This edition features where to look for infrastructure opportunities; the upcoming Berkshire meeting; an earnings roundup; and notes from Sage Group, Caterpillar, and General Dynamics.

Stocks edged lower on Tuesday morning following mixed earnings reports and new consumer confidence data. Tesla shares fell sharply as better-than-expected 1Q earnings were driven more by gains from bitcoin investments and environmental credit sales than by the core auto business. The Conference Board reported that its consumer confidence index rose to 121.7 in April, up from 109.0 in March and the highest level since February 2020, before the start of the pandemic. The Dow fell 0.1%, the S&P 0.1%, and the Nasdaq 0.2%. Crude oil traded near $62.50 per barrel, while gold fell slightly to $1780 per ounce.

Stocks rose modestly on Monday morning at the start of a busy week for 1Q earnings reports, which have thus far been strong. According to FactSet, 84% of S&P 500 companies that have reported 1Q results have topped consensus expectations. On the economic front, the Commerce Department said that core capital goods orders excluding aircraft rose 0.9% in March, up from a 0.8% decline in February but below the Reuters consensus forecast of 1.5% growth. The Dow rose 0.1%, the S&P 0.2%, and the Nasdaq 0.6%. Crude oil traded near $62 per barrel, while gold rose slightly to $1778 per ounce.

The stock market moved lower last week, then rallied on Friday, ultimately finishing flat-to-down. Tech stocks and blue chips performed similarly, with tech narrowly outperforming. During Friday's session, the Dow Jones Industrial Average increased 228 points, or 0.67%. The S&P 500 was up 1.09%, and the Nasdaq Composite was up 1.44%. For the week, the DJIA was down 0.46%, the S&P 500 was up 0.13%, and the Nasdaq Composite was down 0.25%. Year-to-date, the DJIA is up 11.23%, the S&P 500 is up 11.29%, and the Nasdaq Composite is up 8.76%.

For the past two weeks, we've discussed sentiment improvement among corporate executives, directors and beneficial owners (albeit on low transaction volume that is typical during earnings season). Prior to that, the weekly data from Vickers Stock Research showed insiders were generally cautious for the past few months, and insiders at Technology sector firms were particularly cautious. But that all started to fade lately, as sentiment among sectors moved back towards alignment and overall sentiment improved. But this week, everything old is new again.

This pick list highlights constituents of the Morningstar US Large Cap Index that we believe offer investors the best risk-adjusted return prospects. Stocks of large-cap companies where neither growth nor value characteristics predominate. Stocks in the top 70% of the capitalization of the U.S. equity market are defined as large cap.

Stocks fell on Monday morning, led by the Technology and Communication Services sectors, as investors awaited the first 1Q earnings reports from major banks on Wednesday. Earnings from S&P 500 companies are expected to rise 25% in the first quarter, according to data from Refinitiv. On the M&A front, Microsoft said that it would acquire AI and speech recognition company Nuance Communications in a $19.7 billion deal. The Dow fell 0.2%, the S&P 0.2%, and the Nasdaq 0.5%. Crude oil traded near $60 per barrel, while gold fell $12 to $1733 per ounce.

This pick list highlights constituents of the Morningstar US Mid Cap Index that we believe offer investors the best risk-adjusted return prospects. The market capitalization range for U.S. mid-caps typically falls between $1 billion and $8 billion and represents 20% of the total capitalization of the U.S. equity market.

April is typically a good month for stocks. Since, 1980, the average gain for the S&P 500 in April is 1.87%, trailing only November's average gain of 1.93%. We note that market returns in April have exceeded 5% on seven occasions since 1980, including a 9.4% gain in 2009 (as the market was beginning to recover from the financial crisis of 2007-2009) and a 12.7% surge last year (as the market started to recover from the onset of the COVID-19 pandemic). There have been some clunkers, including 2002 (-6.1%), 2000 (-3.1%) and 1981 (-2.3%). April is a busy month on Wall Street, as companies report first-quarter results. This year, those results are expected to be strong, as comparisons will be against a 1Q20, when industries and economies began to shut down to fight COVID-19. Later in the month, investors will also get the first look at 1Q21 GDP growth, which we think will rise from the 4.3% pace of 1Q and may come close to 6.0%. Bond yields have been ticking higher in recent weeks, as investors prepare for stronger economic growth.

Just when anxiety over the market's direction started to intensify, the S&P 500 said, 'I got this,' and ended the 3/26/21 trading week at a new all-time closing high (ATH). Note that the closing price was less than a half-point above the prior ATH set on 3/17/21, which in market terms seems like a lifetime ago.

President Joe Biden is preparing to announce an infrastructure-rebuilding plan that he estimates will create up to 10 million clean energy jobs. The following areas of the economy stand to benefit from the government spending, which could total as much as $4 trillion. The first element of the plan is improving the country's infrastructure, from roads and bridges to water systems and electricity grids.

Stocks rose on Friday morning on positive economic data. The U.S. Labor Department reported that for the 12 months ended February 2021, the annual core inflation rate is 1.3%. The University of Michigan's March consumer sentiment index came in at 84.9, up from February's 76.8 and above the 83.6 consensus estimate. The Dow rose 0.5%, the S&P 0.6%, and the Nasdaq 0.4%. Crude oil prices traded at $61 per barrel, while gold rose $7 to $1732 per ounce.