Wall Street ended the week on a positive note with a resumption of rotation in Value stocks We have been discussing for the past few days.
On Friday, several major indices ended the record territory, including the Dow Jones industry average, which rose steadily for most of the day, increasing 1.4% to 29,479.
Boeing (BA) returned to its early weekly form with a robust improvement of 5.9%. But it was Cisco Systems (CSCO(+ 7.1%), who led the 30 components of the Dow after reporting better-than-expected sales and profits, while raising hopes that the four-quarters of the sales declines might soon end.
“Some investors have raised concerns that Cisco could become IBM a few years ago when that company masked a multi-year stream of quarterly revenue declines with share buybacks that artificially boosted EPS,” said Jim Kelleher, an analyst at Argus Research, who repeated it Buy rating on CSCO. “While IBM has been overtaken in new markets such as cloud, social and mobile, Cisco does not appear to be losing any stake. Instead, its challenges stem primarily from pandemic demand.”
“Cisco also maintains high pre-tax margins and continues to generate strong free cash flows. The company is successfully shifting its mix from hardware to an integrated software, hardware and service solution.”
Cisco’s report was hardly unusual, however: S&P 500 components knocked down profit targets left and right. “84% of the S&P 500 companies reported a positive EPS surprise for the third quarter,” said FactSet’s John Butters. “If 84% is the final percentage, it will be the mark for the highest percentage of S&P 500 companies reporting positive EPS surprises since FactSet started tracking that metric in 2008.”
Outside of Cisco, the technology continued to underperform, especially when gaming from home. Zoom video (ZM(-5.9%), for example, just ended up with a miserable week with the videoconferencing provider losing 19% under the vaccine’s optimism.
Other actions on the stock market today:
The little cap Russell 2000 (+ 2.1% to 1,744) is back at a record level for the first time since August 2018.
The S&P 500 closed 1.4% on a record of 3,585.
The Nasdaq Composite increased by 1.0% to 11,829.
gold December futures contracts rose 0.7% to $ 1,886.20 an ounce.
US. crude oil Futures declined 2.4% to $ 40.13 a barrel but ended the week 8.1%.
Growth will be fine
Do you want to give your 401 (k) a boost in energy in 2021 and beyond? Don’t sleep on growth investments – yes, many analysts have called for a rotation in value, but many of those analysts expect the leadership change to be temporary.
As part of our ongoing analysis of the 100 most popular 401 (k) funds – including fund selection for pension savers vanguard and loyalty – We now take a look at T. Rowe Price funds, most commonly found in 401 (k) plans. Founder Thomas Rowe Price is viewed by many as the father of growth investing. So don’t be surprised to learn that many of the company’s dazzling funds focus on fast-growing stocks.
Here we investigate A dozen T. Rowe Price products you might find on your 401 (k) planand assign each of them a buy, hold or sell rating.
Kyle Woodley was long BA at the time of this writing.