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Commentary

What Investors Were Researching in April

Investors remained focused on moats and income in April, while plummeting gold prices raised interest in gold-focused ETFs.

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Stocks added on to big first-quarter gains in April. The broad-based Morningstar US Market Index was up 2.2% in the month after posting a return of more than 11% in the first quarter and a 16% return in 2012.

The month's market news was mostly dominated by earnings reports. By and large, earnings were unexciting. Results were generally in line with expectations, but many analysts were disappointed by outlooks for the second quarter and the rest of 2013. Management teams remain very cautious in the face of intense economic pressure in Europe, slowing emerging-markets growth, and continued uncertainty in the United States. One sector, that came in well below expectations was technology. A sharp decline in PC sales in the first quarter, some product-cycle changes, and a lull in enterprise-hardware spending hit firms such as 
 International Business Machines (IBM) hard. 

Economic data was a mixed bag last month. Readings on manufacturing, jobs, housing, and other sectors showed that the U.S. economy was not careening toward a recession, but it wasn't in a boom time either. 

So why did stocks keep rising against this backdrop? Morningstar's director of economic analysis Bob Johnson thinks the primary driver is that middling economic data has soothed investor fears that the Fed was going to take its foot off the bond-buying pedal. With the economy stuck in slow-growth mode, it is much less likely that the Fed will begin tightening anytime soon. 

Gold was also in the headlines during April, as the commodity fell precipitously. A fear of central bank sales, momentum, and the Chinese economic slowdown appeared to be the biggest drivers

Against this backdrop, what were investors checking out on Morningstar.com during the month? Below are the 25 most viewed stock, mutual fund, and exchange-traded fund reports in April.

 Most Viewed Stock Analyst Reports in April 2013
Name Ticker Moat Star Rating March Return
Apple AAPL Narrow 0%
National Oilwell Varco NOV Wide -8%
General Electric GE Wide -4%
Johnson & Johnson JNJ Wide
5%
Intel  INTC Wide
10%
Exxon Mobil XOM Wide
-1%
Suncor Energy
SU Narrow
4%
Caterpillar CAT Wide
-2%
Cisco Systems CSCO Wide
1%
BHP Billiton BHP Narrow
-2%
Wells Fargo WFC Narrow
3%
Microsoft MSFT Wide
16%
Chevron CVX Narrow
3%
Alcoa AA Narrow
0%
Facebook FB Wide 9%
Apache APA Narrow
-4%
Exelon EXC Wide 9%
KDDI KDDIY Narrow Under Review 17%
France Telecom FTE Narrow
5%
Baidu BIDU Narrow
-2%
Coca-Cola KO Wide 5%
AT&T T Narrow
3%
eBay EBAY Wide
-3%
Western Union WU Wide
-2%
Daimler DDAIF None
6%
Source: Morningstar

 Apple (AAPL) once again dominated the most viewed reports in the month. Two wide-moat names trading under their fair value estimates,  National Oilwell Varco (NOV) and  General Electric (GE), rounded out the top three. Investors kept their focus on moats last month, with only one of the most researched stocks
Daimler (DDAIF)) having no moat. 

 Most Viewed Open-End Fund Analyst Reports in April 2013
Name Ticker Morningstar Category Star Rating March Return
Vanguard Cap Opp VHCOX Large Growth
3%
Vanguard Div Growth VDIGX Large Blend 3%
Fidelity Sml Cap Disc FSCRX Small Blend -1%
Vanguard Wellington VWELX Mod Allocation 2%
Yacktman YACKX Large Blend 2%
Vanguard Wellsly Inc VWINX Conserv Allocation 2%
Fidelity Flt Rt High Inc FFRHX Bank Loan 1%
Dodge & Cox Intl Stk DODFX Foreign Lg Blend 4%
Primecap Odsy Ag Gr POAGX Mid-Cap Growth 1%
Dodge & Cox Glbl Stk DODWX World Stock 3%
Fidelity Contrafund FCNTX Large Growth 2%
Dodge & Cox Income
DODIX Interm-Term Bond 1%
PIMCO Total Return PTTRX Interm-Term Bond 1%
FMI Large Cap FMIHX Large Blend 2%
Oakmark Intl OAKIX Foreign Lg Blend 6%
T. Rowe Eq Inc PRFDX Large Value 2%
Primecap Odsy Gr POGRX Large Growth 3%
Primecap Odsy Stk POSKX Large Blend 2%
Fidelity Strtgic Inc FSICX Multisector Bond 2%
Oakmark Global OAKGX World Stock 4%
Dodge & Cox Stock DODGX Large Value 2%
Fidelity New Mkts Inc FNMIX Emerg Mkts Bond 2%
T. Rowe Cap Apprec PRWCX Mod Allocation 1%
Templeton Global Bd TPINX World Bond 2%
FPA Crescent FPACX Mod Allocation 2%
Source: Morningstar

 Vanguard Capital Opportunity (VHCOX) was the most researched fund, moving up from the 23rd most read Analyst Report last month. Alternative sources of income appear to be top-of-mind for many researchers, as investors checked out dividend-focused funds ( Vanguard Dividend Growth (VDIGX)), bank-loan funds ( Fidelity Floating Rate High Income (FFRHX)), and world-bond offerings ( Templeton Global Bond (TPINX)).

 Most Viewed ETF Analyst Reports in April 2013
Name Ticker March Return
Vanguard Dividend Appreciation VIG 2%
SPDR Gold Shares GLD -8%
Vanguard High Div Yield Indx ETF VYM 3%
Vanguard REIT Index ETF VNQ 7%
JPMorgan Alerian MLP Index ETN AMJ 2%
PIMCO Total Return ETF BOND 1%
Vanguard FTSE Emerg Markets ETF VWO 1%
iShares S&P U.S. Preferred Stk Idx PFF 1%
ALPS Alerian MLP ETF AMLP 0%
iShares Core S&P 500 ETF IVV 2%
Vanguard Consumer Staples ETF VDC 3%
Vanguard Glbl ex-US Real Est ETF VNQI 7%
WisdomTree Japan Hedged Equity DXJ 10%
iShares MSCI Emg Mkt Min Vol Idx EEMV 3%
Vanguard Small Cap Value ETF VBR 0%
Vanguard Total Bond Market ETF BND 1%
iShares Gold Trust IAU -8%
iShares MSCI USA Min Volatility USMV 3%
Market Vectors Gold Miners ETF GDX -20%
PowerShares Intl Div Achievers PID 2%
PowerShares S&P 500 Low Vol SPLV 4%
WisdomTree Emg Mkt SmallCap Div DGS 2%
PowerShares Senior Loan Port BKLN 1%
PIMCO Enhanced Short Mturty ETF MINT 0%
SPDR S&P Dividend SDY 2%
Source: Morningstar

The plunge in gold prices led to increased interest in gold exchange-traded funds such as  SPDR Gold Shares (GLD),  iShares Gold Trust (IAU), and  Market Vectors Gold Miners ETF (GDX). Beyond gold, income-producing investments such as  Vanguard Dividend Appreciation ETF (VIG) and  JPMorgan Alerian MLP Index ETN (AMJ) dominated the most researched ETFs.  

Star ratings as of May 7. All other data as of May 30. 

Jeremy Glaser has a position in the following securities mentioned above: MSFT. Find out about Morningstar’s editorial policies.