Record Closes for NASDAQ, S&P to Begin Big Tech Week

The NASDAQ registered its first closing high in more than two months on Monday, as the market gets ready for an important week that will see four of the five FAANGs and other major tech names report their quarterly results.

The tech-heavy index blew the doors off its counterparts with a rise of 0.87% (or nearly 122 points) to 14,138.78. This marks its first closing high since February 12 and its first close above 14,100. All of the FAANGs were higher.

The S&P also reached a new record, though this index has accomplished that feat several times over the past two months. It only needed to advance 0.18% to make history at 4187.62. The Dow was left out of the fun by sliding 0.18% (or nearly 62 points) to 33,981.57.

Stocks are returning from a slightly negative week, which broke winning streaks for all the major indices. The main problem came last Thursday on news reports that President Biden was thinking about doubling the capital gains tax on people making $1 million or more. However, a rally on Friday significantly narrowed the losses.

The crazy week of earnings got started after the bell today when EV pioneer Tesla (NASDAQ:TSLA) reported first quarter results that easily beat expectations. As you might expect, the stock is down approximately 1.7% afterhours, as of this writing.

Earnings results have been great so far this season, but the response is often negative as the market is looking for perfection. So it’s going to be really interesting to see how investors respond to what one of the editors has called “the most anticipated week of the Q1 earnings season”.

The big FAANG report tomorrow comes from Alphabet (NASDAQ:GOOGL) (GOOG), but we’ll also be watching Microsoft (NASDAQ:MSFT). And then on Wednesday we’ve got Apple (NASDAQ:AAPL) and Facebook (NASDAQ:FB), while Thursday brings Amazon (NASDAQ:AMZN).

This week also includes a FOMC meeting and hundreds of other earnings reports that might be overshadowed by the big tech deluge. Some of tomorrow’s other reports include Visa (NYSE:V), Eli Lilly (NYSE:LLY), Texas Instruments (NASDAQ:TXN), UPS (UPS) and Starbucks (NASDAQ:SBUX).

Today's Portfolio Highlights:

Surprise Trader: For more than three years now, Perficient (NASDAQ:PRFT) has been beating the Zacks Consensus Estimate. That’s 14 straight positive surprises stretching back to late 2017! Dave thinks that streak will continue when PRFT reports again before the bell on Thursday. This Zacks Rank #2 (Buy) digital transformation consulting firm has a positive Earnings ESP for the upcoming report. The editor added PRFT on Monday with a 12.5% allocation, while also selling SnapOn (SNA) for a breakeven result in one week. Read the full write-up for more on today’s action.

Counterstrike: By now you’ve noticed that a strong quarterly report this earnings season does NOT mean a stock is going to move higher. Therefore, Jeremy sold a couple positions on Monday to secure profits before their unpredictable reports, while also raising cash for potential counterstrike opportunities as stocks needlessly sell off. Enphase Energy (NASDAQ:ENPH) is a volatile solar stock that reports tomorrow night, so the editor sold it today for a nice 25% return in less than two months. And it doesn’t look like Qorvo (NASDAQ:QRVO) will break $200 before earnings next week, so the RF solutions company was sold for more than 19% in less than three months. Meanwhile, online pet retailer Chewy (NYSE:CHWY) looks secure above its 200-day, so Jeremy added 4% more to the position. It was originally purchased on April 7. Read the full write-up for more on today’s moves.

Technology Innovators: It’s not all about growth for this portfolio. Brian also wants to add stocks with a high degree of stability. Upland Software (NASDAQ:UPLD) offers both of these attributes. This Zacks Rank #2 (Buy) enterprise software name has beaten the Zacks Consensus Estimate in the past four quarters with an average surprise of 30.4%. The editor likes its valuation when compared to industry averages, along with its topline growth of 18% in the most recent quarter and 31% last year. The addition of UPLD fills one of two open spots in the service, so get ready for another buy in the days ahead. Learn more about this addition in the full write-up. In other news, this portfolio had a top performer today as Clearfield (NASDAQ:CLFD) rose 9%.

Commodity Innovators: The portfolio needed more exposure to specialty and precious metals, so Jeremy added Sibayne Gold (SBSW) on Monday. Despite its name, this Zacks Rank #1 (Strong Buy) is much more than a gold company. It also has operations in platinum, rhodium and palladium. The editor really appreciates its entry into the lithium market in Finland, which gives them a piece of the burgeoning battery metal space. SBSW offers a 7% dividend payout and has slowly drifted higher by about 15% over the past year. Jeremy thinks it will continue and sees this stock as a long-term holding. Read the complete commentary for more.

Healthcare Innovators: One of the main reasons why Kevin added Axsome Therapeutics (NASDAQ:AXSM) last week was the likely approval of its AXS-05 treatment for depression. Well, the company took a big step toward that goal when the FDA accepted its New Drug Application for AXS-05, which could be a potential blockbuster moving forward. As a result, AXSM was the best performer of the day among all ZU names by jumping 11%. By the way, this portfolio had three of the top performers of the session as Intellia Therapeutics (NASDAQ:NTLA, +8.3%) and uniQure (NASDAQ:QURE, +8.3%) also made the list.

Black Box Trader: The portfolio replaced four names in this week's adjustment. The positions that were sold today included:

• Jefferies (NYSE:JEF) Financial Group (JEF, +7.7%)
• Olin Corp. (NYSE:OLN, +5%)
• Marathon Petroleum (NYSE:MPC)
• Dow, Inc. (DOW)

The new additions that filled these spots were:

• Deutsche Bank (DE:DBKGn) (DB)
• Domtar Corp. (NYSE:UFS)
• Tenet Healthcare (NYSE:THC)
• U.S. Steel (X)

Read the Black Box Trader’s Guide to learn more about this computer-driven service.

Headline Trader: "Today kicks off the biggest week of this highly anticipated Q1 earnings season, and I am ready to pull the buy trigger on some well-positioned stocks that experience profit pulls on solid results. Any report less than exceptional could catalyze a share price pull back for stocks across the board." -- Dan Laboe

Until Tomorrow,
Jim Giaquinto

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