Indexes Hit By Late-Session Selling; Novo Nordisk, Fifth Third, APO In Focus | Stock Market Today

TL;DR

Indexes, particularly NASDAQ, face selling pressure and potential pullbacks after strong gains in 2023, while financial stocks like Fifth Third Bancorp and Apollo Global Management hold up well.

Transcript

good afternoon everyone it's Ali Corman kri here with a breakdown of the action for Thursday January 4th where we saw the indexes get hit by some late session selling Ken yeah we had blue chips outperforming for a good part of the session uh NASDAQ S&P really was wasn't didn't do much the whole session but yeah sellers came into the market uh take ... Read More

Key Insights

• 😀 The NASDAQ and S&P 500 face potential pullbacks after strong gains in 2023 and profit-taking.
• ❓ Financial stocks, such as Fifth Third Bancorp and Apollo Global Management, exhibit bullish technical action and resilience.
• 🤩 The 10-week moving average is a key support level to watch for the NASDAQ during a potential pullback.
• 🫰 The Russell 2000 and the NASDAQ Composite appear to be the most vulnerable indexes.
• 💪 The 10-year yield reaching 4% and strong economic data contribute to the selling pressure.
• 📶 Financial sector ETFs, like XLF and KR, show signs of strength and possible opportunities.
• 🥺 Health care stocks, reflected by ETF XLV and Novo Nordisk, have performed well and may lead the market.

Questions & Answers

Q: Why did the indexes experience selling pressure?

The indexes faced selling pressure after strong gains in 2023 and a lot of profit-taking and tax selling. Additionally, growth stocks and big winners in the software and semiconductor space may be undergoing some corrections.

Q: What would be an ideal scenario for the market during a pullback?

During a pullback, it would be ideal to see downside with limited expanding volume. Additionally, leading stocks need to start firming up, and a pullback that allows them to digest their gains would not be concerning.

Q: How did the major indexes perform during this session?

The NASDAQ was down nearly 0.6%, while the S&P 500 lost 0.3%. The Russell 2000 was slightly lower, and the Dow performed slightly better, but all indexes experienced selling pressure.

Q: What is the significance of the 10-week moving average for the NASDAQ?

The 10-week moving average, represented by the red line on the weekly chart, is a key support level for the NASDAQ. Holding above this line would reflect buyer support during a potential pullback.

Q: How did the S&P 500 perform in terms of support levels?

The S&P 500 held above its 21-day line, which provides short-term support. However, late-session selling and consecutive higher volume declines indicate vulnerability for the index.

Q: How did the Dow perform during this session?

The Dow held up relatively well compared to other indexes. It outperformed most days since the start of the year, with healthcare stocks like Merck and Amgen leading the Blue Chip index.

Q: Which indexes appear to be the most vulnerable currently?

The Russell 2000 and the NASDAQ Composite seem to be the most vulnerable indexes due to sharp declines. The Russell's 10-week moving average is far below its last breakout area, indicating weakness.

Q: How did the 10-year yield impact the selling pressure?

The 10-year yield reaching the 4% level, along with strong economic data on private payroll numbers, may have contributed to the selling pressure in the equity market. The Federal Reserve is keeping a close eye on these economic indicators.

Summary & Key Takeaways

• Major indexes, including NASDAQ and S&P 500, experienced selling pressure, potentially signaling a pullback after significant gains in 2023.

• Financial stocks, such as Fifth Third Bancorp and Apollo Global Management, showed resilience and performed well.

• The market saw consecutive down days, and the NASDAQ lost ground compared to its 21-day moving average, potentially indicating a pullback to the 50-day moving average.