources we consider reliable. We make no guarantee as to its accuracy or completeness.  References to specific securities and industries/sectors should not be considered recommendations to buy or sell any security or advisory service.  Past performance is not a guarantee of future results.

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