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ETFsector.com Daily Trading Outlook, November 12, 2024

Patrick Torbert

Editor | Chief Strategist

Patrick Torbert is a veteran financial market analyst who is currently the Editor and Chief at ETF Insight a NY based full-service content, TV, video podcast and digital marketing firm that represents several ETF issuers. Patrick brings 20+ years of experience from Fidelity Asset Management where he most recently served as an equity and multi-asset analyst.

S&P futures are down 0.2% in Tuesday morning trading after U.S. equities closed mostly higher on Monday, with the S&P marking its 51st all-time high this year. Bitcoin-related stocks, meme names, and banks led gains, while big tech lagged, although TSLA rallied past the $1 trillion mark. Treasuries are under pressure as cash trading resumes, the dollar index is up 0.3%, gold is down 0.7%, Bitcoin futures are down 0.5%, and WTI crude is up 0.8%.

Momentum is slightly fading post-election, with bond yields rising and concerns about a potentially hot CPI report on Wednesday. Focus also on reports that Trump may appoint China hawks to key national security positions. Asian markets pulled back, especially Hong Kong, amid disappointment over limited China stimulus and weaker economic data.

In economic updates, NFIB small business sentiment rose to 93.7 in October, though uncertainty remains high. The Fed’s Senior Loan Officer Survey is due this afternoon, and multiple Fed officials are scheduled to speak.

In corporate news, Home Depot (HD) reported a Q3 beat and raised FY24 guidance slightly, Amazon’s (AMZN) Annapurna Labs is increasing AI chip production, Cardinal Health (CAH) announced $3.9B in acquisitions, Robinhood (HOOD) posted stronger-than-expected October metrics, Live Nation (LYV) reported record Q3 AOI driven by concerts, and IAC (IAC) beat EBITDA estimates and is considering restructuring moves, including a spinoff of its ANGI stake and financial breakout for Care.com.

U.S. equities closed higher on Monday in a relatively quiet trading session. The S&P 500 hit a new record above 6000, with the Dow and Nasdaq also reaching all-time highs. The Russell 2000 extended last week’s strong performance. Outperformers included sectors tied to “Trump trades” such as GSEs, insurance, trucking, banks, and oil services. Big tech was mostly lower, though Tesla stood out with nearly 40% gains month-to-date. Underperformers included semiconductors, oil majors, pharma, biotech, and select consumer sectors. The dollar index rose 0.5%, gold fell 2.9%, Bitcoin surged 13.4%, and WTI crude dropped 3.3%.

Looking forward, economic data this week includes NFIB small business sentiment and the Fed’s Senior Loan Officer Survey on Tuesday, October CPI on Wednesday, PPI on Thursday, and retail sales on Friday. Powell’s comments on Thursday and the FOMC Financial Stability report on Friday will also be closely monitored.

GICS Sector Summary:

Information Technology

  • monday.com (MNDY): Fell 15.1% despite a Q3 beat, as Q4 revenue guidance was slightly below expectations, and Chief Revenue Officer Yoni Osherov announced his departure.
  • Fortinet (FTNT): Gained 5.6% after HSBC upgraded the stock to buy, citing confidence in Q4 guidance and an improving long-term growth outlook.
  • Monolithic Power Systems (MPWR): Dropped 15.0% after reports from Edgewater Research suggested product performance issues could risk losing Nvidia’s Blackwell business.
  • Taiwan Semiconductor (TSM): Fell 3.6% after a U.S. directive ordered the company to stop shipping AI chips to China.

Health Care

  • AbbVie (ABBV): Declined 12.6% following disappointing Phase 2 trial results for Emraclidine in treating schizophrenia, which missed its primary endpoint.
  • Cigna (CI): Rose 7.3% after reaffirming FY24/FY25 EPS guidance, confirming it is not pursuing a merger with Humana, and announcing plans to use proceeds from a Medicare business sale for buybacks.
  • Dynavax Technologies (DVAX): Increased 5.0% after announcing a $100M accelerated share buyback program, expected to be completed by Q1 2025

Communication Services

  • Pinterest (PINS): Increased 4.2% after an upgrade from Wedbush to outperform, citing overdone Q3 reaction and potential growth from Amazon and Google partnerships.

Consumer Discretionary

  • Bloomin’ Brands (BLMN): Dropped 9.2% after a downgrade to market perform by Raymond James, citing underwhelming results from its Brazil division refranchise and concerns about potential dividend adjustments.

Financials

  • RadNet (RDNT): Gained 19.1% after a strong Q3 performance and raised guidance for its Image Center Segment. The company also announced an AI imaging partnership with GE Healthcare.
  • Block, Inc. (SQ): Rose 11.9% following an upgrade from Piper Sandler to overweight, highlighting potential growth from the secular shift to electronic payments

 

Eco Data Releases | Tuesday November 12th, 2024

 

 

S&P 500 Constituent Earnings Announcements | Tuesday November 12th, 2024

 

 

Data sourced from FactSet Research Systems Inc.

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