The stock market finished the week positively, with the S&P 500 (SPX) rising by 1.3% to nearly touch its 50-day moving average at 5,129 points, while the Nasdaq Composite (COMPX) saw a 2.0% increase. The Russell 2000 (RUT) also climbed by 1.0%, bringing its year-to-date gain to 0.4%.
Market sentiment was influenced by the April employment report, which showed weaker-than-expected job growth. This tempered fears of an imminent rate hike without raising concerns about overall labor market health. Key figures included:
- Nonfarm payrolls at 175,000 versus the expected 250,000
- Average hourly earnings increase of 0.2%, below the anticipated 0.3%
- Unemployment rate rose to 3.9%, against a forecast of 3.8%
- Average workweek hours at 34.3, slightly less than the 34.4 expected
Declining Treasury yields also played a role in boosting stock market performance. The yield on the 10-year note dropped by seven basis points to 4.50%, and the 2-year note yield decreased by seven basis points to 4.81%.
Stock movements were notable with Apple (AAPL, Financial) surging 6.0% after announcing better-than-expected quarterly results and a $110 billion share repurchase program. Amgen (AMGN, Financial) also stood out with an 11.8% gain following positive earnings and a successful trial update for its drug MariTide.
However, not all news was positive, as Expedia (EXPE, Financial), Fortinet (FTNT, Financial), Ingersoll-Rand (IR, Financial), and DaVita (DVA, Financial) experienced significant drops post-earnings announcements.
The energy sector was the only S&P 500 category to close lower, while information technology, communication services, and materials sectors led with strong gains.
Year-to-date performance metrics include:
- S&P 500: +7.5%
- Nasdaq Composite: +7.6%
- S&P Midcap 400: +5.3%
- Dow Jones Industrial Average: +2.6%
- Russell 2000: +0.4%
Other economic data reviewed included the April S&P Global US Services PMI and ISM Non-Manufacturing PMI, which indicated a slight contraction in service sector activity, raising concerns about inflation pressures despite overall economic growth.
No significant U.S. economic data is expected to be released next Monday.
Guru Stock Picks
Vanguard Health Care Fund has made the following transactions:
- Reduce in LSE:AZN by 3.71%
- Sold out in HKSE:02359
- Add in PCVX by 11.33%
- New position in AKRO
Today's News
Warren Buffett (Trades, Portfolio)'s Berkshire Hathaway (BRK.B) eagerly awaited Q1 earnings release coincides with its annual shareholder meeting, a key event following the death of Charlie Munger. Investors are particularly keen on updates about Berkshire's cash reserves, which stood at approximately $167.6 billion as of the end of last year. This meeting, described as the "Woodstock for capitalists," offers rare direct insights from Buffett and his executives.
Apple (AAPL, Financial) announced a historic $110 billion share buyback, the largest in U.S. history, sending its shares up significantly. This move came after the tech giant reported better-than-expected quarterly results, particularly noting strong performance in China and an overall robust financial health.
Palantir Technologies (PLTR, Financial) is set to report its Q1 earnings with expectations of increased revenue and earnings per share, amid significant interest in its AI capabilities. The firm's performance remains a critical watch, especially given its substantial stock price increase over the past year.
Realty Income (O, Financial) is anticipated to show modest earnings growth but a significant revenue increase in its upcoming Q1 report. The net-lease REIT's performance remains crucial under the current interest rate environment, with its strong balance sheet providing some reassurance to investors.
Meta Materials (MMAT, Financial) announced a drastic workforce reduction of about 80% in response to liquidity challenges and ongoing financial struggles. This significant cutback highlights the company's desperate measures to remain operational amidst financial turmoil.
Viking Holdings (VIK, Financial) successfully closed its IPO, marking a significant entry into the market with shares appreciating post-listing. The company's market valuation now positions it as a notable player in the cruise industry, just behind industry giants.
Occidental Petroleum (OXY, Financial) is reportedly exploring the sale of its Permian Basin assets, potentially fetching over $1 billion. This move is part of Occidental's broader strategy to reduce its substantial debt burden, which could reshape its operational focus and financial stability.
GoDaddy (GDDY, Financial) reported strong Q1 financial results, surpassing estimates and reinforcing confidence in its operational strategy. The web hosting company's positive performance and ongoing share repurchases reflect its robust business model and growth trajectory.
Block (SQ, Financial) delivered a robust Q1 report with revenues and earnings exceeding expectations, supported by diverse revenue streams from its various payment platforms. The fintech giant's forward-looking statements suggest continued growth, reassuring investors about its market position.
Lucid Motors (LCID, Financial) prepares to announce its Q1 earnings amid a challenging environment for EV makers, characterized by cooling demand and aggressive pricing strategies. The company's recent financial infusion from its majority shareholder highlights its strategic moves to stabilize operations.
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