What an epic tug-of-war on Friday. Investors had the best buy signal during the ten days of turmoil. When the dust settled, it was a much better session than the 0.05% increase in the S&P 500 indicated. Eight of the eleven sectors were higher, although the most influential, Communication Services and Technology, finished lower. But even within those sectors, buyers emerged too late to nibble.
S&P 500 Index | +0.05% | |
Communication Services XLC | -0.32% | |
Consumer Discretionary XLY | +0.15% | |
Consumer Staples XLP | +0.56% | |
Energy XLE | +0.09% | |
Financials XLF | +0.69% | |
Health Care XLV | +0.39% | |
Industrials XLI | +1.36% | |
Materials XLB | +1.28% | |
Real Estate XLRE | -0.34% | |
Technology XLK | -0.76% | |
Utilities XLU | +0.24% |
Sifting Through Rubble
Usually, I focus on names that have turned higher during the down sessions. However, the biggest tech losers on Friday are names that have been powered higher by strong fundamentals. These names are all worth watching for a trade, although a couple are delectable ‘buy and hold’ candidates:
Company | Price | Down Friday | % |
CRM) Salesforce.com | 247.8 | -4.7 | -1.90% |
(FISV) Fiserv Inc. | 95 | -1.94 | -2.04% |
(PYPL) PayPal Holdings Inc. | 190.09 | -6.09 | -3.20% |
(AMD) Advanced Micro Devices | 78.98 | -2.64 | -3.34% |
(PAYC) Paycom Software Inc. | 275.49 | -10 | -3.63% |
(NLOK) NortonLifeLock Inc. | 22.47 | -1.34 | -5.96% |
Portfolio Approach
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Today’s Session
Equity futures have been higher all morning as a confluence of events, including more optimism over Covid19 vaccine being ready as soon as late October and a series of mergers.
Hopes increased when the CEO of Pfizer (PFE) told a Sunday morning talk show a vaccine could be ready by late October. In addition, AstraZeneca (AZN) announced resumption of its own vaccine testing, which was halted when a single patient became ill.
Monday mergers are back in a big way with Nvidia (NVDA) announcing it will purchase Arm Holdings from Softbank for $40.0 billion. This would be a monster deal that galvanizes the company as the number one player in the semiconductor space.
Gilead (GILD) paying up big time to buy Immunomedics (IMMU) for $21.0 billion. There is also some kind of deal brewing with Oracle becoming a partner with TikTok, which might fall short of the executive order from the White House. There will be a review using CIFIUS parameters to assess national security concerns.
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