U.S. Equity Market Radar (February 6, 2012)
The domestic stock market as measured by the S&P 500 Index rose by more than 2 percent for the week. The financial and technology sectors led the way, with both rising by more than 3 percent.
Strengths
- The S&P 500 Financials had a very strong week, rising by more than 4 percent as this sector continues to respond to positive economic and government policy developments.
- The S&P 500 Technology sector also had a strong week, led by strong results from Mastercard, a bounce back from the prior week for Corning and rising expectations for NetApp in front of earnings.
- Individual stocks that performed well this week include Whirlpool Corp., Marathon Petroleum, and Genworth Financial, all three stocks rose by at least 16 percent this week.
Weaknesses
- Defensive, noncyclical sectors underperformed as utilities, consumer staples and healthcare all lagged the market this week.
- The consumer & electronics retail industry group was among the worst performers as both Best Buy and GameStop fell for the week as Radio Shack reported disappointing preliminary results.
- Abercrombie & Fitch Co. was the worst performer in the S&P 500 after giving weak preliminary results and 2012 guidance.
Opportunities
- Earning results have been encouraging so far and the market has responded. We have another heavy week of earnings announcements next week.
Threats
- An escalation in concerns over sovereign debt obligations in Europe would be negative for stocks.
