Nasdaq Reclaims Key Level; Howmet Aerospace, Johnson & Johnson, Sandisk In Focus

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0:41Good afternoon, everyone, and welcome to Stock Market Today. It is Monday, July 6th, back from the 4th of July holiday weekend. My name is Ken Shreve, and today I am joined by our news editor, Ed Carson. for a look at the stock market today. And before we talk about what happened in today's stock market, let me bring in Ed Carson, who has got three stocks to watch. Good afternoon, Ed. Good afternoon. I would like to take a look at Helmut Aerospace, Johnson & Johnson, and SanDisk. All right, Aerospace and Defense. We got a good defensive stock in Johnson & Johnson and a high-flying tech stock in SanDisk.

1:23All right, well, before we get into all that, Let's take a look at the broad market here. We had a good start for the NASDAQ today. Nice day of outperformance for tech stocks. Let me pull up a chart of the NASDAQ composite here. Nice day for semiconductor stocks. We did have the SMH, that VanEck Semiconductor Index, close a little bit off highs. But here's a look at the NASDAQ composite after a little bit of selling on Thursday. day. NASDAQ composite up 1.1%. I mentioned the selling in the semiconductor stocks today. SMH, that was up as, saw it up as much as 3.5 % today. SMH ended higher by about 2%.

2:12Let's take a look at the S &P 500. That was not up as much as the composite today. S &P 500 managed a decent close above that 7 ,500 level, S &P up 7 tenths of a percent. Take a look at the blue chip index here, Dow Jones Industrial Average. That lagged for a good portion of the session. That was up two tenths of a percent. Did see some nice gainers in the blue chip index today. The problem is we had some decliners as well in the health care space. We'll get into that in just a little bit. And then the small caps also up four-tenths of a percent today. So, Ed, start by taking a look at the composite here.

2:59Not a bad day considering the selling that we saw on Thursday before that July 4th holiday. We had a distribution day for the NASDAQ, a close below the 50-day moving average. But nice to see the index recover those moving averages today. Yeah, and we are still in a range, though. We're still in a range of the last few days, the last few weeks. And it's been a volatile stretch for the NASDAQ, and a lot of stocks was in there. The NASDAQ has been helped by, at times, software rising when chips have fallen. So if you have those hardware names, those chips, those opticals, there are some big swings.

3:36Very important that we got above the 50-day line and the 21-day line. But you need to get, I think, at least get above last week's highs. you know then we're sort of like breaking a downtrend you know breaking of other short-term highs there's still other levels I mean and it's just there are days that look really really strong and the days that do not and it's just hard to know should you be getting out of them should you be doing other things I think the volatility is such that newer buys over the last several weeks chances are there's a very good chance you would have been shaken out I mean some of course took off and you didn't have to, but by and large, most of them probably did.

4:12And maybe people wanted, and this is, you know, not saying this is finished, but they probably would have wanted to gravitate at least out of AI. You know, it's one thing to software, there's some aerospace, there's some financials, there's a lot of healthcare names, not necessarily that many in position today, but still very volatile. This was a positive session. It was necessary, but not sufficient to really get you that excited about AI and all those that chip plays. Yeah. And plus, we're looking at the NASDAQ too, you know, this pullback here where we saw the NASDAQ come through the 50-day moving average.

4:46We're dealing with an index here that had some pretty heavy volume to the downside here. And now we're looking at the index sort of coming back in light volume. Typically, when an index comes down in heavy volume, you'd like to see some conviction behind the buying. And we just haven't seen a whole lot of conviction behind the buying yet. Doesn't mean that this rally isn't going to work out, but it would be good to see a little bit of conviction behind the buying, be good to see a little bit of some heavy volume behind some of these gains. We could see it. I know our senior market strategist, Mike Webster, doesn't look at volume as much as he used to, but still looking for the NASDAQ to resolve some of this distribution that we've seen in recent weeks.

5:36So far, some pretty light volume behind the gains in recent days. Just to make one more point. I mean, it could be, I mean, there's concerns about that, you know, like, oh, it's some of the good news for AI hardware, like Micron, the prices are high. It's squeezing some of the other names. And so there's always that concern. Will the AI spending continue? And I'm not saying there's no reason why it won't, but if it leveled off, if it did anything. And so it could be that it's not until the end of this month when all the hyperscalers come out and say, hooray, we're spending like crazy. You know, it could be that AI hardware has chopped because you can make an argument for this or that.

6:13Now, last time I started a little early. I mean, part of what happened is that the Iran war was a ceasefire. But the other thing was Amazon just kept on pounding the table saying people love our stuff. We love spending money on AI. We may not get that for a few weeks. So it could be, I mean, who knows? The market will do what it wants to do. You go up 5 % tomorrow, down 5 % tomorrow. But if you're looking for that conviction in AI, well, it may be a few weeks before people feel really confident to add to where they are because these stocks have obviously gone on big runs. Yeah, yeah, that's a good point.

6:44S &P 500, haven't seen as much institutional selling or distribution days, haven't seen as much distribution in the S &P 500. And the index probably looks a little better than the NASDAQ composite at this point. S &P 500, also above its moving averages, above the 7 ,500 level. Taking a look at some gainers in the S &P 500 today, Ed was looking at Arista Networks. This is a nice setup here. Arista Networks had an 8 % gain in the S &P 500 today. That is approaching a pivot of 177.48. So still seeing some decent setups out there. Arista Networks had a good day in the S &P 500. And also I was noticing Vertiv, VRT, which had been hit by some selling.

7:39That is still below its 50-day moving average. Got a little resistance at that 50-day line today. And then NetApp Network, used to be called Network Appliance. NetApp is making some progress off its 21-day. That closed near its session high today. Another nice gainer in the S &P 500 today. And then in the blue chip index, I mentioned some nice percentage gainers in the Dow Jones industrial average today, even though it didn't move a whole lot, seeing it settle here up three-tenths of a percent to another all-time high today. I saw Boeing was a nice percentage gainer in the blue chip index today, extending gains after moving above its 50-day moving average on Thursday.

8:29IBM software stocks, I think we're lagging today, but IBM up 3 % today in the blue chip index. And financial stocks also performed well today. Goldman Sachs, another decent gainer. But again, healthcare stocks lagged today as semiconductor stocks had a good day. Merck lagged in the blue chip index. United Health and Amgen kind of brought up the rear in the Dow Jones index today. Did want to take a look at some ETFs today. I know ITA was on your radar today in the market. This is the aerospace and defense ETF, E-T-F-E-D-I-T-A. This is in the process of breaking out here. Leadership are broadening out.

9:20Aerospace and defense stocks are still acting well here. Yeah, I mean, Boeing is a big component. GE, which reports next week. Helmet is a big thing. So there were a lot of names. I mean, some of the defense names not doing so well, but there was a lot of aerospace names and some of them weren't in position. But they were moving. And so, yeah, you could have done a few things and we can look at Hamlet later. We'll look at Hamlet later. But ITA was working something when some things are extended and some things are not set up yet. Or sometimes ETFs are a good way to play it. A little less volatility.

9:55And this is acting well in this space right now. When you need to build up your team to handle the growing chaos at work, use Indeed Sponsored Jobs. It gives your job post the boost it needs to be seen and helps reach people with the right skills, certifications, and more. Spend less time searching and more time actually interviewing candidates who check all your boxes. Listeners of this show will get a$75 sponsored job credit at Indeed.com slash podcast. That's Indeed.com slash podcast. Terms and conditions apply. Need a hiring hero? This is a job for Indeed sponsored jobs. Most definitely. You mentioned the performance of financials today on top of the chip stocks that did pretty well.

10:38Let's take a look at KBE. I think I need a new keyboard. I got a keyboard that is living a life of its own here. KBE, this is the State Street Bank ETF, KBE. Still showing a lot of relative strength here. recent breakout over 6544 here. Yeah. And, you know, banks sometimes go on decent runs, maybe not forever, but they go on decent runs at a lot of banks next week. A lot of, you know, it's a small number of earnings next week, but as you're well aware, because you write the earnings preview and I do the earnings cheat sheets, so we're sort of both thinking ahead already video that there's a small number, but they're almost all really important earnings reports, and a lot of them are banks.

11:25And so, yeah, they're doing well. You know, there's, if you, the Fed concerns are a little down a little bit over the last week. So the lower end has come down a little bit, maybe the higher end stretching out that yield spread again. So yeah, the banks are doing pretty well right now. Banks are doing well. We do have an interesting earnings report tomorrow after the close. is Penguin, P-E-N-G, Penguin Solutions. This is tracked in the same industry group as Micron and SanDisk. This is a provider of memory infrastructure solutions, a real high flyer. So I'm interested to see what Penguin has to say tomorrow after the close.

12:11This is a small cap,$3 billion market cap, fairly liquid, 3.2 million shares. But really a company that is kind of in a newfound growth phase here. Results in recent quarters haven't been great, but you can see growth is really expected to ramp up in coming quarters. So tomorrow, revenue is supposed to be up 26 percent and then growth really expected to pick up. So Penguin Solutions, AI stock reporting tomorrow. And Delta is going to really kick off second quarter earnings season on Friday. And then, as Ed mentioned, we'll get some financials kicking things off next week. All right. Another ETF to take a look at today, the chip stocks.

13:00Like I said, boy, SMH at one point today, early in the session, Ed, SMH was up. Let's see here. SMH was up about three and a half percent. did close near its session low today, but above the 600 level. Had a lot of nice movers in the chip space today, but many kind of gave back early gains, but still a decent performance for chips today. Yeah, and I do have a position in SMH. Yeah, so this was a decent balance, but yeah, it came off a low. And even if it had been at highs, it was an inside day. It was up to the 21-day line. and there's other names like that penguin what do you do with that it's up 10 but it was in the middle of stuff it's like where's the buy point on that so i think that's this is one of those days where if you already own a stock fine you might have made some good money but it was hard to hard to enter things and if you did you're buying things that may be up seven or eight percent it's like well we'll see what tomorrow brings i mean the way the market has been uh if that stock ends up up three percent and you bought it up eight you know you're down five percent so you could You could be in a stock that rises for the week but be down pretty solidly.

14:09That just makes it tough. So, yeah, just – but, you know, this is fine, but it's just choppy right now, and it's hard to enter, you know, in this environment. Yeah, I mean, AMD, Advanced Micro Devices, one of the big gainers in the NASDAQ 100 today. This one is still showing incredible price strength in the – And this one held a 21-day for the most part. So that was nice. So it was easy enough to hold on to if you owned it, but I don't know where to answer it. Yes, yes. AMD really has been a big, big leader in the chip rally. Of course, Alab has been another great winner in the chip design group, another stock holding the 21-day line.

14:53Qualcomm has been a laggard, but it did lead the NASDAQ 100 today up 5.8%. That one came all the way down to the 200-day moving average today. So that's some of your chip leadership in the NASDAQ 100 today. And then, of course, health care, XLV. This was a nice breakout last week. This is where leaderboard is mostly exposed at this point. Don't have a whole lot of tech exposure at this point, but biotech and some health care names. Nice breakout for XLV recently. And it was down today, but, you know, closed off lows and still showing a lot of relative strength here. A lot of groups of medical are doing well.

15:36The biotechs, as you say, there's the traditional drug makers, and we're going to look at J &J. There's health insurers like UNH, which we'll be reporting next week. So there's a lot of areas of medical which range from defensive to defensive growth to just, you know, speculative growth. But it helps that they're not part of AI, regardless of what it is. They're not really tied to AI. So depending on your investing style, there's probably something in medical that could fit your fancy right now, I can imagine. It is a big sector. It is a big sector filled with a lot of different companies, no doubt about it.

16:12All right. Well, we started off talking about aerospace and defense. So why don't we start by taking a look at Helmet here, H-W-M, Helmet Aerospace. Now, they are a big Boeing supplier, HWM. And here is Helmet Aerospace. Big, big company here. Market cap over$100 billion, but sitting just below a$280.74 buy point here. What do you see in Helmet, Ed? Yeah, I mean, you could wait for it to get back above that buy point. Though, obviously, you know, often it's been better to buy this off the 50-day line. I think as a compromise, you could have bought this today. It was sort of clearly breaking above the 21-day line.

16:56There's a mini trend line. I don't want to make too much of this trend line. It's two weeks. But I think you could have bought it here, you know, because it would have been tough to buy it off of the 50-day line because it was pretty abrupt. I mean, yes, it worked out when it did that a week and a half ago. But that, you know, it wasn't like a graceful decline. And so it would have been tough to do. Yeah, it worked out. But it also – this also has a little bit of AI because it makes components for turbines, like some of the parts or some other things. So it does have a bit of AI exposure, but aerospace is doing pretty well.

17:25This has been a strong performer for the last couple of years. This is not, you're not giving up too much. This is, I think last year, and I know there is some AI, but last couple of years, it's been one of the strongest non-AI stocks, I think, out there. And you can see the relative strength line has been pretty solid for quite a while now. It's actually leveled off more this year, but that's after rising. And it's not like going sideways after falling. I mean, that's what sometimes you see, oh, it's gone sideways for the last six months after lagging for the past decade. Now, this one has been leading, and the RS line is pausing a little bit, but that's also because the market has still performed well.

18:00This has still continued to go up nicely in 2026. So, yeah, solid growth. You know, aerospace is doing well. AI obviously has generally done well, even if lately it's been a little choppy. So a lot to like about this name. How, Matt, because of the earnings stability rank here of seven, has been in the big cap 20 in the past. I don't know if it's still in our big cap 20 list of large cap stocks, but because of that outstanding earnings stability rank of seven, it has been in the list in the past. And it's been able to maintain a high composite rating for quite a long time because of excellent fundamentals.

18:43And like you said, Ed, a great long-term track record of price performance. So Helmet, a big-time leader here and still showing a lot of relative strength here and sitting just below a buy point here with a good-looking relative strength line. So that's Helmet Aerospace. All right, now we're going to go defensive here. I think Johnson & Johnson is still a Dow component, is it not? It is. It is, right? I can't keep track of what has left the Dow and what is still in the Dow. But Johnson & Johnson in the process, a nice breakout for Dow. I think it was just last Thursday and a tight, tight action today sitting near a buy point.

19:30Is the market getting defensive here, Ed, or is this just that healthcare trade just working out here? Yeah, a lot of these biotechs, I mean, a lot of these big pharma names have been breaking out lately. You know, so this one has relatively meager growth. Let's be clear. The growth, you know, it's single-digit growth, and that's what it generally does. So you're not – can't expect massive runs. It actually had gone on a decent run. So this episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50 page restoration block or finally break down that long article you've had open for weeks.

20:16Gemini and Chrome is here for it. Ready to make anything online make sense. There's no place like Chrome. Check responses set up required compatibility and availability varies 18 plus. you know with defensive names it's tough because there's only you know it's sometimes when you it's almost like you're trying to prevent your capital from falling but it could be a prevent defense kind of thing where you end up losing because what if the market takes off again let's say ai goes crazy again won't will defensive names you know turn off fall down or at least lag probably if the market really sells off well j and j probably isn't going to tumble but will it rally I don't know.

20:55So it's, you know, one nice thing is like medicals often do well in this murky area where things are okay. And a lot of the market is fine. Let's be clear. I mean, growth investors have been all these chips and AI and that's been tough, but the market generally is fine, but still it's sort of this uneasy, but still positive. That's a good place for defensive names to actually, to actually make gains. But yeah, I think this one can work. This is our stock of the day. It's just, it's just, you have to know what's going on. Defensive doesn't mean it's safe. It's defensive in a certain environment and it can turn on you.

21:29So just know that. I mean, there's been a decent run over the last year and a half or so. It's paused in the last few months, but that is after a decent run for a company of this size and growth rates. So you can be playing on this, just you still have to be able to react to it if things turn on you, if the market shifts to different sectors. Yeah, no doubt. Another company with a very low earnings stability rank, so a company with a very consistent track record of earnings. And yeah, I mean, Johnson & Johnson not only gives you health care, which is outperforming now, but, you know, typically get a pretty decent dividend with Johnson & Johnson as well.

22:17So it can be a defensive area of the market as well. So, all right. Well, we go from one extreme to another, talking about healthcare and kind of defensive to the heat. And let's go to SanDisk. And SanDisk has been, well, it was a big, big winner of last year. And a lot of these memory and storage stocks have continued to do well this year. But they're, I don't know, Ed, they're looking a little vulnerable now. Oh, Sandisk is looking like it's getting ready to test the 50-day moving average after a heavy volume drop below the 21-day line on Thursday. Did not participate with the NASDAQ today. It reversed slightly lower.

23:02Looks like a test of the 50-day is imminent here. Yeah, and it was up like, actually Sunday night, it was indicated up like 8%. Various things are going down. It was up like 5 % or around the open. But yeah, it ended up closing essentially flat. And what's interesting is that the 10-week line, it was above the 10-week line last week. And even though it closed flat, it's now clearly below the 10-week line. Not clearly, but if you go to it because the 10-week line rose so much from week to week, it's now down just a hair below or unless it updated. Because mind you, when I was looking at it, it was at 43.

23:37So it might be right on the 10-week line. But this is the key area. the 21-day line and the 50-day line, whichever one you use, getting through the 21-day line, that was an area, especially if you hadn't sold anything on the way up, maybe that was a place to take some profits, just trim a little bit. But definitely the 50-day, 10-week line, that would be, you'd want to be trimming at least substantially because I know this has gone on a monster move. Again, this was a 2 ,300 just a couple of weeks ago. Even just a week ago, this was well over 2 ,000. So this one can drop. And they don't seem like anything now, But there have been 30%, 40 % corrections along the way.

24:15And it's always, well, it's bounced back. And I'm not saying it won't, but you have a plan, have a plan. And part of what happened overnight is that the COSPI, and I'll tell you this, it's never a good sign for the AI market when you think, boy, I wonder how the COSPI is trading. And that's the South Korean index because that's dominated by Samsung and SK Hynix. And it's a big week for both of those stocks because Samsung tonight, Tuesday local time, you know, there, but Monday night us, they're going to release preliminary Q2 earnings. And so that'll be a big deal for the memory plays. And then on Friday, SK Hynix will start trading on the NASDAQ.

24:53And so we'll see how that how that goes. Those are both trillion dollar stocks or close to it. So Sandisk is in an area. I don't know if it bounced. I'm not sure where you'd buy it because it's after a straight down. It'd be going straight up. I mean, if it paused here for a week or two, OK, then maybe you could have something. But breaking through the 50 day line, breaking through the 10 week line, that would be a big deal because this has been such a such a leader in 2026. And then you mentioned this morning on IBD Live that there were reports that Samsung is reportedly going to raise their DRAM prices as part of their earnings announcement tonight by 20 percent, or that was reported.

25:37And Sandus goes NAND flash memory. But, yeah, we know that memory prices generally are high, and there's been a lot of price hikes over the past year, which is why these earnings are just – it's gone an amazing run. But look at how Sandus' earnings are. They're in the thousands. I mean, it's just these earnings are almost unbelievable. They really are. I mean, they are they are rising so much for a big company. This isn't a biotech that had one dollar in revenue. And then the next year they have a drug and they're a billion dollars. Oh, look, we've got a big growth rate. That's the kind of growth rate we're talking about here.

26:08Only it's real over real. And so so but it but if that ever slowed down substantially, that would be a concern for investors. That's for sure. Gotcha. Gotcha. Okay. Well, that is going to do it for today's show. And yeah, NASDAQ recovered pretty well after a pretty harsh distribution day on Thursday. We were able to move back above those moving averages. So, Ed, appreciate your insight. Thanks for those stocks today. Thank you. It's going to be me and you for the next few days. Look forward to it. Thanks again, Ed. All right. But that'll do it for today, folks. And we appreciate you joining us.

26:53We will be back tomorrow morning. Ed is going to be in the host chair for another edition of IBD Live. He's going to be joined by the normal Tuesday crew, which means David Ryan will be on the panel, three-time U.S. Investing Championship winner. So be sure to join the crew for IBD Live. Tomorrow morning, we'll be getting things underway at 6.20 a.m. Pacific time. You can go to investors.com forward slash IBD live and check out a two-week trial. Like I said, Ed and I will be back here tomorrow morning, tomorrow afternoon, I should say, after the close. Possibly Justin and Ed will be a little musical chairs with the SMT video this week.

27:42But either way, we will see you back here tomorrow. Have a great rest of the day. Take care, everyone. Bye-bye.