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With the first quarter of 2021 in the bag, I wanted to start this April report with YTD returns.
1. U.S. Markets
First up, here are U.S. benchmark returns of note.
One key U.S. point: Value handily beat Growth. Consistent with that broad index returns fact, Energy (+30.3%) and Financials (+16.4%) led U.S. sector SPDRs.
In that sense, the last 3 months of time witnessed a long-called-for rotation.
Will it continue?
2. Global Markets
Second, here are global benchmark returns of note.
After Q1, the S&P 500 made a +5.6% return. The Vanguard “world outside the U.S.” ETF (VEU - Free Report) made a +4.0 return. Regional variation looked wide, partly driven by COVID vaccination and caseload differences.
That is resetting expected regional revenue growth rates, often lower.
The Middle East-Saudi Arabia (KSA), via Oil, was the big winner. At +11.5%.
Europe’s STOXX 50 (FEZ) offered a +6.7% return, beating the S&P500.
Mainland China A-shares (FXI) came in with a near zero return. At +0.4%.
Brazil (EWG) and Latin America (ILF) were laggards. At -11.5% and -6.9%.
But global COVID vaccination rates are going up, now.
3. Zacks April Sector/Industry/Company Telescope
The Zacks Rank system showed 4 strong sectors, again, which is durably bullish.
Info Tech was a top sector again; strong across all industries. Three cyclical sectors – Consumer Discretionary, Energy, and Industrials – came in at the top. Think Consumer Electronics, Home Furnishings, and Autos/Tires/Trucks, and further back, Machinery-Electrical, Construction-Building Services, and Metal Fabricating.
Financials was the 4th great sector, with Investment Banking & Brokering, Banks & Thrifts, and Major Banks strong. Wider yield spreads and higher saving rates help.
Materials slipped a bit, but remained Attractive.
Telcos and Utilities were at Market Weight again. Health Care fell a tad to Unattractive. Medical Products led again this month. Consumer Staples was the sole Very Unattractive sector this month.
(1) Info Tech stayed Very Attractive. Misc. Tech, Computer-Office Equipment, Telco Equipment, and Electronics, all of those look excellent.
(2) Industrials stayed Very Attractive. Machinery-Electrical, Construction-Building Services, Metal Fabricating, Pollution Control, and Machinery the top industries again.
(3) Financials stayed Very Attractive. Investment Banking, Banks & Thrifts and the Major Banks looked good. Higher rate spreads and savings help all of these.
(4) Energy rose to Very Attractive from Market Weight. Oil & Gas Integrated looked best.
(5) Materials drifted down to Attractive from Very Attractive. Steel, Metals-non-Ferrous, and Building Products, remained very strong.
(6) Consumer Discretionary rose to Attractive from Market Weight. Consumer Electronics, Home Furnishing, and Autos/Tires/Truck, were strong, and showed the stimulus check buyer and saver is now in play.
(7) Communications Services stayed Market Weight. Telco Equipment the best area.
(8) Utilities stayed at Market Weight.
(9) Health Care went down a tad to Unattractive from Market Weight. Medical Products still looked the best.
(10) Consumer Staples fell to Very Unattractive from Market Weight. Agribusiness looked the best. It was a strong outlier, to the positive side, again.
That’s if for me. Enjoy the full report.
Warm Regards,
John Blank
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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What Can We Learn from Q1? Zacks April Market Strategy
The following is an excerpt from Zacks Chief Strategist John Blank’s full Apr Market Strategy report To access the full PDF, click here.
With the first quarter of 2021 in the bag, I wanted to start this April report with YTD returns.
1. U.S. Markets
First up, here are U.S. benchmark returns of note.
One key U.S. point: Value handily beat Growth. Consistent with that broad index returns fact, Energy (+30.3%) and Financials (+16.4%) led U.S. sector SPDRs.
In that sense, the last 3 months of time witnessed a long-called-for rotation.
Will it continue?
2. Global Markets
Second, here are global benchmark returns of note.
After Q1, the S&P 500 made a +5.6% return. The Vanguard “world outside the U.S.” ETF (VEU - Free Report) made a +4.0 return.
Regional variation looked wide, partly driven by COVID vaccination and caseload differences.
That is resetting expected regional revenue growth rates, often lower.
But global COVID vaccination rates are going up, now.
3. Zacks April Sector/Industry/Company Telescope
The Zacks Rank system showed 4 strong sectors, again, which is durably bullish.
Info Tech was a top sector again; strong across all industries. Three cyclical sectors – Consumer Discretionary, Energy, and Industrials – came in at the top. Think Consumer Electronics, Home Furnishings, and Autos/Tires/Trucks, and further back, Machinery-Electrical, Construction-Building Services, and Metal Fabricating.
Financials was the 4th great sector, with Investment Banking & Brokering, Banks & Thrifts, and Major Banks strong. Wider yield spreads and higher saving rates help.
Materials slipped a bit, but remained Attractive.
Telcos and Utilities were at Market Weight again. Health Care fell a tad to Unattractive. Medical Products led again this month. Consumer Staples was the sole Very Unattractive sector this month.
(1) Info Tech stayed Very Attractive. Misc. Tech, Computer-Office Equipment, Telco Equipment, and Electronics, all of those look excellent.
Zacks #1 Rank (STRONG BUY) Stock: Micron (MU - Free Report)
(2) Industrials stayed Very Attractive. Machinery-Electrical, Construction-Building Services, Metal Fabricating, Pollution Control, and Machinery the top industries again.
Zacks #1 Rank (STRONG BUY) Stock: Lennar (LEN - Free Report)
(3) Financials stayed Very Attractive. Investment Banking, Banks & Thrifts and the Major Banks looked good. Higher rate spreads and savings help all of these.
Zacks #1 Rank (STRONG BUY) Stock: Jeffries (JEF - Free Report)
(4) Energy rose to Very Attractive from Market Weight. Oil & Gas Integrated looked best.
(5) Materials drifted down to Attractive from Very Attractive. Steel, Metals-non-Ferrous, and Building Products, remained very strong.
(6) Consumer Discretionary rose to Attractive from Market Weight. Consumer Electronics, Home Furnishing, and Autos/Tires/Truck, were strong, and showed the stimulus check buyer and saver is now in play.
(7) Communications Services stayed Market Weight. Telco Equipment the best area.
(8) Utilities stayed at Market Weight.
(9) Health Care went down a tad to Unattractive from Market Weight. Medical Products still looked the best.
(10) Consumer Staples fell to Very Unattractive from Market Weight. Agribusiness looked the best. It was a strong outlier, to the positive side, again.
That’s if for me. Enjoy the full report.
Warm Regards,
John Blank
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
AccessZacks Top 10 Stocks for 2021 today >>