U.S. equities pushed to new highs on Tuesday thanks to a resumption of the “Trump-flation” trade — optimism over the economic policies of President Donald Trump.
Excitement continues over priorities including tax cuts, deregulation and more aggressive “America first” trade policies.
The S&P 500 is knocking on a new record thanks to reinvigorated interest in “hard economy” stocks — mainly big industrials and core technology names — that drove the historic post-election rally.
While some technical worries remain, including extended sentiment and evidence “smart money” traders are moving into protection against a selloff, here’s a look at four big-cap stocks that are driving the day’s advance:
Blue-Chip Stocks Leading the Push: Intel (INTC)
Intel Corporation (NASDAQ:INTC) shares are rising up and over a two-month consolidation range to challenge highs not seen since October. The company’s recent efforts have focused on new areas of growth, including autonomous transportation, virtual reality/augmented reality and cloud computing; but if Trump successfully encourages a ramp up in capital expenditures and hiring across the corporate sector, there will be a surge of demand for regular PCs and servers as well, which remain at the heart of the company’s revenue stream.
The company will next report results on Jan. 26 after the close. Analysts are looking for earnings of 75 cents per share on revenues of $15.8 billion.
Blue-Chip Stocks Leading the Push: Caterpillar (CAT)
Caterpillar Inc. (NYSE:CAT) shares are rising up and over a three-month downtrend to push to levels not seen since November 2014 — capping an incredible rise of over 70% off of its January 2016 lows.
Initially, the rebound was driven by a stabilization of crude oil and commodity prices early last year, but more recently, Trump’s surprise electoral win and promises to harness America’s energy and metals recourses is lifting expectations of heavy equipment sales.
The company will next report results on Jan. 26 before the bell. Analysts are looking for earnings of 67 cents per share on revenues of $9.8 billion.
Blue-Chip Stocks Leading the Push: Cisco (CSCO)
Cisco Systems, Inc. (NASDAQ:CSCO) shares are rising up and out of a multimonth downtrend pattern that started in September after testing support at its 200-day moving average in early December. The stock was slammed lower in November after reporting in-line revenue and issuing weak forward guidance.
But, again, any boost to capex and profitability associated with Trump’s economic plans will lift network hardware and software spending and boost CSCO.
The company will next report results on Feb. 15 after the bell. Analysts are looking for earnings of 56 cents per share on revenues of $11.6 billion.
Blue-Chip Stocks Leading the Push: IBM (IBM)
International Business Machines Corp. (NYSE:IBM) is surging to new highs, blasting out of a two-month consolidation range to hit levels not seen since September 2014. This follows what was initially a disappointed reaction to the company’s reporting of better-than-expected quarterly earnings last week and the issuance of strong forward guidance.
Revenue did, however, decline 1.3% from last year to continue a long string of revenue declines.
The company will next report results on April 18 after the close. Analysts are looking for earnings of $2.35 per share on revenues of $18.4 billion.
Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. A two-week and four-week free trial offer has been extended to InvestorPlace readers.
