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US stocks record biggest monthly gains

Relevance up to 06:00 2022-04-21 UTC–4

During trading on Tuesday, US stock indexes showed a steady rise. Investors have analyzed the earnings reports of the US leading corporations against the background of rising inflation

As a result, the S&P 500 increased by 1.6%, reaching 4462.21. Notably, 10 of the 11 S&P sectors notched a spectacular rise. Only the oil and gas sector logged negative results. Chevron Corp shares sank by 1.2% and Exxon Mobil stocks dropped by 0.9%. Oil and gas giant Halliburton Co. shares decreased by 0.8%. Even the strong earnings report of the company failed to boost the growth of shares. Earlier, the company disclosed an increase in net profit and revenue in the first quarter of 2022.

The Dow Jones Industrial Average rose by 1.5% to 34911.20. On Tuesday, the biggest gainers were the shares of Nike Inc (+4.1%), Boeing Co (+3.4%), and Walt Disney Co (+3.2%).

Meanwhile, the Nasdaq Composite increased by 2.2% to 13619.66. All three leading indexes reported the monthly biggest increase.

Yesterday, the shares of travel companies climbed the most as requirements for travelers to wear masks on airplanes had been lifted. American Airlines Group shares instantly soared by 5.7%, Las Vegas Sands shares surged by 4.3%, and Carnival jumped by 4.6%.

The capitalization of American Campus, the nation’s largest owner, manager, and developer of high-quality student housing communities, skyrocketed by 13%. A rise in chares occurred after a report published by The Wall Street Journal. American Campus Communities is being scooped up by New York investment firm Blackstone in a deal valued at $$12.8 billion.

The shares of Plug Power, the developer of hydrogen fuel cell systems, increased by 9.8% following the news of a deal with retailer Walmart for the supply of hydrogen. Walmart shares also rose by 1.1%.

Hasbro Inc. stocks climbed by 5.2%. In the first quarter of the fiscal year 2022, its net profit dropped by 47%. The reading was below analysts’ forecasts. At the same time, Hasbro Inc’s revenue exceeded market expectations.

The shares of J.B. Hunt Transport Services, one of the leading US companies in the field of cargo transportation, gained 1.4% on Monday. In January-March, its net profit soared by 66%, topping expectations.

Travelers Cos. stocks, one of the largest US insurance companies, sank by 4.9% on Tuesday despite the strong quarterly report. So, in the first quarter, the company’s net profit advanced by 39%, exceeding forecasts.

The market cap of military-industrial concern Lockheed Martin decreased by 1.6% on Monday. In January-March, the company recorded a net profit above experts’ forecasts but its revenue did not meet market expectations.

The shares of the world’s leading manufacturer of health products, Johnson & Johnson, grew by 3.1% despite a 16.9% drop in net profit in the last quarter. At the same time, Johnson & Johnson cut its annual profit forecast but increased dividend payments to shareholders.

Analysts are confident that in the future, the profits of the main US corporations will continue to increase permanently despite higher costs. Positive forecasts are fueling optimism in the equity market even though investors are bracing for rate increases by the Fed.

Since the beginning of 2022, Wall Street readers have been concerned about growing inflation. It has already approached the highest level in four decades. Investors fear that the Fed may start tightening monetary policy more aggressively. However, large American companies were able to pass on increased costs to consumers despite headwinds. Yet, some specular believe that corporate profit growth is likely to decline in the current quarter as it will be more difficult for manufacturers to rise consumer prices higher.

A rally in the stock market was also facilitated by a significant drop in oil prices. Brent Crude lost 5.2%, falling to $107.25 per barrel.

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