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The S&P 500 soared to new all-time highs on reassuring comments regarding potential interest rate declines. SPDR S&P 500 ETF Trust (SPY - Free Report) , the proxy version of the S&P 500 Index, has risen 8.3% so far this year.
We have highlighted five stocks that have gained in double digits so far this year. These are Nvidia Corporation (NVDA - Free Report) , Constellation Energy Corporation (CEG - Free Report) , Meta Platforms (META - Free Report) , Advanced Micro Devices (AMD - Free Report) and Eli Lilly and Company (LLY - Free Report) .
The Federal Reserve Chair Jerome Powell told a U.S. Senate committee that the central bank is “not far" from being confident that inflation is declining toward the 2% target, which would make rate cuts possible. The comment has bolstered investor expectations for the first rate cut in June.
Powell noted that inflation had “eased substantially” since hitting a 40-year high in 2022 but that policymakers still needed “greater confidence” in its continued decline before cutting rates. He added that there are risks of keeping monetary policy tight for too long and damaging an ongoing economic expansion that has sustained a below 4% unemployment rate for two years.
The latest bouts of weak data have also raised the bets that the Fed might lower interest rates as soon as June. The U.S. manufacturing sector recorded its 16th consecutive month of decline in February, while Michigan University’s consumer confidence index dropped slightly last month. U.S. personal spending data also showed the weakest reading in three years. Traders now see a 72.7% chance of the first rate cut this year in June, per CME Group's FedWatch tool (read: Is US Manufacturing Space Improving? 4 Sector ETFs Look Decent).
Further, the European Central Bank might also start cutting rates as soon as June on a softer outlook for inflation and economic growth.
Let’s take a closer look at the fundamentals of SPY.
SPY in Focus
SPDR S&P 500 ETF Trust holds 503 stocks in its basket, with each accounting for no more than 7% of the assets. This suggests a nice balance across each security and prevents heavy concentration. The fund is widely spread across sectors with information technology, financials, healthcare and consumer discretionary accounting for a double-digit allocation each.
SPDR S&P 500 ETF Trust has an AUM of $497.7 billion and charges 9 bps in fees per year. It trades in an average daily volume of 65 million shares and has a Zacks ETF Rank #3 (Hold) with a Medium-risk outlook (see: all the Large Cap Blend ETFs here).
Below, we have highlighted the abovementioned five best-performing stocks in the ETF.
Best-Performing Stocks of SPY
Nvidia is the worldwide leader in visual computing technologies and the inventor of graphic processing unit or GPU. The stock has jumped 87% so far this year. It has an estimated growth of 79.2% for the fiscal year ending January 2025.
Constellation Energy generates and markets electricity. It sells natural gas, renewable energy and other energy-related products and services. The stock has jumped 53.6% so far this year. It makes up 0.13% of the assets in the SPY portfolio.
Meta Platforms is the world’s largest social media platform. The company’s portfolio offering evolved from a single Facebook app to multiple apps like the photo and video sharing app Instagram and WhatsApp messaging app due to acquisitions. The stock has jumped 44.7% and has an estimated earnings growth of 34.1% for this year.
Meta Platforms accounts for 2.6% of SPY's assets. It currently has a Zacks Rank #1 and a Growth Score of B.
Advanced Micro Devices has strengthened its position in the semiconductor market. It has evolved from a pure-bred consumer-PC chip provider to an enterprise-focus company. The stock has rallied 43.4% so far this year and accounts for 0.79% of the SPY portfolio.
Advanced Micro Devices has an estimated earnings growth rate of 30.6% for this year and has a Zacks Rank #3.
Eli Lilly is one of the world’s largest pharmaceutical companies and boasts a diversified product profile, including a solid lineup of new successful drugs. The stock has gained 33.8% and accounts for a 1.4% share in the SPY portfolio.
Eli Lilly has an estimated earnings growth rate of 96.8% for this year and a Zacks Rank #3 at present.
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S&P 500 Soars to New Highs: 5 Best Stocks YTD
The S&P 500 soared to new all-time highs on reassuring comments regarding potential interest rate declines. SPDR S&P 500 ETF Trust (SPY - Free Report) , the proxy version of the S&P 500 Index, has risen 8.3% so far this year.
We have highlighted five stocks that have gained in double digits so far this year. These are Nvidia Corporation (NVDA - Free Report) , Constellation Energy Corporation (CEG - Free Report) , Meta Platforms (META - Free Report) , Advanced Micro Devices (AMD - Free Report) and Eli Lilly and Company (LLY - Free Report) .
The Federal Reserve Chair Jerome Powell told a U.S. Senate committee that the central bank is “not far" from being confident that inflation is declining toward the 2% target, which would make rate cuts possible. The comment has bolstered investor expectations for the first rate cut in June.
Powell noted that inflation had “eased substantially” since hitting a 40-year high in 2022 but that policymakers still needed “greater confidence” in its continued decline before cutting rates. He added that there are risks of keeping monetary policy tight for too long and damaging an ongoing economic expansion that has sustained a below 4% unemployment rate for two years.
The latest bouts of weak data have also raised the bets that the Fed might lower interest rates as soon as June. The U.S. manufacturing sector recorded its 16th consecutive month of decline in February, while Michigan University’s consumer confidence index dropped slightly last month. U.S. personal spending data also showed the weakest reading in three years. Traders now see a 72.7% chance of the first rate cut this year in June, per CME Group's FedWatch tool (read: Is US Manufacturing Space Improving? 4 Sector ETFs Look Decent).
Further, the European Central Bank might also start cutting rates as soon as June on a softer outlook for inflation and economic growth.
Let’s take a closer look at the fundamentals of SPY.
SPY in Focus
SPDR S&P 500 ETF Trust holds 503 stocks in its basket, with each accounting for no more than 7% of the assets. This suggests a nice balance across each security and prevents heavy concentration. The fund is widely spread across sectors with information technology, financials, healthcare and consumer discretionary accounting for a double-digit allocation each.
SPDR S&P 500 ETF Trust has an AUM of $497.7 billion and charges 9 bps in fees per year. It trades in an average daily volume of 65 million shares and has a Zacks ETF Rank #3 (Hold) with a Medium-risk outlook (see: all the Large Cap Blend ETFs here).
Below, we have highlighted the abovementioned five best-performing stocks in the ETF.
Best-Performing Stocks of SPY
Nvidia is the worldwide leader in visual computing technologies and the inventor of graphic processing unit or GPU. The stock has jumped 87% so far this year. It has an estimated growth of 79.2% for the fiscal year ending January 2025.
Nvidia makes up 5.1% of the assets in SPY and has a Zacks Rank #1 (Strong Buy) at present. It has a Growth Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
Constellation Energy generates and markets electricity. It sells natural gas, renewable energy and other energy-related products and services. The stock has jumped 53.6% so far this year. It makes up 0.13% of the assets in the SPY portfolio.
Constellation Energy has an expected earnings growth rate of 42.7% for this year and a Zacks Rank #3 (Hold). It has a Momentum Score of A (read: Nasdaq ETF Logs Best Month Since 2015: 5 Top Stocks).
Meta Platforms is the world’s largest social media platform. The company’s portfolio offering evolved from a single Facebook app to multiple apps like the photo and video sharing app Instagram and WhatsApp messaging app due to acquisitions. The stock has jumped 44.7% and has an estimated earnings growth of 34.1% for this year.
Meta Platforms accounts for 2.6% of SPY's assets. It currently has a Zacks Rank #1 and a Growth Score of B.
Advanced Micro Devices has strengthened its position in the semiconductor market. It has evolved from a pure-bred consumer-PC chip provider to an enterprise-focus company. The stock has rallied 43.4% so far this year and accounts for 0.79% of the SPY portfolio.
Advanced Micro Devices has an estimated earnings growth rate of 30.6% for this year and has a Zacks Rank #3.
Eli Lilly is one of the world’s largest pharmaceutical companies and boasts a diversified product profile, including a solid lineup of new successful drugs. The stock has gained 33.8% and accounts for a 1.4% share in the SPY portfolio.
Eli Lilly has an estimated earnings growth rate of 96.8% for this year and a Zacks Rank #3 at present.