Retailers lift stocks back into the green

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When you hear about a retailer jumping double digits in a single session, then you'd probably assume its something like Amazon. Because traditional department stores are dead and waiting to be buried, right?

Macy's begs to differ.

The over 150-year-old retailing staple reported a strong first quarter today, which included an impressive 13-cent beat, stronger-than-expected revenues and a raised full-year outlook. Also, while online sales jumped by double digits, shoppers were also physically coming into their stores. Shares were up 10.8% on the day.

The solid Macy's report lifted the whole retail sector on Wednesday, helping the market to rebound from yesterday's pullback. The NASDAQ advanced 0.63% to 7398.3 and the S&P increased 0.41% to 2722.5. The Dow ended its 8-session winning streak on Tuesday but was back to its winning ways today with a gain of 0.25% to 24,768.9.

The major indices are busy crawling back to all-time highs after the three-month correction, but the Russell 2000 has already made it. The small-cap index hit a new intraday record on Wednesday and is now up more than 5% for the year, which is easily outperforming the S&P's less than 2% advance and the Dow's barely breakeven performance.

Stocks gained ground even though the 10-year Treasury note continued to rise on Wednesday. The indices hit a wall yesterday when the mark jumped past 3% to its highest point in nearly 7 years. It'll be interesting to see if the market continues to shrug off the 10-year and geopolitical concerns to focus more on the strong data from this earnings season and the overall economy.

"The retail name that have been trickling in are confirming the strength of the US consumer. I'm hoping that's enough to kick this market in the pants," said Dave Bartosiak, editor of Surprise Trader , Momentum Trader and Blockchain Innovators . "Eventually, the higher beta stocks in the Russell and NASDAQ should get us some risk-on happening in the market which should tug the entire equity market along with it."

Today's Portfolio Highlights:

Surprise Trader: For 10 straight quarters now, Brady Corp. (BRC) has beaten the Zacks Consensus Estimate. Dave thinks this identification solutions company is set to surpass expectations again when it reports next Thursday, May 24. BRC has a positive Earnings ESP for the report, while EPS growth for the quarter is expected to be close to 14%. The editor added the stock on Wednesday with a 12.5% allocation. Read the full write-up for a lot more on this new pick.

Home Run Investor: The newest addition to the portfolio is both a security play AND an Internet of Things (IoT) play. Everbridge (EVBG) is a software company that provides communication and enterprise safety applications. In other words, it provides mass notifications, community engagement and secure messaging for the IoT. The stock caught Brian Bolan's attention with its recent quarterly report, which included a smaller than expected loss and better than expected revenues. Meanwhile, the editor also sold Heritage Commerce (HTBK) for a return of more than 7% in about 5 months. Read the complete commentary for more on today's moves.

Have a Good Evening,
Jim Giaquinto

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Stocks
Referenced Symbols: BRC , EVBG , HTBK

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