20 Nov Stocks Rallied In Late Trading. DJIA Snap Four-Session Losing Streak

Major U.S. equities indexes were mixed and little changed on Wednesday as Nvidia (NVDA) prepared to disclose quarterly results after the closing bell.

After trading in negative territory for much of the day, stocks rallied in late trading Wednesday, putting the Dow Jones Industrial Average and S&P 500 into positive territory, as investors awaited the release of quarterly results from AI investor favorite Nvidia (NVDA).

S&P 500 rebounded in the afternoon to close flat for the session. The afternoon rally helped lift the Dow to a daily gain of 0.3% higher to snap a four-session losing streak, while the NASDAQ ended 0.1% lower.

The S&P 500 has now risen for three straight days, recovering some of the losses recorded last week as a big post-election rally fizzled.

S&P 500 HealthCare and Energy Up More Than 1%

S&P 500 Healthcare sector was up 1.18% cause of gains from highest weight stocks Eli Lilly (LLY) up 3.25% and UnitedHealth Group (UNH) up by 4.07%.

Energy sector was second with 1.00% gain with contributions from Exxon Mobil (XOM) up by 1.42% and Chevron Corp up by 1.08%.

Weakness in mega-cap stocks limited index performance throughout the session with some mega-cap technology stocks were mixed, as Microsoft (MSFT), Tesla (TSLA), Amazon (AMZN) and Alphabet (GOOGL) lost ground while Apple (AAPL) and Meta Platforms (META) inched higher.

The information technology though lost 0.09% was helped by wednesday's top performance in the S&P 500 came from shares of electronic test and measurement provider Keysight Technologies (KEYS), which surged 8.8% to a 52-week high. Keysight posted better-than-expected earnings per share (EPS) and revenue for its fiscal fourth quarter, boosted by its investments in artificial intelligence (AI) technology. Projections for the current quarter also topped forecasts.

Note Yield Higher

The yield on 10-year Treasurys, which has risen in recent weeks as investors have scaled back their expectations for the Federal Reserve to cut interest rates aggressively, was at 4.418%, up nine basis points from 4.38% yesterday.

The 2-year Treasurys was up three basis points at 4.334% from 4.289%. Initially, Treasury yields fell due to geopolitical concerns after reports that Ukraine fired UK-made missiles into Russia. However, safe-haven buying waned after Fed Governor Bowman suggested a cautious approach to lowering the policy rate, and a $16 billion 20-year bond auction showed weak demand.

Stocks To Watch

$Target(TGT)$ shares plummeted 21.4%, falling the most of any stock in the S&P 500 after the retail giant reported lower-than-expected sales and profits for the third quarter. Although digital sales ticked higher from a year ago, comparable store sales declined, and Target highlighted that inflation-wary consumers are taking a cautious approach to shopping and spending. Target's miss came a day after rival $Wal-Mart(WMT)$ topped quarterly expectations, helping lift Walmart shares to a record high.

Super Micro Computer (SMCI) shares fell 8.7%, giving back some of the gains posted in the previous session. The server maker's stock has carved a volatile path in recent weeks as Supermicro addresses concerns about its accounting practices that led to the postponement of its annual report. Earlier this week, the company submitted a plan to avoid the delisting of its stock from the Nasdaq and announced that accounting firm BDO USA would serve as its new auditor.

Semiconductor maker Qualcomm (QCOM) held its first investor day in three years, outlining growth projections for its business outside of smartphones, with a focus on the automotive and Internet of Things (IoT) segments. However, Qualcomm shares dropped 6.3% as analysts questioned the expected growth trajectory of the company's markets and its ability to capture market share. Qualcomm derives the majority of its revenue from smartphone chips and faces pressure to diversify as Apple (AAPL) moves away from Qualcomm components.

$NVIDIA Corp(NVDA)$ reported impressive Q3 results, with a Non-GAAP EPS of $0.81, exceeding expectations by $0.06. The company's revenue soared to $35.08 billion, marking a 93.6% increase year-over-year, and surpassed estimates by $1.95 billion. A significant highlight was the record quarterly Data Center revenue of $30.8 billion, reflecting a 17% rise from Q2 and a 112% increase from the previous year. CEO Jensen Huang emphasized the transformative impact of AI across industries and nations, as Nvidia's Hopper and Blackwell GPUs see unprecedented demand. The company projects Q4 revenue to reach $37.5 billion, slightly above consensus estimates.

But I think investors is expecting a much higher performance from the results that is why we saw NVDA drop more than 1.5% in after-hour tradings.

We are seeing that there have been an increase sell-off after the results, this might be short-term, but I am expecting some investors to take advantage to buy the dip later. So I am not so concerned about this 2% drop.

I am still holding onto my position of NVDA.

Shares of $MicroStrategy(MSTR)$ , one of the world's largest holders of bitcoin, rose 10% as the cryptocurrency hit another record high. MicroStrategy's stock price has nearly doubled since the start of the month.

For MSTR we are still seeing strong buying strength from the investors and this should continue as Bitcoin continue its path above $95,000 as it was nearing $95K temporarily.

Summary

The market might continued trading mixed on Thursday, as NVDA decline might affected some of the mega cap stocks, but we would need to monitor and see how the market open on the technology stocks.

As per my previous article, I am suspecting technology stocks rotating out, so let’s see what happen today (20 Nov).

Appreciate if you could share your thoughts in the comment section whether you think market would trade in a mixed mode with positive bias.

@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.