Stocks Take A Breather, Earnings In Focus

Plus 5 New Strong Buys for Today [Kevin Matras] Profit from the Pros By Kevin Matras Executive Vice President [Zacks Investment Research] Stocks Take A Breather, Earnings In Focus Image: Bigstock Stocks closed lower yesterday, although the Dow and the S&P are still positive for the week with one more trading day to go. It's been a fast-paced week up until yesterday, so it's not surprising to see the market hit pause in a lower volume day. The market is still watching the rise in case counts, but continues to shrug it off. There's plenty of excitement regarding the developments on vaccines. But trials are trials, and there's still a ways to go before we get any approvals. Talk of another stimulus bill is still grabbing headlines. But details are few. While there may be some consensus in private, it sounds less so in public. So earnings should likely provide direction for the time being. While earnings season has really just begun, it's gotten off to a good start. Although, with Netflix down roughly -10% yesterday in after-hours trade after missing on earnings after the close (-12.15% negative EPS surprise, although a positive 1.15% sales surprise), and issuing lower subscriber growth guidance in Q3, the market could come under some pressure today. The market should also continue to get its cues from the economic reports. But yesterday's better than expected Retail Sales report (up 7.5% m/m vs. 5.2% expected), Housing Market Index (up 24% at 72 vs. the consensus for 60), and the Philadelphia Fed Business Outlook Survey (print of 24.1 vs. estimate for 20.0) were seemingly offset by a slightly larger than expected Weekly Jobless Claims report where 1.300 million new claims were filed vs. expectations for 1.288 mil. Stocks continue to trade within a few percent of their recovery highs. Given that, it wouldn't take much in the way of good news to send stocks higher in an upside breakout. In the meantime, keep your eyes on the big picture. As the economy continues to reopen (setbacks notwithstanding), we should continue to see strong economic reports, and that projects more upside to come. Best, Kevin Matras Executive Vice President, Zacks Investment Research Sponsor [Why Haven't You Looked at Zacks' Top Stocks?]( Our 5 best-performing strategies have blown away the S&P's impressive +53.6% gain from 2017 through 2019. Amazingly, they soared +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%. Today you can access their live picks without cost or obligation. [See Stocks Free >>]( Most Popular Articles from Zacks.com Image: Bigstock [3 Cheap Tech Stocks Under $10 to Buy During Q2 Earnings Season]( Despite real concerns, the Nasdaq rests near its recent highs, as the sector proves more immune to the coronavirus economic downturn. 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