A final-hour rally helped each of the major indices finish Thursday’s session on positive ground, despite another week of alarmingly high jobless claims.
But the NASDAQ really didn’t need any late-day heroics. The index continued to easily outperform its counterparts thanks to a number of tech giants that are prospering in this stay-at-home economy, including Amazon (NASDAQ:AMZN, +4.4%), NVIDIA (NASDAQ:NVDA, +4.9%), Microsoft (NASDAQ:MSFT, +3%), Netflix (NASDAQ:NFLX, +2.9%) and Roku (ROKU, +13.3%).
The NASDAQ jumped 1.66% (or about 139 points) today to 8532.36. It has now gained in five of the last six sessions.
The other indices were far behind on Thursday… but still on the plus side. The S&P is knocking on the door of 2800 after climbing 0.58% to 2799.55, while the Dow fought through an 8% plunge in Boeing (NYSE:BA) to inch higher by 0.14% (or about 33 points) to 23,537.68.
Thursdays are going to be all about jobless claims for the foreseeable future, especially if they continue to be as grim as the last four weeks. Over 5.2 million more claims were filed last week, bringing the total amount to more than 22 million since the coronavirus really took hold of this economy.
Unfortunately, that wasn’t the only bad news of the day, as we also saw rough reports on Philadelphia manufacturing and U.S. housing starts.
So it makes sense that talk of reopening the economy is getting louder and louder, especially since the spread of the coronavirus appears to be slowing.
The most booming voice of all, of course, is President Trump, who released federal guidelines after the bell today for getting parts of the country back to work.
Meanwhile, there are other parts of the country that will stay cautious, including New York. The ‘epicenter’ of the virus in this country extended its shutdown through the middle of May along with several other states.
The end result will likely be a staggered progression back to normalcy that could take a while in some areas. But at least we’re finally talking about recovery.
The NASDAQ and the S&P are heading into the final session with gains for the week, and the Dow isn’t too far from breakeven either. But you know how crazy Fridays have been lately, so let’s not jinx it by talking any further!
Today's Portfolio Highlights:
Stocks Under $10: For his second buy of the week, Brian picked up security software name Zix Corp. (ZIXI). This Zacks Rank #2 (Buy) is a leading provider of hosted email encryption and e-prescribing services. The company is trading at 11x forward earnings with ‘spectacular’ growth. How spectacular? In the most recent quarter, topline growth on an annual basis was 173%! Read the complete commentary for more this new buy. This addition brings the portfolio up to 11 names in the editor’s quest to get to 15 by the end of the month. So don’t be surprised if there are two additions again next week.
Surprise Trader: The trucking industry is as important as ever in this stay-at-home economy. Maybe even more so! With that in mind, Dave added Covenant Transport (CVTI) on Thursday. This truckload carrier has a noteworthy Earnings ESP of 10% for the quarter being reported later this month. The editor bought CVTI with a 12.5% allocation. He also sold Commercial Metals (CMC) for a nice 19.1% return in just about a month. Read the full write-up for more on today’s moves.
Technology Innovators: The portfolio added more exposure to the chip sector on Thursday by picking up ACM Research (ACMR), a Zacks Rank #2 (Buy) focused on single-wafer wet cleaning equipment. Semi manufacturers use this stuff to remove particles, contaminants and other random defects. The company has beaten the Zacks Consensus Estimate for four straight quarters with a robust average surprise of 135%. Brian was especially impressed with the good recovery that shares have already seen, as well as the 18% topline growth on an annual basis in its most recent report. He believes ACMR will work well for the portfolio in the coming months. Read the full write-up for a lot more on this new addition.
Until Tomorrow,
Jim Giaquinto
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