Next Day Prep: Tech Sinks, Defensive Rotation Rises
A quick analysis of today’s market outlook and key trading opportunities to start your day.
Intro & Market Mood
Welcome to Next Day Prep – What We Are Watching Tomorrow. August closed strong for the bulls, but Friday’s market felt a bit fatigued, primarily due to tech underperformance.
Overnight Headlines
- Tech mega-caps, especially in semiconductors, saw downward pressure, with companies like NVDA (NVIDIA) down over 3%.
- Marvell faced a significant drop of almost 19% due to guidance concerns and delays in big chip deals.
Economic Announcements
The PCE inflation report remained steady with core PCE at 2.9% year-over-year, in line with expectations, reinforcing an 87% chance of a rate cut in September.
Earnings Highlights
- Ulta Beauty, Affirm, and Autodesk reported strong performances amidst a mixed earnings landscape.
- Dell exceeded expectations but saw a drop of almost 9%, reflecting high market expectations in a hot sector.
Top Movers
- HYMC in precious metals and SYK (Stryker) in healthcare showed notable strength for potential trading opportunities.
- Watchlist stocks like LTRX and TMC (The Metals Company) are poised for potential breakouts.
Quick Trade Ideas
Consider entries in HYMC around $4.50 and SYK around $391 for potential moves. Watch for breakouts in LTRX and TMC for potential price runs.
Key Takeaway
Remain cautiously optimistic amidst short-term fluctuations. Focus on stocks with relative strength and key index levels. Look for volume to return after the holiday weekend.