Commenting on IBM, Intel, and Schlumberger’s post earnings plunge and today’s trading so far, Gorilla Trades strategist Ken Berman said:
The major indices are all trading lower at midday following a clearly bearish overnight session and a brief morning bounce on Wall Street. The much better-than-expected Markit manufacturing and services PMIs gave a nice boost to U.S. stocks, despite the rumors of a border lockdown in the European Union, which have been weighing on risk assets and the energy sector, in particular. The doubts regarding President Biden’s stimulus proposal put pressure on cyclical issues, as investors bet on a smaller package compared to the President’s $1.9 trillion plan.
The ExodusPoint Partners International Fund returned 0.36% for May, bringing its year-to-date return to 3.31% in a year that's been particularly challenging for most hedge funds, pushing many into the red. Macroeconomic factors continued to weigh on the market, resulting in significant intra-month volatility for May, although risk assets generally ended the month flat. Macro Read More
IBM, Intel, And Schlumberger Plunge
Intel (INTC, -8.5%) opened sharply lower after publishing strong quarterly numbers yesterday in after-hours trading, with IBM (IBM, -10.6%) and Schlumberger (SLB, -1%) also plunging, post-earnings. Despite the losses, the tech sector and the Nasdaq have once again been performing better than the broader market, with the likes of Microsoft (+2%) and Facebook (FB, +1.2%) supporting the benchmark. On a negative note, small-caps have been showing weakness again, and the Russell 2000 might even close the week in the red for the first time in 10 weeks.
Dow: 30,971, - 205 or 0.7%
S&P 500: 3,840 - 13 or 0.3%
Nasdaq: 13,503, - 28 or 0.2%
Russell 2000: 2,127, - 14 or 0.6%
Market breadth has been relatively weak this morning, with decliners outnumbering advancing issues by a more than 3-to-1 ratio on the NYSE at midday. Only 2 stocks hit new 52-week lows on the NYSE and the Nasdaq, while 83 stocks hit new 52-week highs. The major indices have been hovering around their daily VWAPs (Volume-Weighted Average Price) throughout the morning session, pointing to a mixed and choppy afternoon. Energy stocks and materials have been hit hard in early trading following yesterday’s slump, with financials and industrials also struggling despite the bullish services PMIs, with only the defensive healthcare and utilities sectors and tech stocks outperforming the large-cap benchmarks. Stay tuned!