Stocks Pare Strong Early Gains. Google, FTAI Aviation, Nvidia In Focus.

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0:40good afternoon everyone and welcome to stock market today for wednesday october 15th right in the middle of the month of uh october my name is uh ken shreve i'll be joined in a bit by our news editor ed carson with the stock market today uh video uh appreciate you uh joining us and um Let me bring Ed on. We had the NASDAQ gave back some early gains today. It was up as much as 1.4%, but another day of outperformance for small caps. Ed, you've got three stocks to watch. What do you got for us? Yeah, Google Parent Alphabet, FTI Aviation, and NVIDIA. They all flash buy signals at least at one point during the day.

1:22All right. Well, we got two of the magnificent stocks in there. Let's start by just taking a look at the major stock indexes, and I'll pull up, as I always do, a chart of the NASDAQ composite here.

1:41Okay. And we can see the NASDAQ was up 1.4 % today, closed off its highs right in the middle of its range. Market is still just trying to work out this bad reversal that we saw on Friday. But the price action in the market since then has been pretty good. So the NASDAQ today up 7 tenths of a percent. S &P 500 also gave back some early gains, closed in the bottom half of its range. You can see right here. Small caps outperformed again. We'll take a look at the Russell 2000, which hit an all-time closing high yesterday and another all-time closing high today. So small caps continuing to find a bid in the market here.

2:39And the Dow Jones Industrial Average actually was slightly lower near the close. It did reverse slightly lower. Looks like it's down about one-tenth of 1%. Let me go back to the NASDAQ, Ed, and just get your thoughts of where we're at. Again, that big downside reversal on Friday caused a lot of growth stocks to stumble. Didn't see too many sell signals, but the market's action since then has been pretty good. So I don't know that we can say that this bull run is over yet as the NASDAQ holds above its 21-day line here. Yeah, it remains volatile. So if you go to an intraday chart, I mean, because we rose 1.4 percent, then we briefly went negative and then rallied and then faded and then had a strong bar at the end.

3:27But it's just a difficult environment for buying new stocks. But, yeah, I mean, we're still in the range of Friday. All the major indexes are now above their 21-day line. So it's not like one good day and we could be at record highs. One bad day, we could be back below the 50-day line. So there's that. So it's just, I think it's still a time to be significantly invested, maybe heavily invested. But new buys are tough because, you know, we'll look at some stocks that actually sort of held most of their gains. But there were definitely others that faded off. Either pairing gains are coming off and it just makes it tricky.

4:04But, yeah, still the environment is fine. It's hard to get upset when you just have a couple of days drop and you're holding like 1%, 2 % from all-time highs. Yeah, yeah. Yeah. Well, we did lower our exposure Friday when we had that market sell off. We did have an invested percentage of 80 to 100 percent. We lowered that to 60 percent to 80 percent. There may be some growth investors out there that are closer to 80, maybe some even higher than that, that have some of the big leaders that aren't flashing sell signals. One thing about the The NASDAQ composite is where the 50-day line is sitting right at this 22 ,000 level here.

4:45So this could be a pretty significant support level to watch. NASDAQ would need to pull back almost 700 points from here to test that 22 ,000 level. But interesting to see it holding right at that 22 ,000. 11. At small caps, I assume they're charging higher, benefiting from a lower interest rate environment. That 10-year Treasury yield today touched 4%. Exactly, it looked like. You can see that right here. 4%, pretty good support level for that 10-year yield. Still looking at the Fed. The Fed has kind of taken a backseat now. We have the China trade barbs going on between President Trump and President Xi.

5:43But that 10-year yield is still holding around 4%. What's the rate outlook right now between now and the end of the year? What's the Fed expected to do? Yeah, the last few days, the rate cut outlook has – really, the bets have really become locked in for October and even December. Fed chief Jerome Powell had an opportunity to push back at rate cut expectations. And he really didn't talk about rates, but he sort of said things are similar to what they were in September. Well, you know what they did in September? They cut rates. So that, you know, again, if Powell wanted to push back and provide himself some leeway, yesterday was a good day to do it.

6:21Not that he can't change his mind, not that Fed can't. But if you're going to do it, you know, you want to do it to give the market as much time as possible. I think that's one reason why it's reinforced. Small caps really benefiting from that. And gross stocks doing quite well. Even though the NASDAQ had an okay day, definitely, you know, gross stocks had a strong day. It was uneven. There were some that fell. But generally, really strong performance there as well. Market breadth positive today. Positive by less than 2 to 1, but still nicely positive on both exchanges. Bad break for the RSP. This is the S &P 500 equal weight ETF.

6:58S &P 500 is a market cap weighted index, but RSP is an equal weighted look at the S &P 500. Bad break of the 50-day moving average, like I said, Friday, but is battling to reclaim it. Closed off highs today, but still looking pretty good. And then the equal weighted QQEW still looking strong, holding above its 50-day moving average. Growth stocks continue to be AI stocks and growth stocks in general continue to shine. FFTY has got just a beautiful, beautiful relative strength line up near new high ground. It's another all-time closing high today. So growth stocks continue to outperform. A lot of chip equipment stocks among the best gainers, at least for a while today in the NASDAQ 100.

7:53SMH still holding strong above its 21-day moving average near highs. And XBI, XBI is the biotech ETF that we were talking about some biotechs on IBD Live this morning. And seeing a lot of biotech stocks coming to life. So you've got the AI stocks that continue to march higher, but biotech's starting to look good here. So leadership does seem to be broadening out a bit. Yeah, there's a fair amount of opportunities out there. And the thing is, I mean, some of them working, some of them, first thing, makes it a little tricky. But investors should definitely be taking a look and looking around not just the same names.

8:35And, yeah, this is strong performance. And that's something you want to get. But to get something that's diversified from AI, but showing relative strength, that really can be impressive. So nice action here. This podcast is brought to you by MassMutual. For 175 years, MassMutual has been there for policy owners, financial professionals, and communities through economic shifts and societal change. In a world that changes fast, strength and stability still matter, especially when it comes to helping people secure their future and protect the ones they love. Learn more at MassMutual.com. That's MassMutual.com.

9:16Absolutely. All right, well, let's start by taking a look at Google. I mentioned you have two Magnificent Seven stocks for us. So Google, arguably one of the better looking Magnificent Seven stocks at this point. You can see it recently hit a high of 256. It basically came down nice, tight sideways consolidation, finding support at the 21-day line. Looks like this could have been an early entry for some traders. Just talk about what you're seeing in Alphabet's chart right now. Yeah, you could have done early entry from a couple of ways. a downward sloping trend line from 256 or just a short-term high that was right around 250.

9:57Either way, it crossed that level. Yeah, this has been doing quite well. The pullback came on lighter volume. And today's action wasn't on tremendous volume either. But, you know, this had a really strong advance. I think some of the concerns that AI would destroy the search business just haven't come to fruition. I mean, not saying it can't eventually. But that's one reason why it's had a really good run from 140 to 256. Yes, the market has had a good run, but especially in the last few months, the relative strength line has been quite strong. When it first broke out, maybe around the 180 level, the relative strength was a little bit of a laggard, but it came on.

10:34It just kept on going. So I think this is a place you could buy or maybe as an add-on entry, a little safer than some of the others. Not safe. And there will be earnings in a couple of weeks. That'll be a big earnings report for the market. But yeah, I like the way this one acted today. Third quarter earnings season off to a pretty good start. We had some nice reports in the financial sector yesterday from Wells Fargo, J.P. Morgan, Goldman Sachs. Today, it was Morgan Stanley, Bank of America. So financials looking pretty good here. And like I said, getting earnings season off to a good start. Alphabet still a couple of weeks away.

11:17We'll be really, really busy towards the end of October, but we'll start to pick up the pace next week. We have Netflix and we've got Tesla as well. And then a big earnings report tomorrow morning, Ed, with Taiwan Semiconductor, the world's largest chip foundry. This is Taiwan Semi Reports tomorrow, and this has been an incredible performer in the semiconductor group. Yeah, real big bounce this week. And yeah, it makes chips for basically everybody. So its guidance, its capital spending guidance will be very important. So really strong action here. Yeah, so it's just been tremendous performer here.

12:02And it's had accelerating growth. That's probably going to slow down as the comparisons get tougher. But a really, really important report tomorrow morning. Impressive customer list for Taiwan, Semi, Apple, Broadcom, AMD, Qualcomm, you name it. Just a lot of high profile customers. Let's go over into the airline leasing area, a name that has been really just an outstanding stock for a long time. Let me just start by looking at a weekly chart for FTI Aviation, and we'll see how well this stock did in 2023 and through 2024. Big market winner. Came into a big pullback here, big shakeout. This did serve to shake out sellers in the stock, but now over the past three or four weeks, making a solid test of the 10-week moving average, Ed.

12:59Yeah. I mean, you could get a 10-week line there. You could treat this as a short consolidation or as a high handle to this long situation. I mean, there was a breakout a few weeks ago or a couple months ago, maybe around the 140 level or even before that. Yeah, a couple of places you could have got into it. But it was a really wide and loose base. And so it's sometimes nice. Sometimes it's nice to wait to see if they're going to tighten up, provide another entry right at the top of the base, just above the base. That sort of seems like what it's doing on a daily. it broke the downtrend of a short of this short consolidation slash high handle.

13:35You know, so you could you could have used that as an entry. It did come off highs, but it held most of the gain. That's the thing. It's like there's also the short term highs that it's basically closed right about at. So the bounce off the 10 week line, rising above the 21 day line, breaking a trend line. Those are all offering reasons to do it. Obviously, earnings, I think, are coming up. I didn't confirm that, but earnings are probably coming up pretty soon. So that is something to note. But yeah, I mean, it's a big rebound after strong growth is expected next year as well. Yeah, the earnings are going to be tremendous because of some easy comparisons, but then it's still supposed to be really strong next year.

14:09Yeah. And again, a composite rating of 96 here helped in part by huge revenue growth. Look at the revenue, year over year revenue gains here for FTAI, very, very solid, kind of a choppy record of earnings, but you can see third quarter earnings expected to be up 63%, and that growth is expected to continue in coming quarters. That's a look at FTAI Aviation, ticker FTAI. And let's conclude by taking a look at NVIDIA, which was looking quite vulnerable yesterday. Switch on the daily look here. And NVIDIA was a – there we go. NVIDIA came down and tested the 50-day moving average yesterday, tried to bounce, but sellers knocked the stock down near lows.

15:02Not a broken stock yet, but maybe looking a little tired here. Yeah, it came right above the buy point of$1.40,$1.84,$1.48 at the open. Like really in the first minute, it was back below. And it came off and it didn't bounce. It didn't get up. It did hold the 50-day line, so it hasn't closed below that. And it really isn't far from being back at the buy point. But there's also the fact that all the other chip makers, including NVIDIA chip maker Taiwan Semi, but AMD, Broadcom, those names are all doing very well. A lot of the chip equipment names, as you were mentioning, they're doing well. NVIDIA is not.

15:37Now, there's others that are not doing particularly well, like A-Lab and some others, but NVIDIA is this giant. That doesn't mean, of course, NVIDIA goes through these periods, but, you know, the fact that all the other, a lot of the other big chip names are running and this one couldn't even bounce at all, that's just a little troubling. It's just something, and honestly, we saw this with a lot. I mean, you could have been understood, this is one reason why we wait, but you can understand, oh, it's back above a buy point, chips are moving, I'm going to get into NVIDIA. And then, you know, by the end of the day, you know, you're down 3%, not the worst, it's not broken, it could bounce right back.

16:07But that's, there was a lot of names you could have done that in. And some of those closed up, but you still could be down 2%, 3%. And that's no fun. No fun to immediately come down on it. It just makes it tricky. But, yeah, so it'll be interesting to see how this moves on Taiwan Semi. But clearly, NVIDIA is a laggard next to a lot of these other names. I mean, the threat of competition, how that can go, will that swing around? Is there going to be demand for NVIDIA for a while? Yes. I think it's more like, oh, what's going to happen late next year or 2027 and so on. It's not like everybody knows that people are buying a ton of NVIDIA chips now.

16:42That's not the issue. But that would just be something. Can it still grow really strong and consistently well into next year, I think, is probably more of the concern than anything short term. Makes a lot of sense. Makes a lot of sense. I mentioned tomorrow morning an important earnings report from Taiwan Semiconductor. Ed, like you mentioned, it is going to be important to hear what the company is saying about capital expenditures. Are they still seeing incredible demand? So this will be an important earnings report for the market. So let me stop the share here. And this is the time where I thank you for your insight, Ed.

17:30Appreciate you joining us as always and have a great rest of the day. Thanks. All right. Thanks very much for watching today, folks. A reminder that we'll be doing IBD Live tomorrow morning. Rachel Fox will be in the host chair and we're excited to welcome back Brian Shannon. He's a popular guest. He'll be on Friday with Justin Nielsen hosting the show, the Stock Market Today video. Tomorrow is going to be handled by Ed and Lexi, so we'll look forward to that. Until then, have a great afternoon, everyone. Thanks a lot for watching. We'll see you back here tomorrow. Thank you.

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