Stocks on pace for first winning month since crash

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Stocks are on the verge of achieving something they haven’t done since January: Chalk up a winning month.

The S&P 500 was little changed between Friday, April 20, and Friday, April 27. Still the index is up 1.1 percent so far in April, and continues to hold support at its 200-day moving average.

Last week was the busiest in terms of first-quarter earnings. Most of them beat expectations and gave investors reason to remain confident. Amazon.com (AMZN) maintained its torrid growth in e-commerce and data services. Facebook (FB) defied fears of the Cambridge Analytica scandal hurting the bottom line. Microsoft (MSFT) and Intel (INTC) continued to evolve into cloud-computing powerhouses. See our earnings recap for more.

Other headlines supported the bulls. Jobless claims fell more than expected to their lowest level since 1969, yet another indication of the strong employment market. Existing-home sales, consumer confidence and first-quarter gross domestic product beat expectations.

Apart from the big tech names, Boeing (BA) surprised to the upside again but remained in a tight range. Guidance from Caterpillar (CAT) worried some investors, and 3M (MMM) cratered after missing estimates.

The biggest surprise may have been Chipotle Mexican Grill (CMG). The once-beleaguered burrito chain beat estimates and showed signs it’s recovering from high-profile food-poisonings since 2015. Its 29 percent surge made CMG the best performing member of the S&P 500 index last week. SVB Financial (SIVB), a regional bank based in Silicon Valley, took the No. 2 spot on the heels of a strong earnings report.

Uncertainty about a key mine in Indonesia, on the other hand, landed copper producer Freeport-McMoRan (FCX) at the bottom of the totem pole, down 21 percent. Auto-parts supplier LKQ (LKQ) and Charter Communications (CHTR) also fell sharply on weak results.

The best-performing sectors of the week were real-estate investment trusts and utilities, up nearly 3 percent. Both tend to benefit from lower interest rates and bounced as bond yields showed signs of topping. Industrials led to the downside with a 3 percent drop.

This week’s calendar is even busier, with plenty of big events and earnings.

Today brings personal income and spending, plus pending home sales and results from McDonald’s (MCD).

All eyes shift to Apple (AAPL) tomorrow afternoon, with investors fearing bad iPhone numbers but hoping for some kind of stock-buyback announcement. Drug makers Pfizer (PFE), Merck (MRK) and Gilead Sciences (GILD) are also due, along with data-storage company Seagate Technology (STX). Economic reports include the Institute for Supply Management’s manufacturing index and construction spending.

Wednesday’s Fed day, with Jerome Powell’s merry band of central bankers expected to leave interest rates unchanged. ADP’s private-sector jobs report and oil inventories come out as well.

The next session brings jobless claims, factory orders and ISM’s service-sector index.  The week concludes Friday morning with non-farm payrolls — always a closely watched report.

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David Russell is VP of Content Strategy at TradeStation. Drawing on nearly two decades of experience as a financial journalist and analyst, his background includes equities, emerging markets, fixed-income and derivatives. He previously worked at Bloomberg News, CNBC and E*TRADE Financial. Russell systematically reviews countless global financial headlines and indicators in search of broad tradable trends that present opportunities repeatedly over time. Customers can expect him to keep them appraised of sector leadership, relative strength and the big stories – especially those overlooked by other commentators. He’s also a big fan of generating leverage with options to limit capital at risk.