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The market remains concerned about the alarming rise in coronavirus cases heading into winter, but the major indices managed to recover from early losses on Thursday and snap its two-day slide.
Investors are inching back into tech for safety as parts of the country (including New York City and Chicago) increase restrictions amid rising infections.
As a result, the NASDAQ had the best performance on Thursday by rising 0.87% (or about 103 points) to 11,904.71. The index goes into Friday’s session with a gain of about 0.6% for the week.
The S&P was up 0.39% to 3581.87, while the Dow bounced back from a 200-point loss to rise 0.15% (or nearly 45 points) to 29,483.23.
These indices have been sluggish since reaching all-time highs on Monday. They go into Friday at about breakeven for the week with the Dow up approximately 3 points and the S&P down around 3 points.
We received good vaccine news on Thursday from AstraZeneca (NASDAQ:AZN), which follows strong data from Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA) of late. However, the market has digested such news and now seems more concerned about increased restrictions and shutdowns.
So it’s a good thing that Senators McConnell and Schumer are reportedly going to resume talks for a stimulus package. Hey... better late than never. Investors certainly appreciated the news.
On the down side, jobless claims came in at 742,000 for last week. The result was more than the previous reading’s 709K and snapped four straight weeks of better-than-expected results.
Well, it doesn’t look like the indices will repeat the epic gains of the previous two weeks. However, there’s still a good chance they can finish in the green on Friday and keep November’s epic advance going as we approach the Thanksgiving holiday.
Let’s see what happens tomorrow...
Today's Portfolio Highlights:
TAZR Trader: Things are looking good for Shopify (NYSE:SHOP) after a nice upgrade and a new partnership, but Kevin doesn’t want to chase this established name at these prices. Fortunately, there’s a “lil Shopify” out there that’s only been public for a few months and has dipped near all-time lows after the initial IPO mania. BigCommerce (BIGC) provides a software-as-a-service e-commerce platform and recently reported a solid quarter. And today, it was given a Buy rating by a major brokerage. Best of all, it trades much cheaper than SHOP. The editor added BIGC on Thursday with a 7% allocation. But that’s not all..
The portfolio also picked up a 7.5% allocation in payment processor Square (SQ). Simply put, estimates for the company continue to rise though its stock remains a bargain at under 10X sales. It’s poised to grow another 35% to $12 billion next year, so it will still be doing well even after the pandemic is (hopefully) behind us. The service would look to buy more if the stock slips below $170. Kevin offers a lot of behind-the-scenes info on both of these buys today, so make sure to read his complete commentary for more.
Technology Innovators: The strong NVIDIA (NASDAQ:NVDA) report has Brian looking at the chip names again. On Thursday, the editor added Ichor Holdings (NASDAQ:ICHR), which is focused on critical fluid delivery subsystems for semiconductor capital equipment. The company has beaten the Zacks Consensus Estimate in the past two quarters, while rising earnings estimates have given the stock Zacks Rank #2 (Buy) status. The editor also likes its valuation. “This stock looks like it is going to be drifting higher and I want in on that,” he said. Read the complete commentary for Brian’s full analysis on this new buy.
Counterstrike: "Early pressure in the indices was bought up rather quickly, stopping any thoughts that the COVID headlines are some disaster like they were in March. The 3550-60 area was my level that needed to be defended and it was. The markets flipped from red to green.
"The reason I was looking for support in that S&P 3550 area was it was the 61.8% drawn from last weeks lows to Mondays highs. This retracement usually finds buyers if they are around, so I consider it rather bullish we saw a defense of that level. Back over 3600 would confirm this view and I think bears would be on a run to 3650.
"On the COVID front, not much has changed. We continue to see cases rise, but at some point, they will stop. I did see that the Europe cases ticked down a bit, so perhaps in another month we see some improvement as the vaccines are rolled out." -- Jeremy Mullin, who had a top performer today as Zebra Technologies (ZBRA) rose 6.16%.
All the Best,
Jim Giaquinto
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