Stocks Continue To Rally; ASML, Pan American Silver, Comstock Resources Strong

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0:39Good afternoon, everyone, and welcome to Stock Market Today for Wednesday, November 26th, almost at the end of the month, one day before Thanksgiving. My name is Ken Shreve, and on today's show, we are going to take a look at another day of outperformance for the Russell 2000. Boy, what a four-day move it's been for small caps. Tremendous day of outperformance. Saw a little bit of selling late in the day, but four days of gains for the major stock indexes. Before we get into all of that, let me bring on our news editor, Ed Carson, who has got three stocks to watch. Ed, good afternoon. Good afternoon.

1:21Yeah, it was a successful four days generally, not just small caps, But yeah, really nice action. I want to take a look at ASML, Pan American Silver and Comstock Resources. Comstock Resources. Sounds great. Let me pull up a chart of the indexes here and we'll take a look. I'm looking at the Russell 2000, looking at this four day gain, it's like an 8.3 % gain over the past four sessions for the Russell 2000. And we'll get into that in just a little bit. But taking a look at the NASDAQ composite here, it was holding a gain of a little more than 1 % all day. It looks like it settled for a gain of eight-tenths of a percent.

2:07But you can see four straight up sessions here for the NASDAQ after that really volatile session last week. So a nice recovery for the NASDAQ. We were waiting for it to get over this high right here from last Thursday. Thursday. So it has, in effect, broken out of a downtrend. We'll move on next and take a look at the S &P 500, which also is working on four straight gains. That, too, is really not far from all-time highs, just like that. That also rose pretty much in line with the NASDAQ, a little bit less. That was up, looks like it settled for a gain of 7 tenths of a percent, Checking in on the Dow Jones Industrial Average, also up four straight sessions.

2:57That settled for a gain of seven-tenths of a percent. And then we mentioned the small caps. Just looking at that four days of gains, very close to an all-time high here. Again, that is four days, a gain of about 8.3 percent over those four days. Small caps ending higher by 1 percent today. So, Ed, again, just a really powerful rally for the market here. Things weren't looking all that great on Thursday when we had that big NVIDIA earnings reversal, but we've seen a lot of good action in individual stocks. You know, seasonally, a pretty good time for the market as we head into Thanksgiving. You know, a lot to like over the past four days here.

3:48Yeah, and just it's been strong. It hasn't been, I mean, there's been some strong gains for sure, but it's like, it hasn't been these jaw-dropping 4 % gains. It's just that strength, strong, strong, strong. And okay, yeah, all right. First, we got a little bounce. Fine. You're going to get a bounce somewhere. It wasn't that impressive on that Friday. Then a strong move, but okay, we're at the 50-day line. Let's see. And then we got above it. And the NASDAQ just barely, but that's partly because of NVIDIA and A &B. The others did better. But then today, now we have it again. Another hurdle. It's more clearly above the 50-day line.

4:18And all the indexes are above their October 10th highs. You can basically see a downtrend line that NASDAQ's breaking. And that's not just important for the NASDAQ, but there's a lot of stocks that look like the NASDAQ and the S &P 500. They've come up through their 50-day lines. I mean, some of them are outperforming, but they've been flashing buy signals or breaking out. And it's just been really impressive. Just every day, it just seems to be going well. And there's been potential hurdles, but they've gone right through them. So investors have to take note of this. You know, again, like the market, you don't have to go crazy.

4:53You just have to go steady. It's amazing how 10 % every day within a week or two, if the market's worth investing in, you can get up to pretty fully invested pretty fast without being crazy on any one day. And if the market pulls back, if you're only a little bit invested on any given day, you aren't going to get hurt that badly. So you want to be aggressive, but do it in a gradual way, I guess I'd say. You know, you know, that's don't wait, you know, and I think that's working out for a lot of folks right now. Yeah. Yeah. Breath was pretty good on the on the Nasdaq today. We had about two and a half to one positive when we look at the advanced decline.

5:35This is the 10 day moving average for the advanced decline line. You can see that starting to swing into a nice uptrend. And breadth had been pretty weak on the NASDAQ for quite some time, but seeing that swing into a nice uptrend. Breadth on the NYSE for the S &P 500, we mentioned that ended with a gain of about 7 tenths of a percent today. Breadth even better on the NYSE today, Ed, better than 4 to 1 positive. And when you look at the 10-day moving average for the breadth on the NYSE, also swinging into a nice uptrend here. What I find interesting, you know, you're seeing, you know, the 10-year Treasury yield has really been on a precipitous decline here, actually breached the 4 % level here.

6:27This yield was up around 4.16 % last week. So it's down about 16 basis points as the odds for a rate cut have grown quite a bit for the December Fed meeting that is coming right up. Maybe still some concerns, Ed, about the health of the economy. The Fed is in a kind of a tricky spot here, seeing some softness in the jobs labor market. inflation that is kind of still sticking around. The Fed always seems to find itself in a tricky position. I mean, anytime you see money flowing into the bond market and rates falling hard like they are, reasons to be a little cautious here or what's your take on this big drop in rates here?

7:15Yeah, I think it is some concern about the economy. It's also hope for the Fed, but a lot of it on the 10-year yield, that's a lot often more about the economy. But we're seeing yields come down across the yield spectrum. I mean, because so much of the stock market is related to AI or speculative things that are sort of way out, sort of almost just not relevant to the economy. I mean, it's just growing so fast that a little weakness in other areas honestly aren't going to hurt it, but they are going to be helped by a rate cut. So it's sort of a win-win, even though there are some negatives about this treasurial drop.

7:49Yeah, yeah. How about the performance of airline stocks today? Big time outperformance. Look at the ETFJETS. Saw a lot of airline stocks outperforming today. We've got, you know, oil below$60 a barrel. Some of your airline stocks, Delta Airlines starting to come to life here, breaking out of a downtrend. You know, a lot of these stocks don't have great relative strength ratings, but seeing, you know, money start to flow into airline stocks and even the interest rate sensitive home builders, ITB, you know, definitely seeing money coming into the home builders. So starting to see money outside of, you know, outside of technology, you know, the healthcare space, that's been working for a while, XLV, checking in on some of the leading growth stocks.

8:46We've seen some leading growth stocks come under pressure, plenty more that are working, but FFTY still stuck below the 50-day moving average. We've talked about some of the former leaders like NVIDIA starting to come back, but still toiling below the 50-day moving average. AMD, another one that's been hit, that rallied, but still below the 50-day moving average. So seeing some outflows out of technology. ARK, this is the Cathie Wood ETF that is another proxy for growth stocks, starting to rally back, but seeing maybe a little bit of rotation out of technology. Yeah, I mean, just as a buying opportunity, they're not buyable yet.

9:33Some of them are moving fast. Like the strongest stock in the S &P 500 was Robinhood. I mean, it was a huge day. And obviously, if you had bought it, you'd be great. You'd be great. But, you know, it's buying below the 21-day line. Now it's above the 21, but it's still below the 50-day. It could hit resistance. It's already come up a long way. If the market comes into trouble, you know, this is going to dump very quickly. So it just becomes tricky. We generally want stocks, you know, you want to live above the 50-day line. I mean, not saying you can't, obviously, stocks go below the 50-day line, but generally, the odds are better if you wait until it's above that.

10:07So yeah, so there's definitely some movement there, but the things that are actionable are generally not those high beta names right now. I mean, there's some growth names, a lot of strong things, but just something, you just have to be aware of that. You just have to be aware that there's different times for different stocks and maybe these will come back, but there's other opportunities right now. Yeah, some will and some won't. But even though NVIDIA and Advanced Micro under some selling pressure, you still have SMH back above its 50-day moving average. That is really impressive. Breaking out of a little downtrend here, but I think you can have Broadcom to thank for that.

10:46That one went into an all-time high today, up 3%. They're doing a lot of work with, you know, Google parent Alphabet, which is big. And, you know, their in-house AI chip that is, you know, co-designed by Broadcom. So, you know, still seeing some pocket of strength in tech. And then your gold stocks, GLD, they took off again today, GLD up eight-tenths of a percent. But boy, I saw a lot of outperformance and a lot of gold stocks, a lot of top rated gold stocks in IBD's database did well today. GDX, I think, yeah, putting up GDX would be good because that one did much better than gold for whatever reason.

11:32And we're going to look at one, but there's a lot of gold names did well. I'd also take a look at Bitcoin. Again, this is way down. But if you're, you know, some of this is because, OK, yields are down. So it's happy. So to what extent is this rallying with other speculative names? To what extent is it helping some speculative names? I assume something like Robinhood is probably getting a boost because a lot of its business is crypto. But so Bitcoin coming back up is good, depending on whether or not it's just whether it's just in sympathy or a catalyst for things, because clearly that sell off seemed to be tied to the market pullback, especially in growth speculative names.

12:11Yes. But that one's still way, way down. Definitely, definitely. And a lot of downside volume as it pulled back. So, yeah, Bitcoin under some pressure, but a nice move, almost up 3 % today.

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12:57Well, let's take a look at some individual stocks. We were talking about the strength in the chip equipment group. Let's take a look at Netherlands-based ASML. L. This is a stock that had a nice breakout recently over the 800 level, came down to the 50-day moving average, and it is finding support. Let's go to the weekly chart here and see what a good test of the 10-week moving average looks like. Good test of the 10-week, first time since it sort of cleared the 800 area as sort of base. This is just a test of the 10-week line. you could also treat this little area as either a little consolidation or as a handle to a huge huge base so that works out well and again so this is one of the reasons why smh was up today obviously broad comes a bigger name but there were chip equipment names definitely doing well i think on a daily the only thing you could say is like it it went went off the 10-week line in the 50-day line it broke a downtrend the only thing you could say well if you didn't buy it now you might wait to get above today's high because it was really close to the high from last thursday didn't close above that.

14:07So again, you could have bought it today, but at this point you might wait till Friday or Monday and see if it can get just above that level since it's just a fraction at this point. Yeah, you can see it hit a high, closed off that high as it tried to poke above Thursday's high. So getting a little bit of resistance there, but still fighting a good fight here. That's ASML. That chip equipment group all the way up number 11. out of 197 groups ranked by IBD based on six-month price performance. So still seeing a lot of strength in the chip equipment group. Okay, well, we talked about a lot of strength in gold and silver stocks.

14:50Let's take a look at PAAS, which delivered a nice technical breakout today. Yeah, on a weekly chart, there's a small cup with handle, but you can sort of see it on a daily too without the patent rack. there's the handle yep right there so it moved up there the relative strength line's almost at a new high uh obviously it's been a nice run the revenue strong this is actually it actually produces a lot more gold than silver uh but today silver was up more than gold regardless either way this is playing this is our stock of the day honestly we probably could have picked half a dozen gold or silver names to be our stock of the day we have named some to be stock of the day recently uh so do it high gold prices, high silver prices.

15:34It doesn't take a lot of genius. You know, that really falls down to the bottom line. If you make 10 cents the profit on silver and silver goes up by 20 cents, all of a sudden you're making, you've tripled your profit. You're now at 30 cents per ounce. And so you can see how, why the miners outperform to the upside and downside so much. So just a lot of strong growth, strong technical move here. Just a lot to like here. annual earnings. I mean, just exploding here. Yeah, just exploding. The weekly chart gives you a slightly different perspective here, just on a nice uptrend. You had several down weeks in a row here, rallying back.

16:18Here's the cup with handle base. The stock making a huge move this week. Blue dot is just signifying a relative strength line in new high ground. outperforming the S &P 500 and clearly a stock showing great top line growth. Look at these forward estimates looking very strong, both in terms of the top line and the bottom line here. Big reason why it has a highest possible composite rating of 99, showing a lot of price strength and top fundamentals as well. So let's head over to energy, starting to see some expanding market leadership in the oil and gas space. It's not not in spades, but seeing a little bit.

17:08Let's take a look at Comstock Resources. And this is a company that is, I know, majority owned, I think 70 percent owned by Jerry Jones of the Dallas Cowboys, fast growing oil and gas producer. Again, they lost some money. That might have been just a one-time deal in 2024, but growth really expected to ramp up this year. And next, what do you see with Comstock Resources here? Yeah, it came off highs today, so that wasn't great. But it was sort of clearing the bulk of what is basically a messy handle. I mean, it never technically got there, I think, or maybe there was briefly. But I think today, if it got back to today's highs, you would think it's actionable.

17:52It just was a little disappointing to see it fall off a little bit. Some solid volume. It's made a nice move. Yeah, natural gas prices have been up a lot. This is a natural gas play, and natural gas has come up a little bit in the past few weeks. It hasn't been amazing. And that's just something with all these oil and gas producers. They're going to rise and fall on price. I mean, that's ultimately what it is. So there's always that risk. You never know when this weather forecast says it's going to be a warm winter. Nobody needs natural gas. And it's like, and then natural gas could fall 8%. So, but that in mind, there seems to be strong demand, just inherent, regardless of the weather.

18:33Because, yeah, everybody's talking about building nuclear and everything else. But honestly, natural gas is something you can get today. You know, that's something for these AI data centers. We're exporting a lot of natural gas to Europe and elsewhere. So there's a lot of outlets for demand that weren't there or seemed to be there a year or two ago. So there's reasons to think that these natural gas plays can have a strong run once again, set aside the daily weather shifts. I see. Yeah. This was a very interesting move when it ran through the 20 level here. You see as it rallied, look at all the volume here as it rallied.

19:13So you can see why it has almost the highest possible accumulation distribution rating of A. That has helped by a lot of heavy volume as it rallied. And then actually, as the handle area formed, volume really dried up, which was good to see. But as you noted, Ed, the price action was a little choppy. Typically, we do like to see volume quiet down and dry up as the handle forms. You almost like to see attention turn away from the stock. But the price action was a little choppy, maybe a little more volatility than we'd like to see. This one still has a chance, though, of breaking out, especially because of all the accumulation that we saw here.

19:57We'll just want to see it just eventually get over this high from Thursday. We look at the weekly chart here. This definitely has good fundamentals working in its favor. So we'll keep an eye on Comstock in the oil and gas exploration and production industry group. I would normally check with some earnings after the close. But I think with Thanksgiving tomorrow, we do have a half day of trading on Friday. So the market is going to be closed at 1 p.m. Eastern time on Friday. Ed and I will be working on Friday for a shortened day of trading, but we will be back just after 1 p.m. Eastern time for the Stock Market Today video.

20:49So slightly different cast of characters on Friday. So, Ed, I wish you and your family a happy Thanksgiving. You as well. Okay. Thanks a lot for your insight. And thank you for joining us. We appreciate it. I want to wish all of our SMT viewers a very happy Thanksgiving as well. We appreciate all of you. That'll do it for today. Again, stock market open a half day on Friday. We'll be closing up at 1 p.m. Eastern time. We will not be around for IBD Live tomorrow as we will be enjoying our turkey. and Friday we will be back for IBD Live. I think it's just going to be a slightly different host and panel.

21:40I believe Hat Man, Dave Chung, is going to be in the host chair. So we will see you on Friday. Enjoy your Thanksgiving. We're thankful for all of you. Have a great day, great afternoon, great Thanksgiving. We'll see you back here on Friday. Take care. Thank you.