ECONOMIC SILUET: Watch these roaring chip stocks, On Holding and these retail giants in tomorrow’s trading

Rabu, 17 Mei 2023

WED, MAY 17, 2023

Tomorrow's Top CNBC Stories Tonight

New Relic's late-day surge

New Relic jumped 10% in the final minutes of trading as The Wall Street Journal reported that the software company is in talks to be sold to buyout firms Francisco Partners and TPG. The report indicates the deal would worth over $5 billion. New Relic finished the session with a market cap of just under $5.8 billion. It's been a relatively strong performer so far this year, up nearly 50%, though it's still down around 35% from its 2021 all-time high.

Best day since 2017 for Bausch Health

Bausch Health had its best day since May 2017 after a judge ruled against a competitor's rival drug. The stock has been under pressure in recent months, down over 20% in the past three months including today's move. The Invesco Dynamic Pharmaceuticals ETF (PJP) is down just 3% in the same time.

A rough week for On Holding

On Holding fell another 7% today after William Blair downgraded the stock to sell from hold. That seemed to outweigh Morgan Stanley and UBS reiterating buy ratings and raising their price targets. Some of the pessimism around the stock this week is tied to a slowing forecast after the shoe company has seen meteoric growth in the past year or so. The stock is heading for its worst week since June 2022, but it's still up over 60% in 2023.

Chip stocks' big week

A strong week for chips, with Universal Display up 11% so far. The giants are also doing well: Taiwan Semi is on pace for its best week since January. Nvidia is tracking for its best since March, and AMD is heading for its fourth-straight weekly gain and best since March. Nvidia, Lam Research, Applied Materials and Broadcom all hit 52-week highs in today's trading. Intel was the holdout today and for the week; shares were down over 1% today and are slightly negative week to date. The VanEck Semiconductor ETF (SMH) is trading at its highest level since early April and on pace for its best week since January.

Energy stocks

David Kostin on CNBC TV this morning said he thinks energy stocks are cheaper than they've been in 30 years.
The S&P Energy sector is the worst performing sector in the index this year. It's down 10.5% in 2023.
Only EQT, which is up nearly 3% in 2023, and Coterra, which is up 0.3%, are positive.
The bottom three stocks are APA, down 30% year to date and Halliburton down 26.5%. Devon Energy down 22.4% year to date.
Chevron is down 13% in 2023, and Exxon Mobil is down about 5% in 2023.
As of today the Energy Select Sector SPDR Fund (XLE) pays a dividend of 4.23%.
Chevron pays a 3.9% dividend and Exxon Mobil pays 3.5%.

Credit

Great lead on "Fast Money" tonight at 5 p.m. ET, reporting on three possible signs of trouble as the S&P 500 and Dow Jones Industrial Average are about 4% from a 52-week high. The Nasdaq is 5% away.
Anchor Melissa Lee reported that small private companies' defaults are up. Companies that have defaulted once are doing so again at their highest levels since 2009, and lending standards are near historic highs.
Credit default swaps, essentially insurance for the interest paid on bonds, are up 1,000% in 2023 on the 1-year bond. Credit default rates on a five year have doubled in three months.

Tech

CNBC's data team guru Gina Francolla points out the Technology Select Sector SPDR Fund (XLK), which tracks the S&P Technology sector, hit a third straight 52-week high today.
The XLK is now up 24% in 2023 making it the second best performing sector behind communications services, based on the Communication Services Select Sector SPDR Fund (XLC).
The XLC is led by Meta, Alphabet and Warner Bros.
The XLK is led by Nvidia, which is up 106.5% in 2023 and AMD, up 60% in 2023. Salesforce is up 58% in 2023.
IBM, Hewlett Packard Enterprise and Juniper are at the bottom of the list, all down at least 10%.

Big-cap tech's big rally

Bob Pisani will report Thursday on the debate for investors who've brought in big gains, to consider moving to an equal weight index.
Microsoft is up 31% in 2023, hitting a new 52-week high today.
Salesforce is up 58% in 2023, hitting a new 52-week high today.
Broadcom is up 17.6% in 2023, 1% from a 52-week high.
Meta is up 101% in 2023, hitting a new 52-week high.
Oracle is up 22% in 2023, hitting a new 52-week high.
Lam Research is up 36% in 2023, hitting a new 52-week high.
Applied Materials, which reports results tomorrow, is up 29% in 2023, hitting a 52-week high.
Alphabet is up 37% in 2023, and it's 1.3% from a 52-week high.
The First Trust NASDAQ-100 Equal Weighted Index Fund (QQEW) is 3.3% from a 52-week high, up 11.6% in 2023.
The Invesco S&P 500 Equal Weight ETF (RSP) is 9% from the 52-week high and pretty flat year to date.
The First Trust Dow 30 Equal Weight ETF (EDOW) is 3% from a 52-week high and up about 2% in 2023.

Retail

Home Depot and Target reported this week. Next up is Walmart on Thursday morning.
Walmart is down 2.3% in three days, while Home Depot is up slightly and Target is up roughly 2%.
Year to date, Walmart is up 5.5%. In 2023, Home Depot is down 7%, and Target is up 8%.