This week was highlighted by lessened tensions in the middle east, the return to the post-holiday momentum and a jobs report that was a bit short of expectations. It was enough to push the Dow Jones average up above 29,000, albeit briefly and was enough to nearly erase the YTD decline in the Nasdaq composite.
All 3 major indexes were up for the week ended 2020-01-10. The Dow Jones Industrial average ended the week at 28,824 an increase of 0.7%. The broader S&P 500 index ended the week at 3,265 an increase of 0.9%. The Nasdaq 100 ended the week at 8,967 an increase of 2.0%. The average change for the major averages was up 1.19%.
Two of the three major averages are in positive territory in this second end-of-week update with the S&P500 up 1.1% in the first 10 days of the year, the Dow up 1.0% and the Nasdaq composite down 0.1% to start the year.
Investment Style View
If you are a dividend investor, dividend stocks increased in the last week by 0.3%, with the iShares Dividend price climbing from $104.67 to $104.97.
In the latest week, large cap stocks outpaced both small cap and mid cap stocks. Large cap stocks increased by 1.2% for the week while mid-cap stocks increased by 0.2% and small-cap stocks decreased by 0.5%.
In order for us to monitor the performance difference between growth and value stocks, we look at the different capitalization levels (large, mid and small cap). In the latest week, the growth stocks of all 3 capitalization groups outperformed the value stocks. Large-cap growth stocks outperformed large-cap value stocks 2.2% as compared to -0.4%. Mid-cap growth stocks outperformed mid-cap value stocks 2.3% as compared to 0.0%. Finally, Small-cap growth stocks outperformed small-cap value stocks 0.7% as compared to -0.6%.
The sectors were mixed this week with 7 sectors ending the week up and 4 ending the week down.
In a week of calming mid-east tensions, the Energy sector typically declines and this week was not different. The Energy sector declined 1.43% this week followed by the Materials sector, which declined 0.63% and the Industrials which declined by 0.26%.
Technology was the highlight of the week with The Information Technology sector increasing by 2.2% on the week and the Communication Services sector increased by 1.83%. Other strong performers this week were the Healthcare sector, which increased by 1.66% and the Utilities sector, which increased by 0.6%.
The week had a few earnings announcements ahead of next week where the Financial sector kicks up earnings season. This week's large companies reporting earnings were:
- Acuity Brands Inc. (AYI) announced earnings after the market close on 2020-01-09. Earnings came in at $2.13 the analyst consensus was $2.17, a difference of $-0.04 per share. Shares closed the prior day at $143.12 a share and closed the day at $123.42 a decline of -13.8%.
- Infosys Limited. (INFY) announced earnings after the market close on 2020-01-10. Earnings came in at $0.15 the analyst consensus was $0.14, a difference of $0.01 per share. Shares closed the prior day at $10.48 a share and closed the day at $10.65 an increase of 1.6%.
- Lennar Corporation. (LEN) announced earnings after the market close on 2020-01-08. Earnings came in at $2.13 the analyst consensus was $1.90, a difference of $0.23 per share. Shares closed the prior day at $57.14 a share and closed the day at $57.59 an increase of 0.8%.
- Walgreens Boots Alliance. (WBA) announced earnings after the market close on 2020-01-08. Earnings came in at $1.37 the analyst consensus was $1.40, a difference of $-0.03 per share. Shares closed the prior day at $59.29 a share and closed the day at $55.83 a decline of -5.8%.
After a few big weeks of year-end dividends, things have slowed down for these payments, but there's still a few big ones:
- Gap Inc (GPS) paid a dividend of $0.24 on 2020-01-07. The stock closed at $18.03 giving an estimated yield of 5.4%.
- AT&T Inc (T) paid a dividend of $0.52 on 2020-01-09. The stock closed at $38.8 giving an estimated yield of 5.4%.
- Patterson Companies (PDCO) paid a dividend of $0.26 on 2020-01-09. The stock closed at $21.67 giving an estimated yield of 4.8%
- Ethan Allen Interiors Inc (ETH) paid a dividend of $0.21 on 2020-01-08. The stock closed at $18.24 giving an estimated yield of 4.6%.
- General Mills (GIS) paid a dividend of $0.49 on 2020-01-09. The stock closed at $52.38 giving an estimated yield of 3.7%
The Week Ahead
Things will begin to amp up with reports on activity to close out 2019:
- Monday: Japanese markets are closed
- Tuesday: BLS releases the consumer price index for December with an expected reading of 2.3%, after Novembers' 2.1% reading.
- Wednesday: BLS releases the producer price index for December with an expected reading of 1.4%, after Novembers' 1.1% reading.
- Thursday: the Census Bureau reports on retail sales data for December with an expected 0.3% increase following Novembers' 0.2% increase.
- Friday: the BLS releases its Job Openings and Labor Turnover Survey for November. It's expected that there were 7.3 million openings on the last day of November.
Earnings season starts off this week, highlighted by some of the financial companies. Big announcements this week are:
- Tuesday: Citigroup, JPMorgan Chase, Wells Fargo, Delta Air Lines
- Wednesday: Bank of America, BlackRock, UnitedHealth Group, US Bancorp
- Thursday: Morgan Stanley, CSX, Bank of NY Mellon
- Friday: JB Hunt, State Street, Citizens Financial Group
Authors Note: Please note, the writer owns no stocks discussed in this article.
About the Writer
This page was created and is maintained by Kurt Tietjen, Founder of Stavera, High Peak Media & HomeGearWorks.com. Kurt is an executive, data scientist and software engineer who holds an MBA in Management Information Systems. In 2010, he partnered with scientists at Northwestern University to launch The Street Wire. This was one of the first mainstream uses of what would become “Narrative Science”, an artificial intelligence platform specializing in natural language generation. You can contact Kurt on LinkedIn here.