Closing Recap

Friday, November 24, 2023

Thanksgiving food coma for the markets persisted overnight as the pre-market metrics were split between Nasdaq red and S&P green, but both flattish. Or maybe all the traders are at the malls in line for black Friday deals…either way, a quiet start for the half-day session. Early breadth had advancers over decliners by almost 2:1, though the indices remained sluggish as several big tech names were in the red: MSFT, AMZN, META, APPL, NVDA, GOOGL. Energy, Materials and Health Care led sector ETF gainers early, while Real Estate, Utilities, Communications and Technology were laggards all with modest declines. Consistent with the big tech declines, small caps were early outperformers with the IWM +0.8% versus a flat S&P 500. The S&P and Nasdaq post longest weekly win streaks since June at 4.

Data-wise today, @bespokeinvest notes just over 52% of the S&P 500 were overbought into today’s trading versus 6.4% oversold. We’ve only been below 10% oversold a few times over the past year. Separately, @RyanDetrick weighs in on December prospects, noting years that start well often see Q3 weakness but also a “chase” into year end. Additionally, he notes equities have tended to do well in December of a pre-election year. Lastly, on housing (per Redfin), luxury home median prices in the US climbed 9% year over year in Q3 versus the median price of non-luxury home up just 3.3%…but both were at record Q3 levels.

Heading into the final hour of the shortened holiday session, the S&P 500 remained flattish while the Nasdaq saw a modest decline. Breadth held in favor of advancers at about 2:1 reflecting the outperformance of small caps, as the IWM was +0.6%. Leading sector ETFs were Energy (XLE, +0.63%), Materials (XLB, +0.53%), and Health Care (XLV, +0.4%). Laggards included Communications (XLC, -0.48%) and Technology (XLK, -0.35%) in the red and Utilities (XLU, +0.08%) and Real Estate (XLRE,+0.13%) which had clawed their way back to small gains. Consistent with the underperformance of big-cap tech, in particular, Growth underperformed Value. The Russell 1000 Growth was -0.19% versus it’s Value counterpart at +0.28%.

Some top stock movers:

·     ICLK rises after announced that it has entered into a definitive Agreement and Plan of Merger with TSH Investment Holding Limited https://tinyurl.com/mr365hwv

·     IRBT shares jumped on reports Amazon (AMZN) is set to win unconditional EU antitrust approval for its $1.4B acquisition of robot vacuum maker iRobot ($IRBT), three people familiar with the matter said on Thursday, Reuters reported. https://tinyurl.com/yusrwb6c

·     NVDA shares slipped on reports Nvidia has told customers in China it is delaying the launch of a new artificial intelligence chip it designed to comply with U.S. export rules until the first quarter of next year, two sources familiar with the matter told Reuters.

·     VSTO rises as the WSJ reported late Wednesday Colt CZ Group has made an unsolicited offer to acquire U.S.-based Vista Outdoor that values its equity at $1.74B https://tinyurl.com/2224c7df

·     XPEV rises after Volkswagen announces that it will develop a new platform, known as the A Main Platform, for entry-level EVs in China; Reuters notes Note in July, Volkswagen partnered with Xpeng to develop and roll out two EV models by 2026.