The S&P 500 and the Dow Jones Industrial Average (DJIA) ended the week with gains, but the NASDAQ declined as equities in the technology sector dropped 0.6%. The tension in Ukraine also impacted the movement of the stock markets.
In an interview with Bloomberg, Joe Bell, senior equity analyst at Schaeffer’s Investment Research commented, “Markets greet uncertainty with selling, especially entering a weekend. Technically, the market is kind of overextended as well. It’s just an overbought situation. You’re having people take profits.”
Stock markets in the United States are set to enter another bull market. If the economy continues to strengthen, the markets will experience the sixth consecutive bull market, which started in March 2009. The S&P 500 gained 175% from its 12-year low. The increase was primarily driven by the huge quantitative easing implemented by the Federal Reserve.
Top value fund managers are ready for the small cap bear market to be done
During the bull market, small caps haven't been performing well, but some believe that could be about to change. Breach Inlet Founder and Portfolio Manager Chris Colvin and Gradient Investments President Michael Binger both expect small caps to take off. Q1 2020 hedge fund letters, conferences and more However, not everyone is convinced. BTIG strategist Read More
Yesterday, Federal Reserve Chairperson Janet Yellen said the Federal Reserve will consider changing its strategy regarding the tapering of the monthly bond buying program if the economic growth slows down. Yellen previously stated that the economy is strong enough to withstand the tapering.
During the fourth quarter, the economic growth of the United States was lower than expected. The gross domestic product (GDP) expansion was 2.4% on an annualized rate compared with the 3.2% estimate provided by the Department of Commerce.
Andres Garcia-Amaya, global market strategist at JPMorgan Chase & Co, mutual fund unit opined, “Although they don’t expect to change tapering, Yellen did give a nod to if the economic data tells us that over the next couple months it’s not just weather, then they will re-evaluate. The market took it on a stride and says, ‘All right, the Fed still supports us.”
- Dow Jones Industrial Average (DJIA)- 16,323.38 (+0.31%)
- S&P 500- 1,859.51 (+0.28%)
- NASDAQ- 4,308.12 (-0.25%)
- Russell 2000- 1,183.18 (-0.40%)
- EURO STOXX 50 Price EUR- 3,149.23 (+0.46%)
- FTSE 100 Index- 6,809.70 (-0.01%)
- Deutsche Borse AG German Stock Index DAX- 9,692.08 (+1.08%)
Asia Pacific Markets
- Nikkei 225- 14,841.07 (-0.55%)
- Hong Kong Hang Seng Index- 22,836.96 (+0.04%)
- Shanghai Shenzhen CSI 300 Index- 2,178.97 (+1.15%)
Stocks in Focus
The stock price of Deckers Outdoor Corp (NASDAQ:DECK) declined more than 12% to $74.34 per share after the company issued earnings guidance that is lower than the expectations of Wall Street analysts. The maker of popular UGG brand boots reported $4.04 earnings per share for the fourth quarter, higher than the $3.80 consensus estimate. However, the company anticipated that it will incur a loss of $0.16 per share in the first quarter. Analysts projected a profit of $0.10 per share.
The shares of Monster Beverage Corp (NASDAQ:MNST) gained almost 4% to $74 per share after the company reported better than expected quarterly revenue. Monster Beverage said its revenue was $540.9 million compared with the $522 million consensus estimate of Zacks Equity Research. The company posted $0.44 earnings per share, slightly lower than the $0.45 consensus estimate of the firm.
The Kroger Co (NYSE:KR) gained 4.48% to $41.94 per share after Deutsche Bank analyst Karen Short said the shares of the company are trading at a substantial discount. Short said, “We believe that KR stands apart from other conventional grocers given its much greater scale, stronger local market share positions, broad private brand portfolio, and very consistent history of positive non-fuel ID’s.”