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Markets are pulling back this morning led by the generals and semiconductors. The Nasdaq is not holding the 20-day moving average this morning with most of the MAG 7 names down between one and three percent (except Tesla) and semiconductors under pressure. There was no specific catalyst on the economic front that resulted in this move as it appears technical in nature once intraday support levels gave out. We will discuss the technical backdrop of all the markets in depth in the Tackle Today video and in the Tackle Trading Newsletter released later today.
Health care and biotech stocks are also under noticeable pressure after Robert F. Kennedy Jr. was nominated to be Secretary of Health and Human Services (HHS). The markets hate uncertainty more than anything else and his role and promise to shake up different aspects of the health care industry have markets in a sell first/ask questions later mentality this morning. We will provide a full sector breakdown in the Newsletter later today.
Stocks in the News
- General Motors (GM): Laid off roughly 1,000 employees, mainly at its Michigan technical center, as part of a $2 billion cost-cutting effort amid slowing U.S. sales and weaker demand for EVs. Shares edged lower following the announcement.
- Applied Materials (AMAT): Reported earnings of $2.32 per share, beating estimates by 4.50%, on revenue of $7.05 billion, up 4.79% YoY. Issued mixed guidance for Q1, leading to a sell-off despite the beats.
- Alibaba Group Holding (BABA): Reported earnings of $1.93 per share, missing estimates by 10.65%, on revenue of $33.70 billion, up 9.38% YoY. Shares rose as net income jumped 58% YoY, supported by strong equity investment performance.
- Domino’s Pizza (DPZ): Shares climbed after Berkshire Hathaway disclosed a new position in the pizza chain, acquiring over 1.2 million shares valued at approximately $550 million as of the end of September.
- Pool Corp. (POOL): The stock moved higher following Berkshire Hathaway’s purchase of around 404,000 shares in the swimming pool supplier, worth $152 million by the close of the last quarter.
- Ulta Beauty (ULTA): Shares declined after Berkshire Hathaway announced it had nearly exited its position in the beauty retailer, selling roughly 97% of its holdings. Ulta had only recently been added to Berkshire’s portfolio in the second quarter.
- Palantir (PLTR): The stock advanced as the company announced plans to transfer its listing to the Nasdaq Global Select Market, aiming for potential inclusion in the Nasdaq-100 Index.
Economic Reports
There were several economic reports this morning with generally mixed results.
- Core Retail Sales M/M: 0.1% versus 0.3% exp
- Retail Sales M/M: 0.4% versus 0.3% exp
- Industrial Production: -0.3% versus -0.3% exp
Not a lot to change storylines here and the economic reports this morning are not the cause of the volatility.
Next 24 Hours
There are no major economic reports or earnings results that will be released before the market open on Monday. We will be releasing the Tackle Trading Newsletter later today and the Trading Justice podcast tomorrow with detailed market analysis.
Have a fantastic weekend!
S&P Biotech (XBI)
Markets hate uncertainty and when it truly strikes it can create some nasty candles. That is what is occurring on biotech and spilling over to healthcare in general today after Robert F. Kennedy Jr. was nominated to be Secretary of Health and Human Services (HHS). Naturally these areas of the market become stay aways until significant pattern development occurs which can take some time.
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