15 July Market Solid Performance Driven By Financial Sector
Monday (15 July) the stock market gave a solid performance with DJIA leading by +0.5% to close at a new all-time high. The Russell 2000 continued its recent outperformance, jumping 1.8%, while the S&P 500 and NASDAQ gained 0.3% and 0.4%, respectively.
We have a 3-to-2 margin with advancers leading the decliners at both NYSE and NASDAQ.
S&P 500 Financial Sector Among Top Performer
There was upside bias on Monday (15 July) amidst the upcoming earnings news from the banking sector. Outperforming bank stocks like Goldman Sachs (GS) which was winning after they report the earnings on 15 July. The SPDR S&P Bank ETF (KBE) closed 2.7% higher, and the SPDR S&P Regional Banking ETF (KRE) jumped 2.9%.
The S&P 500 financial sector was one of the top performer closed with 1.42% higher, just after the energy sector which managed a 1.56% larger gain. The worst performer by wide margin came from the utilities sector losing 2.39%.
Positive Bias Related To Weekend Incident
Saturday’s assassination attempt on former President Trump has increased Trump chances of winning the election in November. This has helped in Monday’s positive bias. Generally market looked at Mr. Trump as candidate who is more market-friendly because of his aim of deregulation and lower corporate tax rates.
And on Monday (15 July), it is reported that former President Donald Trump has selected Ohio Senator J.D. Vance as his vice presidential running mate, which has significantly impacted shares in conservative-focused media platform Rumble (RUM).
Rumble stock jumped as much as 29% on the news. Vance, an investor in Rumble through his venture capital firm Narya Capital, has personally invested up to $300,000 in the platform, with his stake now potentially worth as much as $1.5 million.
More than 15.5 million RUM shares changed hands, 15.6 times its 3-month daily moving average. Stocks in Trump Media & Technology Group (DJT) also saw a rise of 32% by Monday's close.
Q2 Data Add To Fed Officials Confidence Inflation Falling
Fed Chair stated that the U.S. economy has performed remarkably well over the last couple of years. While the labor market is no longer tighter than it was at the end of 2019, there has been no additional confidence gained in the first quarter that inflation has come down.
However, Q2 data has added to the Fed officials' confidence that inflation is moving toward 2%, but Fed Chair refrained from signaling any specific policy actions.
Note Yield Settle Lower
With the belief that former President Trump is likely to win in November, we saw an early rise in market rates, but the note yield settled lower below their high yields.
The 10-year note yield settled four basis points higher to 4.224% after hitting 4.45%, and the 2-year note yield dropped one basis point to 4.455% after hitting 4.47%.
Stocks To Watch
Tesla CEO responded to queries about the timing of $Tesla Motors(TSLA)$ robotaxi event, he revealed that he has requested an important design change to the front of the robotaxi model, but there is no new data for the reveal mentioned which was previously scheduled on 08 August 2024.
Market analyst suggest that the delay could bring Tesla's embodied AI capabilities beyond app-based autonomous cars into more focus and investors might not looked at Tesla's Master Plan 4 yet.
Tesla is not able to hold above $260 despite hitting it briefly in yesterday’s trade, the 24-hours trading have Tesla around $255, as seen in the charts below, we can see that MACD is making a downwards movement towards a bearish crossover.
And KDJ is in a downside trend, with J value below, so we might need to be cautious if we are trading Tesla, it might take a while more for Tesla to go above $260 and stay above it.
Ford Motor Company (F) sold an estimated 15,645 Ford-150 Lightning vehicles in the first half of the year, while Tesla (TSLA) ranked second with 11,558 Cyber trucks sold.
Rivian (RIVN) reported 6,570 R1T sales, affected by a temporary manufacturing plant shutdown. The Cybertruck outsold the F-150 Lightning by 850 vehicles in the second quarter, becoming the best-selling vehicle priced over $100,000.
$Upstart Holdings, Inc.(UPST)$ saw its stock rise for the ninth straight session, closing 10.51% higher at $29.96. The stock has gained about 30% in value during this winning streak but has lost about 32.03% in the last 12 months. Upstart has a Sell rating from Seeking Alpha's Quant Ratings, with a score of 2.04 out of 5.
For the buying opportunities on UPST, there was 2 actually, one from MACD bullish crossover on 26 June 2024, and one more from the KDJ BUY signal on 08 July 2024. Currently, we are seeing an upside movement from MACD, but KDJ is showing that we might see selling signal.
We could be seeing some selling off or profit taking for UPST, if KDJ continue the move downwards to form a SELL signal.
Microsoft (MSFT), Alphabet (GOOG, GOOGL), Amazon (AMZN), $Palantir Technologies Inc.(PLTR)$ , and Meta Platforms (META) are expected to be standouts in the upcoming earnings season, according to Wedbush Securities. Analyst Dan Ives believes 2Q earnings will be a positive catalyst for the tech sector, driven by the "AI Revolution" and accelerated growth and earnings.
I would be focusing on Palantir earnings as I believe that the next AI revolution would be into the software part, Ai software platform provider would be the one that would standout if their platform offered a holistic range of services and products.
From the technical, we can see that there is a MACD bullish crossover forming in early July, and if we looked at KDJ, there is a potential BUY signal actually, so MACD is showing that Palantir is still making the upside move towards $29, but will it hit $30 before its next earning on 05 August 2024?
KDJ is showing consolidation and J value have not opened up, so I think the next few days might be something we should looked at, if Palantir can maintain a consistent upside movement, and a potential signal from KDJ towards the upside, then Palantir could have a chance towards $30.
Rivian Automotive (RIVN) snapped a six-session gain streak, closing 3.4% lower at $17.50. The stock had gained about 22.5% in the preceding six sessions. Despite this, Rivian has lost nearly 23% so far this year.
Summary
If we were to look at how market have moved yesterday (15 July), the tech rotation seem to continue and with the bank stocks earnings coming, there is also a shift towards the financial sectors.
But we also need to look at small caps or mid caps stocks so that we can have our strategy on defensive, not forgetting the energy sectors as well.
Appreciate if you could share your thoughts in the comment section whether you think tech sector rotation would continue and financial sectors could keep coming up because of bank stocks earnings.
@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.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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