Major benchmarks posted significant gains over the past one month led by bullish factors like a strong rally in crude and encouraging economic data. Coming to figures, the Dow, S&P 500 and tech-laden Nasdaq Composite Index gained a respective 6.5%, 6.4% and 6.4%.     

Moreover, the Dow moved north for the fifth straight session on Mar 17, ending with a year-to-date gain for the first time this year. Meanwhile, the fear-gauge CBOE Volatility Index (VIX) – a popular measure of volatility – plunged more than 29% in the trailing one month, indicating that the markets are nearing stabilization. At such a juncture, investing in stocks with high year-to-date gains and strong fundamentals may prove to be profitable.

Factors That Drove Markets

Crude Gains: From a 13-year low level of $26.05 a barrel as on Feb 11, the commodity price rebounded to $40.20 per barrel. The impressive upside came on the back of improving demand/supply dynamics, which are rebuilding investors’ confidence in the rebalancing of the oil market.

The improvement in crude prices has been inspiring lately, thanks to the statements made by major oil producers which hint at an impending cut on crude production. In fact, Qatari oil minister Mohammed Bin Saleh Al-Sada has stated that major oil producers, both OPEC and non-OPEC players, will meet in Doha on Apr 17 to discuss a production freeze.

Positive Economic Data: The U.S. Department of Commerce has reported a 5.2% improvement in housing starts in February from January, marking a five-month high seasonally adjusted annual rate of 1,178,000, higher than the consensus estimate of an increase to 1,144,000. Nine-year high gains in construction of single-family houses were the main reason behind the improvement.

Moreover, the core CPI, which excludes food and energy prices, gained 0.3% last month, higher than the consensus estimate of 0.2%. Core CPI increased 2.3% year over year, highlighting the highest increase since May 2012.

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