Next Day Prep: Tech Giants Tumble Semiconductor Shockwaves
A quick analysis of today’s market outlook and key trading opportunities to start your day.
Intro & Market Mood
Today’s market saw a tale of two halves – strong start with record highs, followed by a swift reversal giving back gains. While semiconductor stocks started strong, a single negative headline changed the game, leading to a risk-off rotation into defensive sectors. The pullback was moderate, indicating a pause rather than panic.
Overnight Headlines
Key stories included challenges for Oracle in renting NVIDIA chips impacting the semiconductor sector, disappointment in Tesla’s new Model Y, and a fire at a supplier affecting Ford. Notably, a major firm downgraded the homebuilders sector, except for James Hardie (JHX) which showed robust performance.
Economic Announcements
No significant economic announcements for tomorrow.
Earnings Highlights
- AMD: Upgraded to Buy with a $300 target by Jefferies, reflecting optimism in AI and AMD’s partnerships.
- Dollar Tree (DLTR): Downgraded to Underperform, signaling concerns for the low-end consumer market.
Top Movers
Healthcare and biotech sectors exhibited strength amidst the broader market pullback. Watch for potential continuation plays in stocks like Insmed (INSM), VTYX, and Accenture (ACN). For higher risk appetite, consider GSIW with caution.
Quick Trade Ideas
- INSM: Look for a pullback to $161 support then a breakout above $162.50 for a move towards $166.
- VTYX: Showed a strong close for potential follow-through.
- ACN: Slow and steady grind higher, a hold above $251 could lead to a measured move towards $253.
- GSIW: High-risk play, watch for a hold above 20 cents and a potential explosive move.
Key Takeaway
Cautiously optimistic but highly selective. Focus on relative strength in biotech and quality tech names. Watch INSM and ACN, knowing your support and resistance levels. In SPY, monitor 668 as support and 670 as resistance for market tone.