Stocks Knock it out of the Park in April, Led by Red-Hot Chips
Stocks knocked it out of the park in April.
Wall Street’s April rebound ended the month with a scoreboard that looks more like 2020 than 2026 — and some of the details look even more like the dot-com era.
The S&P 500 (^GSPC) surged over 10% during the month, its best showing since November 2020, while the Nasdaq Composite (^IXIC) jumped more than 15% for its best month since April 2020. The Nasdaq 100 (^NDX) gained nearly 16%, its best month since October 2002.
That was not the setup investors had in mind a month ago, with stocks still shaking off the shock of a major war and the bull market suddenly on defense.
The rally was broad enough to pull smaller stocks along too. The Russell 2000 (^RUT) climbed more than 12%, also its best month since November 2020.
But the S&P 500 equal-weight index rose less than 6%, barely more than half the gain in the cap-weighted S&P 500, and it now sits just under its March highs. That gap shows how much of April’s rally still came from the biggest stocks, not the average one.
Technology did most of the heavy lifting. The Technology Select Sector SPDR Fund (XLK) gained 20%, its best month since October 2002.
Chips were the biggest reason.
The PHLX Semiconductor Index (^SOX) surged more than 40% and had its best month since February 2000 — extending the record-setting semiconductor run that has been driving the AI trade. It logged a record 18-day win streak and rose 13 straight days to record highs.
That strength ran straight through the stock leaderboard.
Intel (INTC) posted its best month ever, adding to the breakout above its dot-com-era ceiling after earnings. AMD (AMD) had its best month since January 2001, while Micron (MU) and Texas Instruments (TXN) had their best months since February 2000.
The same concentration showed up in market value.
Alphabet (GOOG, GOOGL) added roughly $1.2 trillion in April — posting its best month since 2004 — while Amazon (AMZN) and Nvidia (NVDA) each added more than $600 billion. Broadcom (AVGO) tacked on more than $500 billion.
The laggards told the other side of the story.
Energy (XLE) and healthcare (XLV) finished lower in April, while the software comeback that briefly looked promising ended up fading against the semis. The iShares Expanded Tech-Software Sector ETF (IGV) rose less than 5% and is down more than 20% for the year.
April put bulls back in control. The test in May is whether the average stock can start carrying more of the load.
Seal Conlon and Lisa Kailai Han of CNBC also report S&P 500 closes at a new record to usher in May as oil prices cool and Apple rises:
The S&P 500 rose to a fresh all-time intraday high on Friday, boosted by Apple shares, while oil prices fell as a new month of trading got underway.
The broad market index advanced 0.29% to end at 7,230.12. The Nasdaq Composite added 0.89%, reaching an all-time high and closing at 25,114.44. Both indexes posted closing records. The Dow Jones Industrial Average slipped 152.87 points, or 0.31%, to settle at 49,499.27.
Shares of Apple climbed more than 3% after the consumer tech giant posted a fiscal second-quarter earnings and revenue beat. Not only that, the company’s revenue outlook for the current quarter was better than expected, overshadowing the fact that iPhone revenue fell short of estimates for the second time in three quarters.
On the flip side, oil prices fell after Iran reportedly sent its response through Pakistani mediators to the latest U.S. amendments to a draft agreement to end the Middle East conflict.
President Donald Trump revealed later Friday he is displeased with a new peace offer from Iran, saying that the country “wants to make a deal, but I’m not satisfied with it.”
Oil prices were off their lows of the day following that development. U.S. West Texas Intermediate crude futures fell 2.98% to settle at $101.94 a barrel. International benchmark Brent crude futures slid 2.02% to $108.17 a barrel.
The moves come after a record-setting session, with the S&P 500 closing above the 7,200 threshold for the first time ever. That helped both the S&P 500 and Nasdaq — which also notched a new record closing high — secure their strongest monthly performances since 2020. The Dow, meanwhile, saw its strongest monthly performance since November 2024.
A strong first-quarter earnings season, as well as hopes for easing tensions in the Middle East, have ultimately boosted stocks higher on the year. Although the major averages took a dip on the commencement of the U.S. war with Iran, all three indexes are now trading well above where they began 2026.
David Krakauer of Mercer Advisors believes that positive trajectory can continue in the long term for equities. While Krakauer is hopeful that the Iran war will conclude in the near term, leading to a reopening of the Strait of Hormuz, he believes that the earnings growth potential in the U.S. as well as overseas will offer momentum to stocks, even if the conflict persists.
“There could be always new news or some sentiment declining, where we could see a little bit of a pullback here after a strong pop up, but we’re still just overall strategically bullish on equities,” the vice president of portfolio management said.
Noting that there will be winners and losers in technology as “not all” of the artificial intelligence capital expenditures spending is going to “pay off,” Krakauer added, “We think the enhanced productivity story remains intact.”
Alright, it's finally Friday, Game 6 between the Montreal Canadiens and Tampa Bay Lighting starts in a little over 2 hours and I'm hoping the Habs win again tonight.
What can you say about the US stock market over the past month? Led by semiconductor stocks which were up 40%, it was outstanding month, an April to remember:
Notice how last year, during the Liberation Day tantrum, semis melted down to their 200-week exponential moving average, and then they bounce big -- and have never looked back.
You had a bit of a selloff when the Iran conflict hit in March, the SMH fell just below its 20-week exponential moving average (not shown above), and then "PAF!!", another melt-up to make a record new high.
Who's driving this price action? My bet is on CTAs and quant funds, whenever I see parabolic moves, I now they're adding massively to their positions.
Aren't semis overbought here? You bet they are but that doesn't mean they can't continue going higher.
You have to play the game but also be cognizant that stocks don't go up or down in a straight line, and when they're going parabolic, common sense risk management tells you to take some money off the table (an easy rule of thumb after a big move is to reduce your position after a negative weekly return).
This week we saw Big Tech earnings and while we can debate details, there's no debating Alphabet (Google) is the new AI king:
Again, this stock was a buy when it held above it 50-week exponential moving average in March and then ripped higher in April.
The violent upside moves I'm seeing in April in a bunch of stocks is quite incredible.
For example, last week I discussed Intel, but check out shares of Qualcomm (QCOM) and Twilio (TWLO), both up big this week:
Now, notice how Qualcomm's weekly MACD remains negative and the stock is unable to make a new 52-week high, whereas Twilio's weekly MACD is now positive and it made a new 52-week high today?
That tells me to stay long Twilio, buying any pullback there and avoid buying pullbacks in Qualcomm shares.
I can go on and on and on, I know Apple shares made a new 52-week high today and that's typically the (defensive) tech stock to buy when you feel the red-hot chips stocks are cruising for a bruising.
Below, the top-performing US large cap stocks over the past month (full list here):
Alright, that's a wrap, time to enjoy my weekend and Friday night hockey.
Below, the CNBC Investment Committee debate whether earnings can drive stocks higher and how you should position your portfolio.
Also, Fundstrat's Tom Lee joins 'Closing Bell' to discuss Lee's thoughts on equity markets, recent earnings growth and much more.
Lastly, some highlights from Game 5 where the Montreal Canadiens beat the Tampa Bay Lightning 3-2.
I'm psyched for Game 6. Go Habs Go!! Let's put this series behind us!!
Comments
Post a Comment