Solid Earnings Season And Productive U.S.-China Trade Talks Support Stocks

The major indexes closed modestly higher yesterday to kick off this shortened trading week.

Stocks have put in an impressive performance this earnings season after another quarter of double-digit earnings growth. While it's not over yet, it is winding down with over 80% of the S&P 500 members already reporting.

The market has also been cheering the U.S-China trade talks as optimism grows that a deal will finally get done.

Last week in Beijing, a U.S. trade delegation led by Treasury Secretary Steve Mnuchin, and U.S. Trade Representative Robert Lighthizer, was joined by China's President Xi for high level talks. And this week, a Chinese delegation arrived in Washington for more talks. Deputy meetings are being held in the first part of the week, with high level talks occurring on Thursday and Friday.

So far, all of the recent meetings have been characterized as productive. And both sides hope to emerge from the meetings this week with a memorandum of understanding.

The deadline for a deal is March 1st. But President Trump has already said that he'd be willing to extend the deadline for raising tariffs "if we're close to a deal."

He also mentioned that he expects to meet with President Xi soon. This has people even more optimistic since the two leaders would likely only be meeting if they expected to emerge victorious with a trade agreement. While there's no date and time for this meeting yet, assuming it even happens, the simple fact that the White House has floated this out there, suggests things are going very well.

As I've said before, traders will be listening for any news on how the continued trade talks are going this week.

More good news should mean more gains for stocks.

See you tomorrow,

Kevin Matras

Executive Vice President, Zacks Investment Research

Sponsor

The Top 10 Stocks To Buy For 2019

Investing legend Louis Navellier is one of America's top Money Managers, with over $1 billion under management... He's gained worldwide attention for uncovering some of America's biggest investment opportunities before the masses... He found Apple at $4... Oracle at $6... Amazon at $40... He just released his most anticipated report of the year: The Top 10 Stocks to Buy For 2019.

Claim your free copy now.

5 Stocks in Limelight Due to Recent Broker Rating Upgrades

Given their knowledge and know how in the field of investing, it is a good strategy to be guided by broker advice. Read More »

4 Marijuana Stocks to Watch in 2019

Companies in this up-and-coming industry have taken aggressive steps to raise cash, go public and list their shares on the U.S. exchanges to access capital. Read More »

3 Tech Stocks Under $10 to Buy Now

We highlight tech stocks currently trading for less than $10 a share and holding a Zacks Rank #1 (Strong Buy) or #2 (Buy). Read More »

Real Estate Operations Stocks' Near-Term Outlook Looks Upbeat

While the industry will gain from solid demand for leasing, outsourcing of real estate needs and technology investments, the cautious approach by investors may hurt trading volume. Read More »

Can Apple's Services Counteract Flagging iPhone Sales?

The software giant witnessed continuing momentum in services which helps to negate the impact of falling iPhone sales. Read More »

Sponsor

Radical Technology Creates $12.3 Trillion Opportunity

Imagine buying Microsoft stock in the early days of personal computers. Or Motorola after it released the world's first cell phone. These technologies changed our lives and created massive profits for investors.

Today, we're on the brink of the next quantum leap in technology. 7 innovative companies are leading this "4th Industrial Revolution." Early investors can still get in ahead the surge – and the potential profits are staggering.

See the 7 breakthrough stocks now>>

Bull of the Day: Telenav (TNAV)

A solid earnings history and higher earnings estimates help boost this stock to the top Zacks Rank. Read More »

New Zacks Strong Buys for February 20th

Here are 5 stocks added to the Zacks Rank #1 (Strong Buy) List today. Read More »