Despite a downward revision to the first quarter US GDP to negative 1.0% and further mixed economic data, the Dow Jones Industrial Average and S&P 500 gained 0.8% and 2.1% in May, respectively, to close at record highs. The NASDAQ rebounded 3.1% following losses in the previous two months. For the first quarter, the Dow, S&P 500 and NASDAQ are up 0.8%, 4.1% and 1.6%, respectively.

All four IBO Stock Indexes registered strong gains in May, led by the Diversified Instrumentation Stock Index, which advanced 3.9%. The Laboratory Instrumentation, Process/Metrology/Motion Instrumentation and Lab Consumables/Equipment Stock Indexes increased 3.5%, 2.2% and 1.5%, respectively.

Laboratory Instrumentation Stock Index

This month, the Index gained 3.5% to 1030.45 and is up 5.7% for the year. Following two months of declines, Illumina jumped 16.5% in May to lead the Index. Three other companies posted double-digit gains due to positive earnings reports. Pacific Biosciences climbed 12.2%. The company soared 17.0% on May 1 after beating analysts’ sales expectations, and JPMorgan upgraded the company from “Underweight” to “Neutral” with a $7 price target. Sequenom jumped 12.5% for the month, including a rise of 8.6% on May 2 after it cut its first quarter adjusted EPS loss in half. Affymetrix reaffirmed its 2014 revenue guidance of $335 million on May 1. Despite declining 3.9% the next day, shares gradually advanced to end the month up 11.2%. Becton, Dickinson also beat analysts’ consensus on May 1 and raised its fiscal 2014 adjusted EPS guidance by $0.03 to $6.22–$6.25. It also announced plans to repurchase roughly $450 million in stock during the fiscal year.

In contrast, a number of companies in the Index declined in May after reporting quarterly results. Fluidigm recorded the sharpest decline for the month, plunging 26.1%. On May 5, the company raised its 2014 organic revenue growth outlook by 450 basis points to 28%–32%, but lowered its expected revenue contribution from DVS Sciences (see IBO 1/31/14) by 38% to $20–$22 million. Shares fell 12.8% the next day. Transgenomic reported a wider-than-expected first quarter EPS loss on May 7, leading shares down 19.3% for the month. NanoString Technologies fell 8.2% this month, despite beating first quarter EPS estimates on May 7. Harvard Bioscience reaffirmed its 2014 outlook for flat revenue growth and adjusted EPS of $0.17 on May 1, yet shares contracted 2.4% for the month. Bio-Rad Laboratories fell 2.0% in May , as it missed first quarter EPS estimates on May 6.

Luminex was the only other company in the Index to decline in double digits in May. The company fell 11.6% for the month, as two insiders reduced their holdings by over 10%. In other news, Waters stated in an SEC filing on May 15 that it authorized a new $750 stock repurchase program and extended its previous repurchase plan, which had $221 million remaining. On May 20, Cepheid was upgraded by Needham from “Hold” to “Buy.”

Process/Metrology/Motion Instrumentation Stock Index

The Index climbed 2.2% in May to 736.53 but is down 4.6% year to date. Nanometrics had the highest return for the month, rising 5.5%, while Veeco Instruments slumped 9.9%. Veeco fell 7.4% on May 6 after it projected a second quarter adjusted EPS loss of $0.25–$0.33. On May 5, MTS Systems lowered its fiscal 2014 EPS by 6% to $3.35–$3.50 due to increased operating expenses and product mix. Shares slid 4.9% the next day but ended the month up 2.7%. On May 5, FEI was upgraded by Dougherty from “Hold” to “Buy” with a price target of $96 per share.

Lab Consumables/Equipment Stock Index

The Index grew 1.5% to 918.58 in May and is up 1.3% for the quarter. QIAGEN had the highest return for the month, climbing 4.8%. On May 6, the company reaffirmed its 2014 adjusted EPS outlook of $1.07–$1.09 and announced a new $100 million share repurchase program. QIAGEN was upgraded by HSBC on May 13 from “Underweight” to “Neutral.” Pall confirmed its fiscal 2014 pro forma adjusted EPS of $3.35–$3.45 on May 29. Shares were up 0.7% for May.

Cellular Dynamics lost the most value this month among Index firms, falling 5.5%, as it reported a wider-than-expected EPS loss on May 6. However, the company was upgraded by Leerink Swann on May 7 from “Market Perform” to “Outperform” with a price target of $17 per share.

Diversified Instrumentation Stock Index

With a gain of 3.9% in May, the Index is now up 1.9% year to date at 219.84. In May, all firms increased in value except Xylem, which slipped 0.8%. Danaher had the largest price increase, ascending 6.9% as both Citigroup and JPMorgan reiterated their positive ratings of the company.

Mettler-Toledo and Agilent Technologies recorded strong gains, rising 5.1% and 5.4%, respectively. On May 6, Mettler raised the lower end of its 2014 adjusted EPS range by $0.05 to $11.45–$11.60. However, its projected second quarter EPS of $2.50–$2.55 was slightly below consensus. On May 14, Agilent reaffirmed fiscal 2014 EPS of $2.96–$3.16, in line with consensus. However, projected fiscal third quarter EPS of $0.72–$0.74 was $0.06 below consensus. AMETEK traded slightly higher, as it increased its 2014 EPS outlook by $0.02 on May 6 to $2.32–$2.37. On May 9, the company raised its quarterly dividend by 50% to $0.09 a share.

International

Nearly all Asia Pacific equity markets traded higher in May, including 2.3% growth for the Nikkei 225. Despite these gains, prices for four of the seven Pacific Region companies declined, led by HORIBA and JEOL, which fell 4.3% and 9.5%, respectively. Despite a first quarter EPS decline of 9% on May 9 to ¥29.35 ($0.35), HORIBA maintained its full-year EPS outlook of ¥212.77 ($1.62). On May 13, Shimadzu posted a 28% rise in EPS to roughly ¥32.84 ($0.33) for the fiscal year ending March 31, yet shares slipped 0.2% for the month.

Precision System Science jumped 10.4% to lead all international firms in the stock table in spite of lowering its EPS outlook. It reported on May 15 a wider fiscal third quarter EPS loss of ¥14.15 ($0.14) and cut its fiscal 2014 EPS outlook by roughly 20% to ¥52.05 ($0.52). On May 13, Techcomp narrowed its first quarter EPS loss by 28% to $0.34. Even with all major European equity markets advancing in May, most UK-based companies in the IBO stock table declined. Horizon Discovery and Scientific Digital Imaging were the biggest decliners, falling 10.0% and 26.2%, respectively.

Prices for other European firms also wilted. Datacolor reported on May 5 that half-year EPS fell 19% to $13.23 due to investments in sales, marketing and R&D. On the same day, Exiqon reported first quarter EPS of DKK 0.02 ($0.00), compared to a loss of DKK0.12 ($0.02). It maintained its 2014 revenue and EBITDA outlook of DKK 150 million ($27 million) and DKK 5 million ($0.9 million), respectively. On May 15, Analytik Jena reported a fiscal second quarter EPS loss of €0.19 ($0.26), compared to a profit of €0.06 ($0.08).