Indexes Test Key Levels; Palantir, Valero Energy, MongoDB In Focus

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0:25Good afternoon, everyone, and welcome to Stock Market Today for Thursday, November 6th. It's Alexis Garcia here. And the major indexes slid today as concerns over a spike in layoffs pushed tech stocks lower. And here with me to help break down everything you need to know about today's trading action is IBD News Editor Ed Carson. So, Ed, what's on tap for us today? Well, I felt like the market was breaking things down. Do I need to break things down any further? Unfortunately, we do. I want to take a look at Palantir, Valero Energy, and MongoDB. So, PLTR, VLO, and MDG. All right. Before we check in on those stocks, let's just see how the major index is finished, painful as it may be.

1:15The S &P 500 down 1.1 % today. The Dow lower 8 tenths of a percent. The Nasdaq sliding 1.9 % and small caps also slumping 1.6%. And so, Ed, I'm going to get my chart up here, but talk to me about this recent spike in layoffs we've seen. I think it's one of some of the highest levels since 2003, I believe. But talk to me about some of the fear that's creeping into the market here. And we're on the S &P chart. We see this downside reversal. So what's your thoughts on the market action? Yeah, normally we don't pay too much attention to challenger layoffs, but they were really high. And we don't have that much other data because the government shutdown means we really aren't getting many reports.

2:02And this also contradicted a couple of other reports that we had yesterday, the ISM services and the ADP, which weren't great, but, you know, showed some positive growth. So that undercut that. You look at this chart, a lot of things here. We went through the 21-day line decisively after sort of holding that level the last couple of days and all the moving major indexes did this. It also is back below, especially the S &P, it's back below this sort of other pause. There was this pause in October. And then the last week or so of October, we sort of punched out, or late October. But now we're back below that 67, 64 area.

2:40So just sort of back in there. And it's also, guess what, a lot of leading stocks. They broke out of little handles, and a lot of them have rolled back over because they're going to follow the market. And again, we've had two up days and two down days, but it's been two, you know, one step forward and then two or three steps back. They're not equal, you know, so definitely lost ground here after looking really strong a week or so ago. And let's just check in on the NASDAQ. Similar action here, reversing lower below the 21 day line, Ed. So thoughts here, because it seems like tech has really struggled, especially today.

3:17So, again, thoughts here on the chart action. Yeah. For one thing, let's again, and the same kind of thing here is I guess we're just sort of flirting with it, just getting into the top of that prior range. But we're still round tripping some of those gains. And I don't want to make too much of this. We're still basically writing a rising 21 day line. One or two good days and we're right at record highs. So, again, for people who bought stocks in April or May or June or even back in August, chances are those stocks are still doing well. I mean, there's individual examples, sure. It's really for new buys.

3:51It's more of that's where the problem is. You know, new buys over the last few weeks, those are often coming into pressure. So I don't want to be too gloomy on the market. But I think investors who made new purchases, they probably either needed to or will need to be cutting back or exiting those positions in most cases. Let's just check in quickly with small caps, Ed. This one down today, about 1.8 percent, breaking below this 50-day line. Yeah, so that's not great. And even undercutting the recent lows, so this is the lowest in almost a month. You know, it was nice to see this recover. this was only, but, you know, here we are once again.

4:30And it's just hard to make it. If you're buying on strength, you know, it just whipsaw markets really are tough for active investors because you make this buy. And then if you're going sideways, the market may end up going sideways. But if you keep on buying at the relative highs, you can get chopped around pretty quickly in that environment. And let's switch over to RRSP. That's the S &P equal weighted ETF, giving just a sense of market breadth here. This down about seven tenths of a percent today. And it's been trading below this 50-day line here over the last week and a half or so, Ed. So what is your sense of this here?

5:07Yeah, I mean, this wasn't the worst. It wasn't, you know, it actually did better than most of the major indexes. But, yeah, it's sort of losing sight of the 50-day line. It's not, you know, tech led the sell-off today. Small caps led the sell-off. But there's been weakness, you know, in the last thing. And this really never really escaped the range from before. Or, you know, never, well, the major indexes were powering to new highs. This never really did. And you could argue in some ways this has sort of been going sideways since early August in some rough way out there. So, yeah, this has just been lagging.

5:40The RS line shows how much it's been lagging, you know, pretty much all year. Let's just take a look at QQEW. That's the NASDAQ 100 equal weighted ETF. This went down 1.7 percent today, Ed, and closing below the 50-day line. First time it's done that in a couple of months. So, yeah, not a good sign. It does show that while a few of the mega caps, not all, but a few of them are holding up reasonably well, you know, the NASDAQ, a lot of the NASDAQ 100 stocks are falling now below their 50-day line. And what about the 10-year Treasury yield, Ed? This has been a lot in focus lately, especially as we see these interest rates or the yield ticking up here.

6:22This down 1.5 % today, but again, moving up off of these lows here in October. Yeah, and today was obviously falling partly because of the stock market, maybe partly because of the layoff numbers. I mean, yeah, as I said, like when you see the yields rising, they were rising because of expectations that the economy was going to be doing better. And so while on the one hand, yields are negative a little bit for the stock market, but the underlying reason for that rising yield is good for the stock market. So, you know, it hasn't spiked. You know, it's still sort of in its downtrend. It was just starting to peak out of maybe a downtrend yesterday.

6:58You know, so for all this, it's still the trend has been lower, lower lows, lower highs along the way. And so I don't want to make too much of those yields right now. All right. Well, let's check in on a couple sector ETFs starting with FFTY. That's the IBD Growth 50 ETF. ETF, this one, not a pretty downside reversal today, down 5.5 % and closing at the lower end of that range. Yeah, pretty ugly action there and a lot of growth ETFs showing ugly action. And it also shows you, oh, it found support yesterday. Well, again, I like to use the example of, you know, when they take a battering ram to try to go through the castle gates, rarely in movies does it break through on the first time.

7:44They usually, oh, here we go. I got a few times. So just it's nice to hold support, but just because you did it today doesn't mean you'll do it tomorrow. And that's the case here. FFTY now breaking below. And a lot of things did this. And let's take a look at SMH. That's the semiconductor ETF. This one also down 2.3 percent today and looking for support at that 21 day line, also coinciding with that 350 price level. Yeah, this is looking a little better. And this looks more like the NASDAQ or, you know, some such. and actually holding the 21-day or basically holding it. But don't want to see too much more weakness here, but this is still a relative bright spot in tech.

8:23And what about software, Ed? That's IGV. This went down 2.2 % today, undercutting the lows of this base here and really falling below this 50-day line. Yeah, I mean, we're going to look at Palantir in a moment. Palantir is the biggest component. And also, there were a lot of software makers that made some nice moves, broke out in the last week or so. And some are undercutting, some are just testing. It just makes it tough. And you can see how this has definitely weakened quite a bit. And let's take a look at KBWB. This is the KBWBank ETF. This one was down about two-tenths of a percent today, but it's been trading tightly around this 50-day line.

9:07Yeah, I mean, that's still doing okay. And some other individual names in this big sort of big bank group are looking even better. But so this is still an area of strength. And I think that investors should be looking at this area, this ETF and some of the individual names. If your organization isn't managing its data with Everpure, then it's likely scattered all over the place. My Lord, for three days have I ridden to bring thee warning. The records thy great AI machine requires are strewn across five kingdoms. Yeah. The Everpure data management platform unifies data so you can always find it.

9:46No messenger needed. No more running around. Get out of the data dark ages with Everpure, a new era in data management. All right. Well, let's move on to some individual stocks. And we've been talking about Palantir a lot lately, Ed. This one continuing to slide today, down 6.8%, breaking below the 50-day line. Ed, so thoughts here on Palantir and what's been going on? Yeah, I mean, it had stellar earnings. I mean, they were accelerating growth again to 110%. Sales growth has accelerated so many times. I don't know how many quarters. It's been a bunch, up to 63%. I think their guidance is pretty good.

10:25The metrics, I think, were pretty good. I don't think that there are really problems in there. I'm sure somebody could find something. I had not heard of it. And even so, I mean, yes, the expectations were high, but it's sort of like if Jerry Seinfeld goes up before you and the crowd boos him, it's just like, well, how am I going to do? I mean, it's just like, I think that's a concern here. If this one breaks and it's cracking, I'm not saying it's broken. I think if it went decisively below the 50-day line, if it undercut these recent lows, that would be more of a concern. I mean, or certainly if you bought higher than one of you ate like 195 or something you're clearly suffering there but i think the concern is that if this one's falling what does it say about all these other stocks that may not be as powerful of growth you know as uh out there um so it's it's definitely something to watch like we talk about when we look at the market we say you want to follow the major indexes and the leading stocks well this is one of the very much the best stocks out there.

11:27And the fact that it's doing this on what seemed to be great results is not a good sign for not just Pallinger, but for the market. So what are you looking here then, Ed, as it hopefully can claw its way back above this 50-day line, but any further thoughts here on the technical action? Well, yeah. I mean, it's like it's been heavy volume. It's just sharp. It held the 21-day line in Boy Point yesterday, but today it did not. And yeah, a lot of volume. You know, again, it's not a decisive break of the 50-day line. If it went decisively through their undercut recent lows, then longer-term holders could choose to sell some.

12:08Again, you have to make decisions. Selling a big winner is always an art versus a science. I totally get there's no need to necessarily do anything there. But this was really disappointing technical action, especially given the news. And we could just see on the weekly here, Ed, that move. Yeah, that's not good. This week. So let's go ahead and move on to Valero Energy. This one up about 3.5 % today, peaking above this 178.43 by point, Ed, but we see this RS blue dot here hitting highs as this is getting ready to break out. So thoughts here. Yeah, and I think you could have treated the short-term highs from a week or so ago, and I think it may have closed just below that as well, right on.

12:51But that basically in there, or even a downward sloping trend line in that handle, it's a flat base, so it's not going to have a handle, but you can treat it as sort of an early entry. One thing here is that today, I know that crude oil prices fell just a smidge, but gasoline futures rose almost 3%. And ultimately, you know, you could talk all live on day about this and that, but refining stock, they make their money off of how much do they have to pay for oil and then how much they can sell their gasoline. And so the spread went like 3 % wider today, if nothing else. So a lot of refining stocks are doing well today.

13:27There's a few things that this group is doing well. The RS line hitting a new high. That's been a while. A lot of energy stocks in general are not, but this one's doing pretty well. It's probably not too far away from the 50-day line. And energy stocks, like, you know, not necessarily solar stocks, but energy like traditional oil and gas stocks sort of follow oil prices to a greater extent. So they can sort of go with their own drummer. If you're worried about the market and you say, oh, I want to add some exposure, energy is a way to do it that's a little bit not correlated with the broad market so much.

14:05All right. Let's hop on over to MongoDB. I'm sorry, there's an ambulance driving by my house right now. But let's just get your thoughts on this chart. Yeah, this one, look, again, this is why it's so tricky. This is one of those software names that sort of moved out last week. And then on Monday, it announced a new CEO and also strong preliminary numbers. So it went up to a new 52-week high just a few days ago, backed off, and then came back to test the buy point. Today it rose, so it's nice outperformance. Now, that may be somewhat tied to another software maker, Datadog. They're not really peers, but Datadog and MongoDB both have a lot of operations with Amazon.

14:48So Datadog doing well. You know, you can infer maybe, maybe that it's good for MongoDB. So that may be one reason why Mongo was able to offset to arise. But it's just difficult. We've seen other stocks that have gone below the buy point. What do you do here? You know, if you bought it, this just shows you, and this is a positive thing because so far, if you held on to it, you're okay. You know, but there's other ones that did not. It just makes it, this is why it's so tough. You can't just, if you knew that if it rolled over that it was going to then take 10, 15, 20 % selling would be easy. It's like it's not working, but then this can happen.

15:21So again, this is showing relative strength. I mean, somebody could have bought this. This doesn't seem like the day to be doing that. And you don't know what tomorrow brings. I certainly feel like, yeah, people who bought this a few days ago and held on could breathe a little bit of a sigh of relief. But it's just tricky out there. But a lot of things going well with this stock. A lot of fundamentals and technicals are looking good right now. All right, Ed. Well, those were three you wanted to cover, but we do have some earnings out there after the close. Why don't we check in on IREN? That's a Bitcoin miner turned AI power play.

15:56This went up about 2.8 % after hours, Ed, but another one that had kind of an ugly downside reversal here today, down 12.4%. Yeah, and I haven't looked at the numbers yet, and who knows how this one will go. And you can just see the big intraday swings this has had over the last several days. I mean, this is a super volatile stock, and the market's volatile, so this isn't really surprising. But so far, this is fine. I mean, it's been riding its 10-day, 21-day line. And how about SoundHan? That's ticker S-O-U-N. Also due with earnings today. This one's kind of in that no man's land here between the 50 and 200 day line.

16:35But it looks like it's down about 2.8 percent. Yeah, not acting great. It sort of broke through. I mean, it's like it's fallen off quite a bit. That is a huge drop, you know, in just a few days heading into earnings and it broke through the 50 day line. So it needs repair time, even if things work out. How about StoneCo? That's ticker S-T-N-E. Again, this one with earnings today, down about nine-tenths of a percent, but has been trading tightly here, Ed, after it had this great breakout, ran up to a 20 % profit zone. And, you know, we had a pullback here to the 50-day line in mid-October, but it's been trying to move out and digest some of those gains.

17:18Yeah. I mean, that one is, it looks like it had mixed results. And so it's down a little bit after hours. It is really close to, you know, that may not be a flat base, but close to what will be a cup base soon. So get above these highs, short-term highs or the overall highs, that would be a buy point, but it doesn't look like it's going to happen today. All right. And then how about take two interactive, Ed, another one with earnings today, this one down almost 10 % after hours. It tested, or it looks like it's flirting with this 50-day line here and technically in a buy zone. Yeah. So it doesn't look like it's going to be there for long.

17:54I don't know what the results were, but they delayed the latest grand theft auto, which I think they had delayed previously, but now it's not going to come out till November 2026. So that's disappointing, people. It was looking good, but there wasn't really much of a cushion here. So yeah, so that one's not great. Expedia, though, is looking great after hours. Yeah, this went up 14%. It's retaking this conjoined 50 and 21 day line, Ed. So again, thoughts here. Yeah, I mean, I suppose, I mean, this could be sort of a breakaway gap. You could have sort of treated from 229 over as sort of a flat base.

18:31If you just sort of ignore that weird one bar there, there would have been some kind of base that would have formed. So, but it's going to gap up above all of that. But nice action so far. There has been some positive signs lately in the hotel space. So that's going well. There's just a lot of movers out there. It's going to keep going. The big news after the close, which hasn't happened yet as far as I know, is the vote. Elon Musk's pay for, you know, if that pay deal is going to go through. Almost certainly will. Almost certainly will. But I don't think anything has happened yet. And then there's also the question about whether shareholders will prove buying a stake in Elon John Musk's XAI.

19:12I assume that'll go through too. But then who knows how the market will react to this? You know, will it be, you know, this is going to be a positive catalyst? Is it going to be sell the news? Are you going to whipsaw like we've seen last several days? It's whipsaw higher ultimately in the last couple weeks. But it's that kind of market. So it's just been it's been tricky, even though the general trend has been has been positive. All right, Ed. Well, thank you so much for your analysis today. We'll be back with more market analysis tomorrow morning, starting with IBD Live. You can head on over to investors.com slash IBD Live for all the information there.

19:49And we'll see you right back here tomorrow after the close.

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