S&P 500: 3 Stocks Turned $10000 Into $28329 In 3 Months – Investor's Business Daily

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Beware March? Hardly. S&P 500 investors scored their biggest monthly gain of the year in the third month — putting them in a powerful position at new highs going into April.

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Eight companies like materials firm Nucor (NUE), financial Hartford Financial (HIG) and technology company DXC Technology (DXC) jumped more than 20% just in the month of March, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith.

All told, had you invested $10,000 in January and reinvested your money into the top stocks currently in the S&P 500 each month this year, including in March, you’d have $28,329. That’s a solid three-month gain of 183%. That sure beats the 5.8% rise in the S&P 500 this year so far, which only turned a $10,000 investment into $10,577.

Hindsight is 20/20. And clearly, few if any investors could have pulled this off as it’s not a repeatable strategy. But the staggering numbers are a reminder to investors that big gains are possible in times the market’s leadership is changing.

Materials And Industrials Wake Up

Now that S&P 500 investors are counting the days until the economy reopens further, additional sectors are joining the rally.

Almost half of the top 10 S&P 500 stocks in March hail from either the materials or industrial sectors. These sectors were largely left out of 2020’s strong tech-driven gains. And it’s a logical follow-up on strong jumps in energy stocks earlier in the year.

The Industrial Select Sector SPDR ETF (XLI) and Materials Select Sector (XLB) are now up 11.2% and 8.9%, respectively, this year. That makes them the No. 3 and No. 4 best sectors of the year following a 29.2% rise in energy stocks and 15.5% jump in financials.

The top S&P 500 stock in March is a materials company. Steelmaker Nucor saw its shares soar 34% just in the month of March. Investors all but wrote off 2020, when profit per share inched up just 3.8%.

But it’s all about 2021 now. Analysts are calling for strong demand for specialized steel like Nucor’s to push profit up more than 116% in 2021. You’d be hard pressed to find a megacap technology company growing that fast. Nucor is now a market leader with an IBD Composite Rating of 97, indicating its fundamentals and stock action top 97% of all others.

Top S&P 500 Stocks In March 2021

Company Symbol March % Gain Sector Composite Rating
Nucor (NUE) 34.2% Materials 97
Hartford Financial Services (HIG) 31.8% Financials 85
Kansas City Southern (KSU) 24.3% Industrials 81
DXC Technology (DXC) 23.9% Information Technology 71
Lennar (LEN) 22.0% Consumer Discretionary 95
AutoZone (AZO) 21.1% Consumer Discretionary 68
Dentsply Sirona (XRAY) 20.2% Health Care 55
Boeing (BA) 20.1% Industrials 37
 Sources: IBD, S&P Global Market Intelligence

S&P 500 Technology Takes A Backseat

Here’s a place S&P 500 technology investors aren’t used to being in: The middle. The Technology Select SPDR ETF (XLK) is only up 2.1% this year. This puts the former pole-position sector just ninth among the 11 S&P 500 sectors this year so far.

Only one technology firm, DXC, is in the top 10 S&P 500 stocks in the month of March. Shares of the tech outsourcing company jumped 23.9% in the month, ranking it fourth. Investors seem to be trying to get in ahead of the company’s easily beaten earnings targets. Analysts think profit this year will fall 57%. And yet, the company in early February reported fourth-quarter profit that beat view by 55%.

Setting The S&P 500 Up For April

Hopes are high the S&P 500’s strength will continue into April, historically a strong period for stocks.

April is the second-best month for the S&P 500 going back to 1950, says Ryan Detrick, chief market strategist at LPL Financial. And it’s been the very best month of the year going back the past 20 years. Just last April, the S&P 500 vaulted 12.7%, making it the third-best month for stocks since 1950, Detrick found.

“What more can we say other than few months have been kinder to stocks lately than the month of April,” he said.

Top Current S&P 500 Stocks Each Month In 2021

Being in the right stock each month turned $10,000 into $28,329

Month Top S&P 500 Stock Symbol Stock Monthly % Gain Sector S&P 500 % Monthly Ch. Beg. Bal. Cumulative Value Of $10,000 Investment In January Reinvested In Top Stock Each Month Composite Rating
January Discovery (DISCA) 37.7% Communication Services -1.1% $10,000 $13,770 74
February Marathon Oil (MRO) 53.3% Energy 2.6% $13,770 $21,109 46
March Nucor (NUE) 34.2% Materials 4.7% $21,109 $28,329 97
Sources: IBD, S&P Global Market Intelligence

Follow Matt Krantz on Twitter @mattkrantz

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