BOSTON (TheStreet) -- October's rally lit a fire under many laggard stocks. Seventeen S&P 500 Index companies gained at least 40% last month, and the benchmark index's top 10 gainers are up 45% to 57%.
The S&P 500 surged 11% in October, the best monthly performance since 1991. Still, stocks are little changed this year after two years of gains. Investors are concerned about a sluggish U.S. economy that could deteriorate if Europe's debt woes worsen.
Six of the top 10 performers on the S&P 500 are energy companies, and two are auto-industry suppliers, suggesting investors amped up the so-called risk-on trade.
"It's the worst who become first" in these types of rallies, said Sam Stovall, S&P Capital IQ's equity analyst, in an interview. "It's those companies that were priced as if they are going out of business that are the ones that tend to rally the most."Companies in the energy, materials, industrials, financials and consumer-discretionary sectors led the rally, which paused yesterday, with the S&P 500 slumping 2.5%. "It is, therefore, logical that they are among the greatest advancers in this most recent snap-back rally," Stovall said. Stocks are all benefiting from a renewed sense of optimism on the heels of European leaders' tentative agreement last week on a restructuring package for the eurozone nation's with sovereign debt problems. And, domestically, there has been a series of better-than-expected economic reports allaying fears of recession, along with a steady run of strong third-quarter earnings reports from U.S. companies, further buttressing investors' positive views. Of the 181 S&P 500 companies that reported earnings as of Oct. 25, 66% beat Wall Street analysts' estimates, 23% missed and 11% met expectations, according to S&P Capital IQ. Here are the top 10 performing S&P 500 stocks in October, through Friday, Oct. 28, in inverse order: 10. El Paso Corp. (EP) shares are up 45.5% last month and 85% this year. The company owns the largest oil and gas pipeline network in the U.S. and also operates a gas-storage and liquefied natural gas import facility. Its shares are benefiting from a planned merger with competitor Kinder Morgan (KMI). The deal will include the sale of El Paso's exploration and production assets and the subsequent combination of its huge pipeline operations with those of Kinder Morgan to create the dominant oil and gas pipeline network in the nation, bringing fuel to both the East and West Coast markets.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV