The Real Money Post Industrial Average RMPIA enjoyed a stellar first half of 2019 performance. I used the word enjoyed purposefully because RMPIA beat nearly all the major domestic stock market averages on an absolute and relative basis, with its 20.4% gain for the first six months of the year. That compares to 17.3% for the S&P 500 and 14% for the Dow Jones Industrial Average.
For the first half of 2019, one third of RMPIA's constituents delivered gains in excess of 30%, which more than made up for the five -- Walgreens Boots (WBA) , Regeneron Pharmaceuticals (REGN) , Kraft Heinz (KHC) , Biogen (BIIB) and Amgen (AMGN) -- that were a drag during the first six months of the year.
Like several market indices, the majority of RMPIA's gains in the first half came during the March quarter, led by Celgene Corp. (CELG) , Accenture (ACN) , Netflix (NFLX) , Facebook (FB) and MasterCard (MA) . The second quarter's gain of more than 6% for RMPIA predominantly came during the month of June -- as with the larger stock market, May's woes erased its April gains. It was the outperformance due to surges in Allergan (AGN) , Booking Holdings (BKNG) , Qualcomm (QCOM) and Kraft Heinz (KHC) that powered RMPIA nearly 9% higher for June, well ahead of all four major stock market averages.
Digging into RMPIA's performance between the first and second quarters, we did see several interesting shifts in performance. For example, shares of Alphabet (GOOGL) climbed nearly 13% during the March quarter but fell 8% during the June one. The same was true with Broadcom (AVGO) as well as Regeneron shares.
In the May write up for RMPIA's results, I shared how a number of constituents are well positioned for the structural changes we are contending with. Little has changed in that regard over the last month.
Those who have read my musings know that when assessing full-year EPS forecasts for the S&P 500, I tend to examine second half vs. first half comparisons. This year, the expectation is for the S&P 500 group of companies to grow their collective earnings by 10% in the second half compared to the first. While some of this expectation reflects normal seasonality, particularly among technology, consumer goods, retailers and other categories, my view remains that 10% forecast is likely to be trimmed back in the June quarter earnings season.
But back to the seasonality factor. There are a number of companies inside RMPIA that will be likely beneficiaries of Back to School and holiday shopping, as well as holiday spending -- especially as consumers continue to shift to digital shopping. These include Amazon (AMZN) , Costco Wholesale (COST) , Kraft Heinz, Mastercard, Nike (NKE) and Starbucks (SBUX) .
We'll need to watch the second half launches of Apple's AppleTV+, Disney's (DIS) Disney+ and AT&T's (T) WarnerMedia to see if they accelerate consumer abandonment of the triple-play at Comcast (CMCSA) and pressure Netflix. We'll also have to monitor privacy developments and what they could mean for both Facebook and Alphabet.
