US Stocks Ended June 2, 2017

Bob Carey
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US Stocks Ended June 2, 2017

Posted Under: Weekly Market Commentary

Equity markets roared to an all-time high last week, as the S&P 500 gained over 1% with materials and health care sectors leading the way. Much of the rally came on Thursday after ADP Employment numbers were released 40% higher than expectations. Strong job growth continued to fuel markets on Friday when the unemployment rate fell to 4.3%, the lowest level since 2001. Energy was the poorest performing sector as crude fell from $49.90 down to $47.78. Energy exploration and production company Southwestern Energy Company was the worst performing stock in the S&P 500 last week. Their shares fell over 13% as natural gas continued to fall and their production has shrunk over 14% from last year. The top performing name in the S&P 500 was Dollar General Corp. Shares of the discount retailer flew up over 9% last week after they announced revenues and earnings higher than analyst estimates. They also announced strong revenue guidance for the rest of the year and better than expected financials behind an asset purchase from Sycamore Partners, a private equity firm. Broadcom Ltd, the semiconductor giant, released their earnings and revenue numbers well ahead of analyst estimates and the stock rallied over 8% as a result. They continue to execute well as market demand for their phone and network content remains strong. Amazon.com Inc. hit a milestone as their shares closed over $1000 per share for the first time in their history. Despite all-time highs in the equity markets, long-term equity returns tend to be fueled by corporate earnings. Bloomberg estimates ~19% earnings per share growth for the S&P 500 over the next 12 months. We remain constructive on U.S. equity markets fueled by corporate profit growth, economic strength and improving business conditions.

Posted on Monday, June 5, 2017 @ 7:49 AM • Post Link	Share:
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

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