Stocks & Shares

8 out of 11 S&P 500 sectors printed significant gains in the last week

  • Healthcare sector gained the most (3%) in the S&P 500 index last week.
  • Energy sector lost 3% due to drop in oil prices and diminishing global demand.
  • Economic data and U.S - China trade optimism is likely to advance the upward rally further.
  • S&P 500 index has gained 12% in 2019 so far.

The S&P 500 index had another upbeat week ending on November 1st. Having opened at 3,032 on Monday, the index traded above the opening level for the most part and ended the week on a largely positive note around 3,067 level. The S&P 500 index printed a 1.5% gain in the past week and has climbed up 12% in 2019 so far.

Last Week Was Primarily Macro-Driven

The last week was primarily macro-driven with the United States Federal Reserve deciding in favor of cutting the rates further by 25 basis points for the third time this year, that fueled the upward rally in the stock indices. The Dow Jones Industrial Average noted a growth of 1.4% last week with Russell 2000 rising by 2%.

The move was further supported by other significant economic data including FED’s suggestion that the monetary policy will be paused for a while, the U.S employment report that presented positive outlook at large, and the ISM Manufacturing Index for October that wasn’t as bad as forecasted.

The earnings season continued last week with multiple S&P 500 listed businesses reporting their quarterly performances. By the end of the week, eight out of a total of 11 index’s sectors were noted to have posted gains while only three were lagging behind. The healthcare sector took the lead with around a 3% increase for the week. It was followed by information technology with a 2.1% gain. Industrial and financial sectors were among the other major gainers for the week with 2% and 1.5% improvement respectively.

Energy Sector Lost 3% Due To Drop In Oil Prices

Among the losers, real estate and utilities sectors were reported trading down by 0.7% and 0.1% respectively. The energy sector marked a 3% loss in the past week that was largely associated with the drop in oil prices and diminishing global demand.

Despite the continued contraction in the manufacturing sector for the third consecutive month, 128,000 nonfarm payrolls helped preventing it from keeping the stock indices under pressure. The largely positive earnings report by tech-giants like Facebook and Apple further contributed to the bull run in the S&P 500 index that printed an all-time high of 3,066.91 as of Friday.

On the U.S – China trade negotiations front, the United States Trade Representative, Robert Lighthizer, announced last week that tremendous progress has been made in resolving key issues and the Phase 1 deal is set to be signed by the end of November. The fading uncertainty on the trade front is likely to keep the S&P 500 index upbeat in the upcoming weeks.

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