Wall Street Heads for Best August in 36 Years: 5 Top Gainers

On Aug 28, Wall Street ended the week and day higher, positioned to notch the market’s best August performance since the 1980s. So far this month, major bourses have reached or approached record highs. The S&P 500 index is up 7.2% month to date, and if the gains hold until […]

On Aug 28, Wall Street ended the week and day higher, positioned to notch the market’s best August performance since the 1980s. So far this month, major bourses have reached or approached record highs.

The S&P 500 index is up 7.2% month to date, and if the gains hold until trading finishes on Aug 31, the broader-market index would register its biggest gain since 1984, according to the Dow Jones Market Data. In fact, the S&P 500 ended the last trading session at a record high and grew 3.3% for the week.

Similarly, the Dow closed in the positive for the year on Aug 28, completely erasing its coronavirus-induced losses. The Dow closed the session with a year-to-date gain of 0.4% and is just 3% shy of its Feb 12 record closing high. For the month so far, the blue-chip index has rallied more than 8% and is also headed for its best August in 36 years.

Notably, the August rally is built on the stock market’s sharp rebound from the Mar 23 lows. Since then, the Dow and the S&P 500 have jumped 57% and 60.1%, respectively. Separately, the tech-heavy Nasdaq is up 8.8% so far this month and is on track for its best August since 2000. The index had notched a fresh record on Aug 28.

Talking about tech stocks, Apple Inc. AAPL has been one the biggest contributors to the market’s gains this month. The iPhone maker’s shares are up 18% so far this month, and the company breezed past the coveted $2-trillion market cap for the first time earlier in August. The company, no doubt, has proven to be resilient to the coronavirus pandemic, and still generates a bulk of its revenues by selling high-priced devices, primarily made in China.

At the same time, Apple is joined by Microsoft, Amazon, Alphabet and Facebook, which together make up more than a fifth of the S&P 500 and is responsible for almost third of the gains since the recent rally started. But let’s admit, gains among a majority of e-commerce stocks, construction players and financials also powered the benchmarks this month.

Most importantly, growing confidence around coronavirus treatments helped the stock market scale higher. Additionally, positive moves were fueled by the Fed’s commitment to keep the interest rates close to zero for a very long time.

The Fed recently introduced an inflation policy framework that would keep rates lower. The central bank ended its practice of pre-emptively hiking rates in case of higher inflation. Earlier this year, the Fed trimmed its interest rates to near zero and launched an open-ended asset purchasing program to strengthen the economy affected by the pandemic.

And talking about consumers, their confidence on their well-being remained high in the month of August. The University of Michigan’s August consumer sentiment index read 74.1, up from 72.5 in July.

5 Top Winners

With Wall Street set to see its best August in 36 years banking on coronavirus treatment optimism, Fed’s plan to keep rates low even if inflation rises and growing consumer confidence put the spotlight on stocks with the best month-to-date gains. These stocks also have more room to move northward in the near term. These stocks flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy).

Story continues

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Click to get this free report
 
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salesforce.com, inc. (CRM) : Free Stock Analysis Report
 
Liquidity Services, Inc. (LQDT) : Free Stock Analysis Report
 
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BMC Stock Holdings, Inc. (BMCH) : Free Stock Analysis Report
 
TFF Pharmaceuticals, Inc. (TFFP) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Apple Inc. (AAPL) : Free Stock Analysis Report
 
salesforce.com, inc. (CRM) : Free Stock Analysis Report
 
Liquidity Services, Inc. (LQDT) : Free Stock Analysis Report
 
Live Oak Bancshares, Inc. (LOB) : Free Stock Analysis Report
 
BMC Stock Holdings, Inc. (BMCH) : Free Stock Analysis Report
 
TFF Pharmaceuticals, Inc. (TFFP) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
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