To The Moon

Trading session on 29 May saw a negative bias with broad selling activity keeping major indices in the red throughout the day. Indices closed near their session lows as increased selling in heavily-weighted stocks limited index-level losses.

Tech stocks like Amazon.com (AMZN) fell 0.1% to $182.02, Microsoft (MSFT) dropped 0.3% to $429.17, and Alphabet (GOOG) declined 0.4% to $177.40. Amazon was up as much as 1.1%, MSFT was up 0.11% at its high, and GOOG showed a 0.14% gain at its peak.

S&P 500 Sectors Ended With Losses

All 11 S&P 500 sectors ended the day with losses. The energy sector was among the top laggards, falling 1.76% due to declining commodity prices.

The industrial sector also struggled, dropping 1.42%, largely due to weak airline stocks. American Airlines (AAL) fell 13.5% to $11.62 after lowering its Q2 EPS below consensus and reducing its adjusted operating margin and TRASM guidance.

WTI crude oil futures dropped 0.8% to $79.17/bbl, and natural gas futures slid 5.7% to $2.66/mmbtu. Marathon Oil (MRO) bucked the trend, surging 8.4% to $28.68 after ConocoPhillips (COP) announced it would acquire MRO in an all-stock transaction. COP fell 3.1% to $115.25.

Treasury Yield Contribute to Equities Downside

As part of a normal consolidation after a recent strong run, the losses experienced on 29 May was expected. Despite the decline, the S&P 500 is still up 4.6% this month, and the Nasdaq Composite has gained 8.1% since the start of May.

The downside in equities also came from the contribution of the treasury yields. The 10-yr note yield rose eight basis points to 4.62%, while the 2-yr note yield remained unchanged at 4.985%. Yields were already moving higher, but weak demand for a $44 billion 7-yr Treasury note sale spurred increased selling.

Economic Data No Significant Impact To Market

We saw the weekly MBA Mortgage Applications Index, which declined 5.7%, with refinance applications plunging 14% and purchase applications dropping 1%. The Fed's latest Beige Book indicated that national economic activity continued to expand from early April to mid-May, but it did not significantly impact bonds or equities.

Stocks To Watch On 30 May 2024

Salesforce (CRM) shares plunged nearly 11% in extended-hours trading on Wednesday after the enterprise software giant reported fiscal first-quarter results and guidance that missed estimates. Salesforce earned an adjusted $2.44 per share on $9.13B in revenue, slightly missing analysts' expectations of $2.37 per share on $9.15B in revenue. The company forecasted second-quarter earnings below expectations, contributing to the decline in share price.

$C3.ai, Inc.(AI)$ shares surged nearly 13% in extended-hours trading following the release of fiscal fourth-quarter results that exceeded expectations. The company reported revenue of $86.6M, surpassing the $85.9M estimate, and provided strong guidance for fiscal 2025, expecting revenue between $370M and $395M, above the $367.7M estimate. CEO Thomas Siebel highlighted the increasing demand for Enterprise AI and the company's market position.

You might want to check out my previous article on why we should look at C3.ai long term because of its ability for consistent revenue growth

Why We Should Not Overlook C3.ai Rapid and Consistent Revenue Growth

$Apple(AAPL)$ is seeking a senior engineer to develop a television and sports app for Android, according to a recent job listing. This move could indicate Apple's intention to expand its TV+ service to the rival Android platform, aiming to capture a larger share of the video streaming market. The expansion could help Apple compete more effectively with other streaming giants like Netflix and Disney.

I personally feel that this is a good move by Apple to move to get into end consumer market. This is the time when AI has started to look at how it can be run on end user computing devices. With this move, I believe we could be seeing more AI-centric service from Apple on its TV+ service.

With this new approach, are we going to see Apple making a move to its upside, based on the KDJ chart, it look like there is a potential of an upside move of the J value, but we need to see how the market sentiment is like for this news.

$Okta Inc.(OKTA)$ shares snapped six straight sessions of losses, closing 0.2% higher at $96.4 on Wednesday. The cybersecurity firm reported Q1 Non-GAAP EPS of $0.65, beating estimates by $0.10, and revenue of $617M, surpassing expectations by $12.54M. The company also provided a positive outlook for Q2 and fiscal 2025, expecting continued growth in revenue and operating income.

As mentioned in my previous article on its earnings, Okta Investors Uncertainty Need To Address. Focus On Yearly Outlook. They have provided a good future outlook, this has gathered good sentiment from the market.

This is going to help Okta to stay in the positive sessions moving forward. As seen in the chart below, we should be seeing Okta making an upside move after its earnings, and they should be creating a pretty good movement and stay in the positive side for a while.

Summary

Even though we saw broad seling in the market on 29 May, I viewed it as part of a process of normal consolidation after a recent strong run, we might want to take this opportunities to look for deals where we could buy at the dip.

And there have been some good earnings upside by C3.ai and Okta, both companies are involved in providing complementary services to the AI, and this is important as AI continues to mature to serve the end user consumers.

Appreciate if you could share your thoughts in the comment section whether you think consolidation would continue today?

@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.