Market Insider

Record highs in April, but the case for not selling in May

Stocks closed out April with a bang, and while traders may not sell in May this year, the divergence between the large cap and value plays, and the small caps and momentum names, could continue.

The Dow closed at a record high Wednesday, its first of the year, and it is back to where it started in 2014. The Dow was up 0.8 percent in April, after rising 8 points Wednesday to 16,580. But the Nasdaq and small cap Russell 2000 finished the month with losses.

Traders are watching the 1,885 level on the as the next hurdle for big caps, after the S&P broke out of a recent resistance band between 1,877 and 1,881. The S&P 500, up 5 points at 1,883 Wednesday, is up 0.6 percent for the month of April and is up 1.9 percent for the year so far.

Nasdaq was off 2 percent in April, to 4,114, and the Russell was off 4 percent at 1,126.