5 Top Momentum Stocks Flying High Amid Coronavirus-Led Rout
Zacks Investment Research | Mar 02, 2020 06:20AM ET
The second half of February saw U.S. stock markets tumble on apprehensions regarding the rapid spread of coronavirus globally. The COVID-19 virus led epidemic has already affected nearly 89,000 people across 55 countries and accounted for 3,000 deaths so far. Market participants remain perplexed about global economic growth with China, the backbone of global supply-chain system, in jeopardy.
Wall Street’s February Meltdown
Wall Street collapsed in February, especially in the last two weeks. In February, the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — shed 10%, 8.4% and 6.4%, respectively. This disappointing performance put these three indexes in the negative territory year to date with a loss of 11%, 8.6% and 4.5%, respectively.
Notably, for the week ended Feb 28, the Dow, the S&P 500 and the Nasdaq Composite —tumbled 12.4%, 11.5% and 10.5%, respectively, recording their worst-ever weekly decline since October 2008. In this week, around $6 trillion of investor’s money evaporated from the system.
All these indexes are currently in correction territory (defined as a decline of 10% but not more than 20% from its recent high level). Notably, the Dow’s latest high was recorded on Feb 12 while both the S&P 500 and the Nasdaq Composite touched fresh highs on Feb 19. The Dow lost 3,583 points in the last week of February, marking its largest weekly decline pointwise. Meanwhile, 96% stocks of the entire S&P 500 index is in correction territory.
Severe volatility has gripped U.S. stock markets in the last four trading sessions. In the previous week, The CBOE VIX — which reflects S&P 500 option bets to calculate expectations for volatility over the coming 30 days — skyrocketed nearly 135% to close at 40.11. On Feb 28, the volatility index touched 49.48 — the highest level since February 2018.
5 Momentum Stocks Flying High
Despite the collapse of Wall Street owing to the outbreak of the coronavirus, a handful of stocks have withstood the market mayhem. Meanwhile, momentum investing calls for a continuous appraisal of stocks, which ensures that an investor does not pick a beaten-down name and overlook a thriving one. Momentum investors buy high on the anticipation that the stock will only ascend in the short to intermediate term.
We have narrowed down our search to five momentum stocks that have popped in the last month. All these stock witnessed solid earnings revisions in the last 30 days and have robust growth potential. Each of our picks carry a Zacks Rank #1 (Strong Buy) and a Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.