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Benchmarks finished in the green on Monday, following the victory of centrist candidate Emmanuel Macron in the first round of the French presidential election. The surge in shares of JPMorgan Chase and Goldman Sachs boosted the Dow. Meanwhile, investors kept a close watch on quarterly earnings results with Alphabet GOOGL and Microsoft MSFT scheduled to report their earning results this week.
For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.
The Dow Jones Industrial Average (DJI) advanced 1.1% to close at 20,763.89. The S&P 500 rose 1.1% to close at 2,374.15. The tech-laden Nasdaq Composite Index gained 1.2% to a record close at 5,983.82, after hitting an all-time high on an intraday. The fear-gauge CBOE Volatility Index (VIX) declined 26.0% to 10.82, marking its biggest one day percentage drop since August, 2011. A total of around 3.7 billion shares were traded in NYSE on Monday. Advancers outpaced declining stocks on the NYSE. For 68% stocks that advanced, 29% declined.
First Round Presidential Election Outcome
After a close contest, centrist candidate Emmanuel Macron and far-right candidate Marine Le Pen emerged as top contenders for the final round of the presidential election in France scheduled to be held on May 7. The outcome of the final round of the contest between Marine Le Pen and Macron will ultimately have a major bearing on the future of the European Union. In the first round of the French presidential election on Sunday, Macron was ahead with 23.9% of the vote, compared to his closest competitor, euro skeptic candidate Marine Le Pen, who secured 21.4% of the vote.
Meanwhile, a poll released by Ipsos/Sopra Steria on Sunday indicated Macron was leading Le Pen, 62% to 38%. Moreover, socialist Benoît Hamon and conservative François Fillon later decided to support Macron. Earlier, Marine Le Pen had called for exiting the Euro, leading to fears of a possible “Frexit”. A Frexit will cause significant geopolitical instability in the Euro zone as France is an essential of both the Eurozone and the European Union. Macron’s lead helped to reduce the prospect of such an outcome.
Macron’s victory in the first round not only contributed to gains for European equities but also lifted investor confidence in the U.S. which ultimately had a positive impact on the broader markets.
Dow Boosted by J.P. Morgan Chase and Goldman Sachs
Shares of JPMorgan Chase & Co. JPM and Goldman Sachs GS surged 3.5% and 2.9% respectively which boosted the Dow. Nine of the S&P 500’s eleven sectors traded higher, led by a 2.3% increase in the broader Financial Select Sector SPDR (XLF), marking its biggest one day hike since March. Some of the key holdings of the financial sector in the S&P 500 including Bank of America Corp BAC and Wells Fargo & Co WFC gained by 4.1% and 1.2% respectively. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Meanwhile, investors remained focused on the expected U.S. tax-reform package to be announced by Trump this week and on first quarter earnings results.
Stocks that made Headlines
Whirlpool Down on Q1 Earnings Miss, Outlook Trimmed
Whirlpool Corporation WHR posted first-quarter 2017 results, wherein earnings lagged estimates for the third consecutive quarter and dipped year over year. (Read More)
Crown Castle Beats on Earnings and Revenues in Q1
Crown Castle International Corp. CCI, a leading wireless communication tower operator, reported impressive financial results for the first quarter of 2017. (Read More)
T-Mobile US Tops Q1 Earnings & Revenue Estimates
T-Mobile US Inc. TMUS reported strong financial results in the first quarter of 2017 wherein both the top line and bottom line outpaced the Zacks Consensus Estimate. (Read More)
Canadian National Beats on Q1 Earnings & Revenues
Canadian National Railway Company’s CNI first-quarter 2017 earnings (on an adjusted basis) of 88 cents per share (or C$1.15) beat the Zacks Consensus Estimate of 84 cents. (Read More)
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.