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Monthly Market Wrap: April 2021

Welcome back to the Monthly Market Wrap from YCharts, where we break down the most important market trends for advisors and their clients every month. As always, feel free to download and share any visuals with clients and colleagues, or on social media.

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These really are crazy times, aren’t they?

As our CEO Sean Brown noted midway through April, if you had invested $10,000 in a cryptocurrency named after a dog and sold on April 14th, you could buy a Mercedes G-Class SUV…in cash.

A few weeks and one brief correction later, the price of Dogecoin has gone even higher. Anyone out there become a “Dogecoin millionaire”?

2021 YTD price growth of Dogecoin, Bitcoin, and Ethereum from January 1st, 2021 through April 30th, 2021

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Also in April, we digested a grand buffet worth of earnings reports as the majority of S&P 500 constituents updated shareholders on their Q1 2021 performances.

The second quarter of 2021 is in full swing, with these key developments occurring in April:

Off the YCharts! Crypto: Come-up + Correction = Correlation

Major Index Returns: April was, in fact, kind to stocks

Sector Movement: 11 out of 11 Winners in April

Hot Stocks of the Month: Earnings Pops

Laggards & Losers: Earnings Drops

 Financial Market & Advisor News

Economic Data: Business Is Booming All Around


Off the YCharts! Crypto: Come-up + Correction = Correlation

That was good alliteration, wasn’t it? 

Speaking of cryptocurrencies, April was another breakout month for several crypto assets, including Bitcoin, Ethereum, Litecoin, and Cardano. But prices corrected just as fast. As market leader Bitcoin goes, so goes the rest of crypto, based on the following price correlations:

2021 YTD Price Change of Bitcoin, Ethereum, Litecoin, and Cardano from January 1st, 2021 through April 30th, 2021

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Major Index Returns: April was, in fact, kind to stocks

AQ, Major Index Returns for April 2021

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April has historically been a positive month for equities, and this year was no different. The NASDAQ rose 5.4% and the S&P 500 went right up with it, adding 5.3%. Internationally, Developed Markets gained 3.1% while Emerging Markets were up 2.5%. Fixed income assets got a long-awaited boost in April, with the Global Aggregate Bond Index and high yield corporate bonds up 1.3% and 1.1%, respectively.


Sector Movement: 11 out of 11 Winners in April

SPDR ETF Sector Movement, April 2021

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All 11 sectors posted positive gains in April. Leading the charge was Real Estate with an 8.3% gain, followed by a near three-way tie for second place among Financials, Consumer Discretionary, and Communication Services. Though down for most of the month, Energy eked out a 0.7% gain thanks to solid earnings from big oil names like Exxon Mobil (XOM).


Hot Stocks of the Month: Earnings Pops

Top ten performing S&P 500 stocks for April 2021

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April’s top ten stocks all made the list thanks to better-than-expected earnings reports. Blowout earnings from logistics giant United Parcel Service (UPS) and credit powerhouses Discover Financial Services (DFS) and Capital One Financial (COF) boosted their share prices significantly.

Strong earnings also helped Equifax (EFX), DISH Network (DISH), Pool (POOL), IQVIA Holdings (IQV), Seagate Technology (STX), Intuitive Surgical (ISRG), and Avery Dennison (AVY) make the cut for April’s ten best performers.


Laggards & Losers: Earnings Drops

Worst performing S&P 500 stocks, April 2021

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Let’s give a warm welcome (back) to laggards Discovery (DISCA), Twitter (TWTR), and Penn National Gaming (PENN), who are in the bottom 10 for the second consecutive month. Twitter plummeted 15.2% after reporting weaker earnings relative to its big tech peers, while investors punished Discovery for its EPS miss and weak DTC subscriber numbers. Intel (INTC) sank on stellar earnings reported by rival chipmaker Advanced Micro Devices (AMD).

Disappointing earnings from Enphase Energy (ENPH), Hologic (HOLX), Citrix Systems (CTXS), Cabot Oil & Gas (COG), F5 Networks (FFIV), and American Airlines Group (AAL) round out April’s ten worst performers.


Financial Market & Advisor News

S&P 500 Is Reporting Third Highest Net Profit Margin for Q1 Since 2008 (FactSet)

Your Complete Guide to Sector Rotation (YCharts)

ETFs see record inflows of $250 billion in first quarter (InvestmentNews)

Wall Street on Tax Plan: ‘It Will Incentivize Selling This Year’ (WealthManagement.com)

Examining SPAC Performance Pre- & Post-Merger (YCharts)

Bitcoin ETF Drumbeat Gets Louder as Eight Issuers File with SEC (Bloomberg)


Economic Data: Business is Booming All Around

Employment

March’s unemployment rate clocked in at 6.0%, the lowest level since April 2020. Initial jobless claims steadily declined throughout April to 553,000 as of the month’s last print, the lowest level in the entire pandemic era.

US Initial Claims for Unemployment Insurance sets record low, April 24th, 2021

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Production and Sales

US Retail and Food Services Sales were up 9.8% in March, the highest month over month change since last May. Durable goods orders ticked up 0.6% in March after a negative February.

Housing

US New Single Family Houses Sold rebounded 20.7% in March after a sharp decline in February, while Existing Home Months’ Supply ticked up another 10 basis points to 2.1. The US house price index rose 0.9% in March, its weakest month over month growth since last May.

Consumers

Prices and spending growth experienced robust growth in March. The US Consumer Price Index rose 0.6%, while consumer spending (PCE) was up by half a percent.

 

Have a great May! 📈

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