Major Benchmarks to Close Out Tumultuous Week With Wins

The week was full of record highs for the major benchmarks

Deputy Editor
Apr 16, 2021 at 3:14 PM
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It's just the second full week of April, but this has already proven to be a wild month. The week started off on a shaky foot, with the major indexes falling on Monday as investors awaited the initial batch of first-quarter earnings reports. Additionally, Federal Reserve Chairman Jerome Powell gave a policy update, and U.S. President Joe Biden addressed the global chip shortage and his infrastructure plan. Things began to pick up on Tuesday, with the S&P 500 Index (SPX) logging a record high close, though the blue-chip index fell again as Johnson & Johnson (JNJ) paused its vaccine distribution amid blood clotting worries. 

Wednesday saw the Dow Jones Industrial Average (DJI) boosted by a strong batch of bank earnings, while the Nasdaq Composite (IXIC) and S&P 500 sank as Big Tech took a breather. By Thursday, the Dow and S&P 500 both closed at fresh highs, with the former surpassing a major milestone by rising above the 34,000 level for the first time. Additionally, the Nasdaq notched a triple-digit win thanks to a decline in the 10-year Treasury yield. By Friday, the Dow was on track for its third-straight win, scoring another intraday record too, while the S&P 500 hit a high of its own. All three major indexes were also on track for substantial weekly wins.

Analysts Dish out Plenty of Notes

Analysts were far from shy this week, dishing out lots of love to pair with a little bit of skepticism. Concerning the latter, blue-chip component 3M (MMM) landed a bear note from Deutsche Bank, with the firm calling the stock a "catalyst call" sell, following its wild pre-earnings outperformance. Elsewhere, this restaurant stock hit fresh highs on an "outperform" rating, with the analyst in question praising the company's sales and current-quarter expectations.

Meanwhile, Tinder parent Match Group (MTCH) was upgraded as one analyst noted the stock's future potential. CrowdStrike (CRWD) notched a bull note in the form of a "buy" rating thanks to the rising importance of cybersecurity. Lastly, United Airlines (UAL) was praised amid recovering air travel demand, though traders brushed off the upgrade.

Bank Earnings Pour In

Bank stocks were at the forefront of investors' newsfeed this week, as earnings from the sector helped the major indexes to weekly wins. Kicking things off, blue-chip component Goldman Sachs (GS) started the week with earnings and revenue that blasted past Wall Street's estimates. In fact, the latter more than doubled from a year ago. Bank of America (BAC) reported top- and bottom-line beats for the first quarter, boosted by wins in investment banking and trading. Wells Fargo (WFC) also chimed in with an earnings and revenue win, and bull blasted the equity as a result. The stock also pulled back to a historically bullish trendline, which could bode well for WFC in coming weeks.

Packed Week of Earnings Ahead to go with Fed Updates

Coming up, investors have a busy week to look forward to. For one, there's a slew of Federal Reserve updates to come, as well as consumer data to go alongside another round of weekly jobless claims report. In addition, earnings season is upon us, and big names like American Airlines (AAL), Coca-Cola (KO), Dow (DOW), IBM (IBM), and Southwest Airlines (LUV) set to report. In the meantime, traders can mull over the current bullish climate and the associated risks, or check out Schaeffer's Senior Quantitative Analyst Rocky White's breakdown of the SPY's buy-to-open put/call volume ratio.


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