Market Recap 2/12/24

extremw bull o meter
The contrarians are watching that space needle very closely.  BofA’s bull/bear indicator “nailed” the big buy in October. We are still not in sell red territory, but another big jump over the past week brings us closer to the contrarian sell. Just need a few more bears to throw in the towel…

Dow +125.69 at 38797.38, Nasdaq -48.12 at 15942.55, S&P -4.77 at 5021.84

 

It was a strong day for the stock market. Many stocks finished higher as evidenced by the positive bias in market breadth. Advancers led decliners by a 7-to-2 margin at the NYSE and by a 2-to-1 margin at the Nasdaq. The Dow Jones Industrial Average saw a 0.3% gain, marking another record closing high, while the Russell 2000 jumped 1.8%, continuing its recent outperformance. With today’s gain, the Russell 2000 is now positive on the year with a 0.9% gain.

Meanwhile, some mega cap stocks succumbed to profit-taking activity, weighing down the S&P 500 (-0.1%) and Nasdaq Composite (-0.3%).

The S&P 500 and Nasdaq Composite had been trading higher earlier, up as much as 0.4% and 0.6%, respectively. The indices started to decline around mid-day, though, as selling interest picked up in some overbought constituents.

Amazon.com (AMZN 172.34, -2.11, -1.2%) and Microsoft (MSFT 415.26, -5.29, -1.3%) were among the influential losers from the mega-cap space, dropping more than 1.0% today. AMZN and MSFT are still up 13.4% and 10.4%, respectively, for the year.

Notably, some of the largest gainers to this point in the year from the mega-cap space still finished higher today. Specifically, Meta Platforms (META 468.90, +0.79, +0.2%) and NVIDIA (NVDA 722.48, +1.15, +0.2%) closed in the green, bringing their 2024 gains to 32.5% and 46.3%, respectively.

META and NVDA fell from their session highs, however, as their mega-cap peers extended early losses or rolled over from early gains. META had been up as much as 2.4% today and NVDA had been up as much as 3.4%.

Semiconductor stocks also rolled over from early strength, adding downside pressure to the major indices. The PHLX Semiconductor Index (SOX) had been up as much as 1.7% at its high but closed with a 0.2% loss.

The rollover action seen today was related to the market’s growing sense that things are due for a pullback.

PTGX triggered today (Weekend Market Report),  and I added ONON and TWST as new longs.

Be careful up here as we have come far and fast and a lot of names are extended. Check the P&L tonight to see where I have raised stops.

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