Market Divided Before Jobs, Tariff Ruling; TJX, Valero, Carpenter Technology In Focus

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0:40Good afternoon, everyone, and welcome to Stock Market Today for Thursday, January 8th. It's Alexis Garcia here, and there seemed to be a little bit of a divergence in the market today as investors await new jobs report data and a potential ruling from the Supreme Court on Trump's tariffs. Defense and small caps had solid gains while tech retreated. And here with me to help break down everything you need to know about today's market action is IBD News Editor Ed Carson. So Ed, we have all this stuff going on in the ether. And by the way, we're also kicking off earnings season as well next week. But what are your thoughts here and what do you have on tap for us today?

1:22Well, I have TJX, Valero Energy and Carpenter Technology that I want to take a look at. All right, well, we'll get to those stocks, but let's just quickly run down how the major index is finished. The S &P was essentially flat today. The Dow up six tenths of a percent, the Nasdaq down four tenths of a percent, and small caps up 1.1 percent. So let me go ahead and get our trusty charts going here, Ed, and we'll start with the S &P 500 because as we know, the major benchmark index hit new intraday highs yesterday, falling up today, essentially remaining around the same area. So any thoughts here?

2:02Yeah, I mean, the S &P ultimately is where I think people should be thinking too much because it's like, we're flat. It was ultimately, it was a very mixed day, but that can happen on day to day. I mean, you know, yesterday the NASDAQ led, today the NASDAQ lagged. But still all the major indexes are close to record highs. It's definitely a market where you want to try to be diversified. There's a lot of sectors that are working well, so you want to try to find leading stocks in different areas, maybe not have everything be high beta names, certainly not high beta AI names, but taking advantage of that.

2:38And also just so you have to be – there's opportunities, but you definitely can't just set it and forget it. Like there are some rallies where if you did just sort of walk away, everything's going to be fine for a while. Others, you know, just look at how things were. NASDAQ came down. It was actually worse than that. The NASDAQ, the text, the damage in text was worse than that loss. We'll look at some other things that will make that clear. But, you know, I mean, look, the NASDAQ poked a little bit above there. It's very close to the 50-day line. It's very close to record highs. So that's sort of how the market is right now.

3:10Yeah, let's just take a look at the Dow industrial average here, Ed. This one, again, holding a gain today. And as we saw, a lot of defense names on the move, probably helping this out a little bit. Yeah, defense names did well. Some of the giants came off highs. But yeah, this has been doing quite well lately. I mean, this is right up there at record highs. It was sort of the first index to go into new high territory, and it's holding those gains for the most part. So acting very well. And let's mention small caps as well. Another strong day today, following up on a nice week of gains here after touching the 50-day line back on January 2nd.

3:53Yeah, it was getting a little worrisome. And that was around the time when the NASDAQ had gone through the 50-day line. The small caps had this big run and then came all the way down to the 50-day line. But boy, since then, very strong. Really nice action today. And we talked a little bit at the beginning, and I know you and the IBD Live team, especially this morning, it just seems like maybe there's a little bit of divergence happening in the market today. We're looking at RSP, this up almost nine-tenths of a percent. But when you look at QQEW, that's the NASDAQ 100 select equal weighted ETF, this one down 1.5 percent today.

4:31So what are you seeing out there in terms of market breadth? Yeah, we saw some big losses, some of the big winners from last year. I mean, not all, but there were definitely stocks that were down 7%, 10 % even, some of the big winners from last year. So, I mean, the NASDAQ was somewhat helped by Google, by Amazon, by Tesla. I mean, none of those were moving a lot, but they were mega caps are rising some, offsetting some pretty heavy losses in some smaller companies. But when you get to QQEW, these are still big companies. They're still the 100 biggest that are non-financials in the NASDAQ. But it still doesn't have that super weighting by the mega caps.

5:10And you can see how much damage there was. Still only down to the 21-day line. It did touch a record high yesterday. So you don't want to make too much of it. I mean, again, it was a very divergent day. If that continues over several days, over several weeks, then you've got a real issue. But yeah, it was a really bad day for a lot of techs. And that's, you know, once you get outside of a few of the mega caps. Yeah, let's dive into that. Let's start by looking at SMH. That's the VanEck Semiconductor ETF. This went down 1.5 % today. Yeah, I mean, NVIDIA was down 2%, but there's a lot of names in here that were down quite a bit.

5:49And some of the names that were, you know, even harder. So NVIDIA went through the 50-day line. So there's definitely some weakness in the chips that have been holding up Taiwan Semiconductor. That actually acted pretty well. They will have sales tomorrow morning. So that'll be interesting. I mean, look, that's just for Taiwan Semiconductor. But the JAG report and then the terrorist ruling, I mean, we could see a lot of movement in just a few, you know, an hour or two into the trading session could look a lot different. So that'll be interesting. But SMH pulled back after a strong run for, you know, early on.

6:22All right. Well, let's go ahead and look at XBI. That is the biotech ETF. Down 1.8 % today, Ed, but it had a really strong gain yesterday. But it seems like it's really kind of been range bound here between this 125-119 level. Yeah, it was a nice bounce, and it did give up a lot of those gains, but not all of them. This is an argument for why you want to try to get things early on. I mean, not, you know, not wait till you get to the very, very top, because if you bought at the very top, you know, AXBI at the top or some of the some of the names in there, you could be down substantially. But, yeah, it's still range bound.

7:03It's been holding some key support and definitely one to watch. All right. How about we take a look at ITA? That's the Aerospace and Defense ETF. And again, Defense stocks having a pretty good day. This up about four-tenths of a percent, Ed, but really kind of giving back some of the gains, finishing in the lower end of that trading range. It was a strange day because the defense giants jumped on this news that President Trump says, hey, we're going to sharply increase the defense budget. And whether or not that happens or not, that may not happen. But even a decent gain increase in there, assuming you're not spending it on the troops, you're spending it on weapons, that can mean a lot of money for companies in there.

7:40There were some individual names that were not as directly, that they had huge gains. But then you had more civilian aerospace names that a number of them reversed lower, including we'll look at Carpenter Steel and Carpenter Technology. That's aerospace related. So there were a number of aerospace names from FELL. So this was a very mixed route. They all sort of rallied to start and then it was like, well, then it really diverged soon after the open. So this has been a strong group, a strong area, but it was very mixed. This was very divided within this ETF and sector today. All right, let's take a look at XRT, Ed.

8:16That is the retail ETF. This went up 1.8 % today and breaking above this cup with handle base here, 89.28 pivot point. Yeah, there were a lot of retailers that did well today. Some of them were out of position, but showing real strength here. Again, consumers doing well here. for all the talk and my concerns about it. We're concerned about jobs, but consumers are still spending one way or another. And so, you know, there was definitely some breadth today. At CLA, we're in your corner and on it. We coach tax strategies and Little League First Base. We help you adopt AI data tools, and we adopt rescues named Buddy.

9:02We walk your factory floor and jog the local 5K, though sometimes we walk that too. Wherever you're coming from, we're right there with you. Wherever you're going, we'll get you there. CLA, CPAs, consultants, and advisors. Learn more at claconnect.com slash with you. All right. Well, speaking of retail ad, let's go ahead and take a look at TJX. This one, a gain of 2.7 % today. And looking like it's getting over some of these recent highs around the 157 area. Yeah, that's a pretty short consolidation. And so that by itself would be, well, that's more like an add-on buy point or something. But if you go on to a weekly chart, it has been bouncing this week off the 10-week line.

9:45So that's a nice thing to see. Sort of the first time, maybe the second time, but the first time wasn't really pretty close into the base. First time since we really cleared that base, the prior base, decisively in there. So that's a place where you could be buying it. It's now above that short-term high, providing an extra reason while it's still pretty close to the 10-week, 50-day line. It bounced off the 21-day today. This is one of the discounters, retailers, that's been acting well. It was held up pretty well, pulled back a little bit a couple weeks ago, but basically held on to the 21-day, held on to the 10-week, and made a strong move today.

10:25This is probably not one that's going to sell off with AI. So when we're talking about diversifying, this is one and a number of names, but a way you can diversify and, you know, having some names like this can really help if you have some big losers. All right. How about we take a look at Valero Energy? That's ticker VLO. This went up over 4 % today. And, you know, it peaked above this buy area here around 185.62 yesterday, reversed from that. But a nice, powerful move today in the buy zone. Yeah, the market really seems to think that refiners, especially those that have, you know, refiners on the Gulf, which traditionally got a lot of oil from Venezuela, which is and Venezuela's crude is the sour crude that usually trades at a discount.

11:14But it's something that the Gulf refiners are set up to use. So there's a lot of talk about long term things with Venezuela. But in the short run, it's not that hard. They're going to send, Venezuela's going to send some more oil. It looks like sanctions are going to release. So it sounds like regardless of all the other possibilities, it seems like at least in the short run, we're going to get more crude oil from Venezuela to the U.S. And so this seems like a very tangible near-term winner from Venezuela when it's hard to know how all that's going to shake out. But held up, paused around that buy point, pushed higher today.

11:49And, you know, just nice action here. The earnings have turned around, just turned around the latest quarter. You know, the oil prices are low, but gas prices have come down. But I don't think they've come down nearly as much as oil prices have. So that crack spread is why the profitability has increased. And maybe that could continue if they get crude oil. That's really what a lot of the refineries are suited for. All right. Well, how about we round this out with a look at Carpenter Technology. That's ticker CRS. This one peaked above this 342.11 buy point today, Ed, but then reversed lower and finished.

12:29It looks like right at that 50-day moving average. Yeah, so it's nice that it closed above that. So if you weren't paying attention, you might see what happens at this point because it held the 50-day line. But man, that was an ugly reversal. I mean, it hit a record high. there didn't seem to be a news but there were a lot of traditional type aerospace stocks that had bad days this was really bad and it was plunging through the 50-day line well below the sell zone i mean that like is uh so it's clearly a strong sell signal for people who were buying that breakout even here i mean anybody who bought writer on the breakout is you know you're six percent down is what it kind of you know is what at least so that's just that's just unfortunate now for longer time holders that's different uh but really ugly action this has been a real strong performance it was acting very well uh when it pulled back to the 50-day line a week or so ago but in light volume then it bounces off of there in strong volume you know stronger volume so it was doing all these good things uh but you know it's it's not what you did yesterday it's not what you hope it'll do tomorrow it's it's what happens today uh we'll see from here it could bounced back, but I think it was, during the day, it sent a strong sell signal.

13:42Nice that it held a 50-day line. So if you didn't sell, definitely want to be seeing how that, you know, ends by the end of the, you know, end of the week. But if that closes, you know, I would say any, you know, you have to pay attention to sell rules. If it gets to that 7 % to 8 % sell rule, other things, it's closing below the 50-day line from this level. If you're a recent buyer, that's not it. That's just not a good situation. All right. Well, we'll be keeping an eye on that level Ed. And thank you again for all your wonderful insights today. And that wraps it up for this edition of Stock Market Today.

14:17We'll be back with more market analysis starting tomorrow morning with IBD Live. You could head on over to investors.com slash IBD Live for all the details there. And Justin and Webby will be back tomorrow to give you their weekly take on the market. So you won't want to miss that. So that'll be tomorrow after the closing bell. Thanks so much for watching. We'll see you then. Thank you.

15:07emotions.