Note: Our daily “S&P 500 Outlook, Forecast, and Trading plan for Friday, 04/26” will be posted around 8:30am EDT, Friday.
THE GIST (“THE WHAT”)
The S&P 500 struggled to break above the all-time highs, closing mostly flat at 2926.17, down only 1.08 points over previous session’s close. Today’s choppy price action was primarily driven by earnings hits and misses by key companies across sectors.
Trading lower for early morning session, the index reversed losses alongside a spike in Facebook Inc. and Microsoft Corp. Weakness in Industrials and Materials, however, overshadowed strength in Communication Services and Health Care stocks, nudging the broader index lower to close mostly flat for the session.
THE DETAILS (The “How & Why”):
Facebook Inc. soared 5.85%, lifting the Communication Services sector after the social-media giant delivered impressive quarterly performance. Investors ignored a huge $3 billion charge to cover an expected fine from the Federal Trade Commission, instead focusing on a better-than-expected 26% increase in revenue during the first quarter.
Microsoft Corp. hit a $1 trillion valuation, jumping 3.31% on beating revenue and earnings estimates. Cincinnati Financial Corp., Lam Research Corp., Hershey Co., and Valero Energy Corp were some of the other strong gainers on the back of better-than-expected quarterly performance.
Meanwhile, Xilinx Inc., 3M Co and Freeport-McMoRan Inc. plunged 17.08%, 12.95% and 10.09% on posting weaker-than-expected earnings, weighing down heavily on Industrials and Materials sectors. United Parcel Service Inc., Rockwell Automation Corp. and Altria Group were the other major decliners on the back on earnings misses.