To The Moon

After last week’s declines, the stock market on Monday (22 July) presented a rebound throughout the whole session. The mega-cap stocks and semiconductor stocks ditch their underperformance last week to lead the upside action.

The S&P 500 managed to close 1.1% higher and the Invesco S&P 500 Equal Weight ETF (RSP) settled 0.8% higher.

Significant gains from several popular and influential stocks like $NVIDIA Corp(NVDA)$ closed 4.7%, $Meta Platforms, Inc.(META)$ also up by 2.2% and Microsoft managed to gain 1.3%. Even with Monday’s upside action, in July till date, NVDA trade flat basically, META down by 3.3% and MSFT was lower by 0.9%.

Market participants are also digesting news that President Biden exited the 2024 presidential race and endorsed Kamala Harris for the candidacy. The news garnered muted responses in the equity and bond markets.

Information Technology Sector Regain Its Leadership

Nine of the 11 S&P 500 sectors logged gains. Information Technology sector led the pack with +1.96%, followed by Communication Services with +1.21% and Industrial and Real Estate both gained +1.07% and +0.98% respectively.

The largest decliner came from energy sector down by -0.72%because of falling oil prices dropping -0.3%.

Note Yield Was Higher

The 10-year note yield settled two basis points higher at 4.26%, and the 2-year note yield settled one basis point higher at 4.52%.

Tuesday’s Upcoming Earnings Before Market Open

Companies are reporting earnings before market open on Tuesday’s open include General Motors (GM), UPS (UPS), Lockheed Martin (LMT) and Coca-Cola (KO)

Stocks To Watch

SAP (SAP) shares rose 4.4% in extended-hours trading after the European software giant reported second-quarter results and guidance that were largely in-line with expectations. SAP earned an adjusted €1.10 per share, with revenue rising 9.8% year-over-year to €8.29B. Cloud revenue was €4.15B, and the current cloud backlog increased 28% to €14.8B. Analysts had expected $1.08 per share on $8.98B in revenue. SAP projects full-year cloud revenue between €17B and €17.3B, a 24% to 27% increase.

Google (GOOGL) updated its "Privacy Sandbox" approach, deciding to offer a user-choice prompt instead of removing third-party cookies from its Chrome browser. This initiative aims to balance user privacy with an ad-supported internet, receiving mixed feedback from various stakeholders.

$General Motors(GM)$ declared a $0.12/share quarterly dividend, maintaining its previous payout. The dividend is payable on 19 September to shareholders of record on 6 September.

There is a weak BUY signal appear from KDJ last Thursday (18 Jul), and we need to see more investors confidence on GM, hope that the dividend payout could gather some confidence back post earnings.

But it is worth to monitor the price action to find a potential trade, with the current price potential entry.

$SentinelOne, Inc(S)$ gained 8% following a Microsoft (MSFT) outage caused by a CrowdStrike (CRWD) update. Investors showed renewed interest in specialized cybersecurity vendors like SentinelOne, which offers advanced AI capabilities and comprehensive security features.

SentinelOne could be gaining market share as enterprises could be considering to change their cybersecurity solutions followed the outage by CRWD, or maybe enterprises could be building a redundancy with SentinelOne. Either way, this should be good news for the company and we should be looking at this stock closely.

SentinelOne has shown a nice BUY signal with MACD and KDJ making a potential upside on last Friday (19 July), with the global IT outage effect still lingering, we might see investors coming back with interest and confidence on this stock.

I would be watching this stock closely to look for an entry as the current price looks like a potential.

Summary

With the mega cap and semiconductor rebound to bring the market up, we need to be cautious on how things would develop moving forward, is the sector rotation broken?

Or that is just a temporary break from the rotation?

Appreciate if you could share your thoughts in the comment section whether you think we would continue to see upside action from Mag 6 and semiconductor stocks?

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.