Lackluster Week Capped in Market Volatility

Investors buzzed about Fed updates and Big Tech earnings during the last week in April

Deputy Editor
Apr 30, 2021 at 3:43 PM
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Anticipation over another big round of earnings reports gripped Wall Street this week, dictating much of the market's movement and keeping investors at the edge of their seats. Sentiment on Monday was mostly lackluster. The three major indexes clung close to breakeven for the majority of the day, though the Nasdaq and S&P 500 managed to pull record closes, bolstered by optimistic Covid-19 comments from Dr. Anthony Fauci. Fears over inflation kept the Dow in check, though, while the dire coronavirus situation in India also gripped headlines. Tuesday's trading was also somewhat subdued, though the day was jam-packed with record-setting economic data and investors looked toward a barrage of tech earnings set to report after the session's close. 

Tech reports and comments from Fed Chair Jerome Powell wound up shifting markets lower on Wednesday. The central bank's decision to keep interest rates near zero was overshadowed by Powell's assertions that economic recovery is still "uneven and far from complete." The Dow turned volatile on Thursday but eventually roared to a triple-digit pop, thanks to impressive quarterly reports from the likes of Apple (AAPL) and Facebook (FB). This surge proved short-lived, however, and today stocks are headed for more losses, both on the day and the week. 

Semiconductor Sector Charges the Earnings Confessional

It was a busy week in the proverbial earnings confession booth. One sector seeing plenty of air time was the semiconductor space, and a chip stock that came away with a favorable post-earnings reaction was Qalcomm (QCOM). The company's fiscal second-quarter earnings and revenue beat gave the equity a major boost, and attracted a few bull notes. Analysts were quick to chime in on an earnings beat from Advanced Micro Devices (AMD), too. The security raked in at least seven price-target hikes, though Summit Insights Group did wind up downgrading the stock to a "hold." Skyworks Solutions (SWKS) wasn't as lucky as its sector peers. The equity has taken quite the drubbing during today's trading, even with an earnings beat and several bull notes under its belt, likely due to a disappointing forecast

Big Tech and Earnings Season: the Good, the Bad, and the Ugly 

Tech stocks ruled the week this week, with Wall Street wading through major updates and earnings reports from social media bigwigs and e-commerce titans alike. Apple (AAPL), of course, was on the radar, attracting plenty of attention from option traders and analysts after its upbeat earnings report and positive buyback news drove the stock higher during yesterday's trading. Earlier in the week, however, the equity was flatlining as investors pored over the company's latest economic investment plans

Amazon (AMZN) also made a splash after its earnings report, though its quarterly beat wasn't enough to lift stock futures on Friday morning. Meanwhile, two social media giants, Facebook (FB) and Twitter (TWTR), announced their first-quarter results, eliciting very different reactions from traders. In fact, the former grabbed a fresh record high, following its announcement, while the latter gapped dramatically lower, deflated by concerns over slowing user growth

Earnings Season to Reach a Fever Pitch During First Week of May

The first week of May will drop investors right into the height of earnings season, with reports from the likes of Chegg (CHGG), Etsy (ETSY), Cloudflare (NET), Fastly (FSLY), Lyft (LYFT) and Pfizer (PFE) all on tap. Traders will also be paying special attention to trade deficit data, a fresh ADP employment report, the Markit manufacturing and services purchasing managers' indexes (PMI), jobless claims, and nonfarm payrolls.

In the meantime, traders can check out the latest Monday Morning Outlook, in which Schaeffer's Senior V.P. of Research Todd Salamone parses over some of the key storylines that moves markets in late April. Plus, Schaeffer's Senior Quantitative Analyst Rocky White looks put an old investor trope under a microscope to see if there's any truth in the catchphrase. 

Bernie's Best Stock Bets for Summer 2021

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