The sea of red in the stock market continued into the final hour of trading Friday, as the major indexes were near session lows on the stock market today.
The Nasdaq was hardest hit with a 2.5% drop, while the S&P 500 fell 1.5%. Both sank below their 21-day exponential moving averages. The Dow Jones Industrial Average held up the best, with a still-significant loss of 0.8%.
Small caps also sold off, with the Russell 2000 falling 1.6% and testing the 21-day line.
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Volume rose on the New York Stock Exchange and fell on the Nasdaq compared with the same time on Thursday. Declining stocks outnumbered advancers by more than 2-to-1 on the NYSE and by nearly 3-to-1 on the Nasdaq.
Bloom Energy (BE) rocketed around 57% in enormous volume that caused a temporary trading halt Friday morning. Late Thursday, the fuel cell power maker announced it signed a deal with American Electric Power (AEP) to provide power to artificial-intelligence data centers.
American Electric Power rose 2.5% on the stock market today. Shares of the electricity provider are in the lower portion of a flat base with a 105.18 buy point. The stock is below its 50-day moving average. American Electric provides electricity to customers in 11 states.
IBD 50 name Argan (AGX) plummeted more than 8% in heavy volume and undercut its 21-day line. The stock is on track for its fourth straight day of losses after reaching a record high Monday. The stock has gained 189% so far this year, even with the recent pullback. Shares are far extended from its last base in March. Argan provides engineering, construction, project development and operations management services to power plants and solar facilities.
Despegar.com (DESP) surged more than 16% in heavy volume following the Latin American travel booking company’s better-than-expected third-quarter earnings and sales. The stock reached the 20% profit zone of a cup-with-handle base with a 13.66 buy point.
The Technology Select Sector SPDR (XLK) ETF tumbled 2.6% and Communications Services Select Sector SPDR (XLC) fell 2.2%. Those were the worst performing S&P sectors on the stock market today. Defensive sectors such as utilities and real estate were higher, and financials climbed 0.4%.
Meta Platforms (META) was down nearly 4% and broke below its 50-day moving average. Other Magnificent Seven stocks were down more than 1.5%, but Tesla (TSLA) climbed 2%.
Some high-rated tech stocks got hit with sell signals.
Arista Networks (ANET) slid below its 50-day moving average in active trading. The network equipment maker is back near its 376.50 buy point from the Sept. 19 breakout. That’s a round-trip sell signal for Arista, which had climbed as much as 15% from the entry.
Cloudflare (NET) fell nearly 4% and is now 8% below the 96.30 entry of last week’s breakout from a cup-with-handle base. That’s a sell signal. The Relative Strength Rating has fallen below 70, which is another reason for those who bought at the latest breakout to consider cutting losses short.
MakeMyTrip (MMYT) fell below its 50-day moving average, although volume was moderate. The stock is now more than 11% below the 110.49 buy point of the Nov. 6 breakout, which causes a sell signal.
Biotechs also got slammed. The SPDR S&P Biotech (XBI) exchange traded fund is down more than 6%, on pace for its worst drop since Feb. 13, when it fell 4.7%, according to Dow Jones Market Data. Its five-day losing streak is now the longest since April and worst five-day stretch since June 2022.
Halozyme Therapeutics (HALO) plummeted 14% in huge volume, breaking below the 200-day moving average one day after the stock pierced below the 50-day line. The biotech said it is bidding to acquire rival Evotec (EVO) in a deal valued at more than $2 billion. Shares of Germany-based Evotec climbed 8% to 5.50 a share.
Other health care industry groups were among the bottom 20 in Friday’s performance table, including hospitals, ethical drugs and medical software.
Sellers hit chip stocks again, weighed down by an earnings sell-off for Applied Materials (AMAT), which slumped more than 10%. The VanEck Semiconductor ETF (SMH) sold off nearly 7%. The ETF lost support at its 50-day moving average, a noteworthy chart development.
Applied Materials was one of the worst performers in the Nasdaq 100, along with Arm (ARM), which was down more than 5%. Nvidia (NVDA) fell 2% as it holds just above its 21-day exponential moving average. Nvidia reports earnings next week, with results due Wednesday after the close.
The S&P 500 tested its 21-day exponential moving average, a key short-term support level. Walt Disney (DIS) was a top gainer in the index, up another 3%, after gapping up Thursday on strong earnings.
Besides Walt Disney, JPMorgan Chase (JPM) also gained well in the Dow, up 1.5%. The financial giant is back near highs after gapping up earlier in the month of news of Donald Trump’s presidential win.
After hitting an intraday high of just over 4.5%, the 10-year yield backed off highs but still rallied four basis points to around 4.46%. October retail sales came in mixed, but September data was revised sharply higher. In other economic news, the November Empire State Manufacturing index came in much stronger than expected at 31.2, an indication of robust manufacturing activity in the Northeast region. The reading was -11.9 in October, indicating contraction.
The odds for another quarter-point interest rate cut at the Federal Reserve’s December meeting have dropped to 58.7% from about 85% a month ago.
Growth stocks came under more pressure in the MarketSurge Growth 250. United Therapeutics (UTHR) fell sharply for the second straight session. The biotech is now making a key test of its 50-day line. It erased gains of more than 10% from buy points at 366.08 and 377.03, causing a sell signal.
On the upside, Coinbase (COIN) snapped back after three straight declines. The cryptocurrency exchange operator rallied more than 3%, with bitcoin up more than 2% to around $89,700.
Sellers knocked the major stock indexes lower in early trade Friday, following through to the downside after some stock market selling Thursday. Big movers in the stock market today include Domino’s Pizza (DPZ), a new holding of Warren Buffett. Palantir (PLTR) also outperformed, up more than 2%, on news the company will move to the Nasdaq from the NYSE near the end of the month.
Tesla (TSLA) climbed nearly 2% after shares plunged nearly 6% Thursday. The downside catalyst was news that the Trump administration plans to do away with President Joe Biden’s electric-vehicle tax credit.
Domino’s backed off opening highs but still rallied 2%. It’s been a laggard performer in the restaurant group with a weak Relative Strength Rating of 58. According to the Wall Street Journal, Buffett’s stake in Domino’s was worth about $550 million at the end of September.
Buffett also started a position in Pool (POOL), another laggard. Shares jumped 3%. Pool operates hundreds of pool equipment and supply stores in the Americas, as well as Europe and South America. Berkshire Hathaway‘s (BRKB) Pool stake is even smaller than in Domino’s, at around $150 million.
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Buffett did more selling than buying in the third quarter. He cut his position in Ulta Beauty (ULTA), a relatively new position, while lowering his stakes in Capital One (COF) and Charter Communications (CHTR).
In the health care space, vaccine makers underperformed again after weak performances Thursday. Moderna (MRNA) and Novavax (NVAX) plunged more than 5% Thursday after Trump nominated Robert F. Kennedy Jr. to lead the Department of Health and Human Services. Pfizer (PFE), GSK (GSK) and AstraZeneca (AZN) also lagged.
Alibaba (BABA) pared premarket gains and reversed sharply lower as earnings topped expectations but revenue missed. The China-based e-commerce giant reported revenue of $32.7 billion, up 6% year over year, but that was below the FactSet consensus of $33.5 billion.
Despite the miss, the company cited “robust growth” in gross merchandise volume for its Taobao and Tmall Group businesses during Singles’ Day, a popular shopping holiday that’s widely seen as a barometer of consumer sentiment. The results marked the second straight quarter of accelerating top-line growth.
Follow Ken Shreve on X @IBD_KShreve for more stock market analysis and insight. And Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
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