This past week was an interesting week with the major averages closing out a record year followed up by the potential for another war in the Middle East.
The major indexes ended the week mixed for the week ended 2020-01-03. The Dow Jones Industrial average ended the week at 28,635 a decline of 0.0%. The broader S&P 500 index ended the week at 3,235 a decline of 0.2%. The Nasdaq 100 ended the week at 8,794 an increase of 0.3%. The average change for the major averages was up 0.02%.
The major averages closed out 2019 all with very large gains. The Dow Jones Industrials closed out the year with a 22.3% increase, the broader S&P 500 closed the year with a gain of 28.9% and the Nasdaq Composite closed out the year with a 35.2% gain.
We've only just begun 2020 but we've already got some YTD figures to look at and monitor. 2020 has started with the Dow Jones up 0.3%, S&P 500 up 0.1% and the Nasdaq Composite down 2.0% all year-to-date.
Investment Style View
If you are a dividend investor, dividend stocks declined in the last week by 0.8%, with the iShares Dividend price declining from $105.55 to $104.67.
In the latest week, large cap stocks outpaced both small cap and mid cap stocks. Large cap stocks increased by 0.3% for the week while mid-cap and small cap stocks had 'rounding error' decreases for the week to start out the year.
In order for us to monitor the performance difference between growth and value stocks, we look at the different capitalization levels (large, mid and small cap). In the latest week, the growth stocks of all 3 capitalization groups outperformed the value stocks. Large-cap growth stocks outperformed large-cap value stocks -0.1% as compared to -0.5%. Mid-cap growth stocks outperformed mid-cap value stocks 0.2% as compared to -0.6%. Finally, Small-cap growth stocks outperformed small-cap value stocks -0.1% as compared to -0.6%.
The week closed out mixed with a lot of uncertainty regarding where the markets will go after a strong 2019 and of course the continued turmoil in the Mid-East. 4 of the 11 sectors started the year with weekly gains with 7 starting the year with declines.
The sectors that increased this week were the Industrials, which gained 1.16%, Energy, which gained 1.0% on the week and Information Technology and Real Estate, which increased by 0.6% and 0.2% respectively.
Several sectors declined by over 1% on the week with the Materials sector dropping 2.1%, Consumer Staples declining 1.43% and Healthcare declining 1.1% on the week.
There were only 2 earnings releases of note this week, they were:
- Lamb Weston Holdings. (LW) announced earnings after the market close on 2020-01-03. Earnings came in at $0.95 the analyst consensus was $0.85, a difference of $0.10 per share. Shares closed the prior day at $84.09 a share and closed the day at $93.56 an increase of 11.3%.
- Nio Inc. (NIO) announced earnings after the market close on 2019-12-31. Earnings came in at $-0.33 the analyst consensus was $-0.41, a difference of $0.08 per share. Shares closed the prior day at $3.72 a share and closed the day at $4.02 an increase of 8.1%.
In this new section we will be highlighting companies that trade on Nasdaq or on the NYSE with strong dividend yields during the week. If you are looking for income producing stocks that will provide a good return on your investment, here are some ideas:
- Vermilion Energy Inc (VET) paid a dividend of $0.17 on 2019-12-30. The stock closed at $16.13 giving an estimated yield of 12.9%
- Permian Basin Royalty Trust (PBT) paid a dividend of $0.04 on 2019-12-30. The stock closed at $3.95 giving an estimated yield of 11.8%.
- Cross Timbers Royalty Trust (CRT) paid a dividend of $0.08 on 2019-12-30. The stock closed at $8.46 giving an estimated yield of 11.9%.
- Mesa Royalty Trust (MTR) paid a dividend of $0.06 on 2019-12-30. The stock closed at $7.41 giving an estimated yield of 10.3%.
- Starwood Property Trust (STWD) paid a dividend of $0.48 on 2019-12-30. The stock closed at $24.81 giving an estimated yield of 7.7%.
The Week Ahead
Things will begin to amp up with reports on activity to close out 2019:
- Tuesday: the Institute for Supply Management releases its Non-Manufacturing Purchasing Managers Index for December
- Tuesday: the Commerce Department reports the US international trade balance in goods and services for November
- Wednesday: ADP releases its National Employment Report for December. Economists are forecasting an increase of 165K after a 67K increase in November.
- Thursday: the Labor Department reports on initial jobless claims for the week ended January 4th.
The major earnings announcements for this week are (well, there really aren't any):
- Monday: Cal-Maine Foods
- Wednesday: Bed, Bath & Beyond, Lennar, Walgreens Boots Alliance
- Thursday: Accuity Brands, KB Home
- Friday: Infosys
Authors Note: Please note, the writer owns no stocks discussed in this article.
About the Writer
This page was created and is maintained by Kurt Tietjen, Founder of Stavera, High Peak Media & HomeGearWorks.com. Kurt is an executive, data scientist and software engineer who holds an MBA in Management Information Systems. In 2010, he partnered with scientists at Northwestern University to launch The Street Wire. This was one of the first mainstream uses of what would become “Narrative Science”, an artificial intelligence platform specializing in natural language generation. You can contact Kurt on LinkedIn here.