Nasdaq Caps Big Weekly Gain, S&P 500 Passes Key Test

TL;DR

The Nasdaq capped a strong week while the S&P 500 passed a key technical test by retaking its 50-day line. The S&P 500 gained 2.7%, the Dow rose 3%, and the Nasdaq advanced 1.4% after strengthening into the close. Gilead Sciences’ experimental coronavirus treatment lifted sentiment, while Incyte, Veeva Systems, and Netflix presented notable stock setups. Read on for the specific market signals behind each move.

Transcript

good afternoon everyone and happy Friday it's Alisa chorim and ken Shrieve here with a look at the stock market today and on today's show we're going to be taking a look at the charts of insight vive and Netflix with earnings around the corner but first let's take a look at the major indexes and to do that we're actually gonna take a look at spy th... Read More

Key Insights

• 💪 The stock market had a strong week, with the S&P 500 and Dow closing higher, indicating a positive market sentiment.
• 📰 Positive news on an experimental coronavirus treatment from Gilead Sciences boosted investor optimism.
• 😮 Insight, Veeva Systems, and Netflix are showing promising performance and are among the stocks to watch for potential earnings surprises.
• 🥺 The strength in the market has been broad-based, with growth stocks across various industries leading the charge.
• 🤩 The upcoming earnings reports of Insight, Veeva Systems, Netflix, and Domino's will be key factors to watch in determining market trends.
• 🥺 The IBD 50 index of leading growth stocks also had a good week, further indicating the positive market performance.

Questions & Answers

Q: How did the Nasdaq cap a strong week, and what key test did the S&P 500 pass?

The Nasdaq gained 1.4% after lagging for much of the session and then powering higher into the close. The S&P 500 rose 2.7% and retook its 50-day line, while the Dow finished up 3%.

Q: What drove the major stock indexes higher?

Market sentiment improved after news that an experimental coronavirus treatment from Gilead Sciences was showing strong efficacy in seriously ill patients at a Chicago-area hospital. Futures rose after Thursday’s close, and the Dow and S&P 500 opened sharply higher.

Q: Why did the Nasdaq lag before closing higher?

Technology stocks trailed for much of the session, and the Nasdaq was almost back to flat roughly an hour before the close. It then strengthened sharply alongside the Dow and S&P 500, finishing with a 1.4% gain.

Q: Why was Incyte highlighted as a biotech stock to watch?

Incyte gained 4.5% and broke into new-high territory on its second consecutive heavy-volume advance. Its flagship blood-cancer drug, Jakafi, was being evaluated as a COVID-19 treatment, and the company was described as a profitable biotech with earnings and sales.

Q: What did Incyte’s chart indicate?

Incyte made a strong move from its lows and broke out without pulling back as it approached its prior high. The move was supported by two straight heavy-volume gains, with generally solid volume behind recent advancing sessions.

Q: Why was Veeva Systems’ breakout considered bullish?

Veeva Systems was breaking out of a long consolidation and reaching new highs while its relative strength line also moved into new-high territory. The discussion characterized that combination as a healthy and bullish technical picture during a confirmed market uptrend.

Q: What does Veeva Systems do?

Veeva Systems makes cloud-based software for the life-sciences industry. Its software helps companies bring drugs to market faster, and it was described as a fundamental powerhouse and a leader in the enterprise-software group.

Q: What were the expectations for Netflix’s upcoming earnings report?

Netflix was expected to report another quarter of very strong growth on Tuesday after the close, with analysts discussing the possibility of a blowout quarter. Although the stock fell about 3.7%, the pullback followed four straight above-average-volume gains and was viewed as possible profit-taking.

Summary & Key Takeaways

• The major indexes, including the S&P 500 and Dow, had a strong week, with gains of 2.7% and 3%, respectively.

• Positive news on an experimental coronavirus treatment from Gilead Sciences boosted market sentiment.

• Insight, Veeva Systems, and Netflix are stocks to watch, with Insight experiencing a breakout, Veeva Systems consolidating before reaching new highs, and Netflix showing strong gains ahead of its earnings report.