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Stocks Hit Record Highs Despite Weakness in Financial, Energy Sectors

Retail earnings and a number of drug stocks were in focus this week

Jun 2, 2017 at 2:44 PM
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With the stock market closed on Monday for Memorial Day, the trading week opened on Tuesday, with stocks falling out of the gate. Investors were digesting weakness in oil prices early on, and the energy sector would remain in focus throughout the week, after President Donald Trump announced his intention to withdraw the U.S. from the Paris climate agreement. It was also a huge week for economic data, including an impressive ADP payrolls report, though a disappointing nonfarm payrolls report put a June rate hike in question. 

Major Indexes Rise Despite Bank Stock Slide

The uncertainty surrounding monetary policy -- and a warning of a current-quarter slowdown -- put pressure on bank stocks, especially Dow components JPMorgan and Goldman Sachs. Considering historical data for June, the financial sector could continue to struggle in the near term, but this European bank stock could be the outlier. Despite the weakness from this group, the Dow, S&P 500 Index (SPX), and Nasdaq Composite (COMP) closed out May in positive territory, and are also eyeing another weekly win, touching record highs in the process. As for the CBOE Volatility Index (VIX), it just finished its weakest May on record. 

The Amazon Stock Story No One's Talking About

Outside of the financial and energy sectors, retail stocks remained in focus. Michael Kors stock and Express stock both sold off after earnings, though an under-the-radar sector peer enjoyed its best day ever. Elsewhere, Lululemon shares pleased options traders with another huge post-earnings move, and Canada Goose had a good showing in its earnings debut. Amazon stayed hot as well, topping $1,000 for the first time, but there's a different Amazon stock story no one's talking about. 

Tech, Healthcare Stocks Make Headlines

Speaking of hot stocks, Tesla shares continued their ascent, reaching record highs in the process. Plenty of tech stocks made notable moves, led by a big earnings win for BOX stock, while Workday and Hewlett Packard both sank after their quarterly results. And while analysts are "moving to the sidelines" on Roomba maker iRobot, these two underloved electronics stocks could be set to run higher.

Several healthcare stocks also made headlines, with few making bigger moves than Protagonist Therapeutics Inc (NASDAQ:PTGX) and Minerva Neurosciences Inc (NASDAQ:NERV). Upbeat patent news lifted Celyad stock, and EXACT Sciences got a boost from a promising insurance development. Going forward, this hot drug stock could get iced this month, and rallying Medtronic stock could go even higher. 

June Presents Trading Opportunities for Bulls and Bears Alike

Apple's Worldwide Developers Conference (WWDC) will be in focus early next week, and traders should keep an eye on these three Apple suppliers as the event unfolds. For bulls, our list of the best stocks to buy in June could be a good jumping off point, and options traders should read how to profit off the month's low volatility. On the flip side, these two airline stocks could crush your portfolio in June. Of course, going by a very rare volatility signal, the broader stock market could experience weakness soon. 
 
 

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