Stocks Quiet In Year-End Trading; FTAI Aviation, Nu Holdings, Shopify In Focus

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0:23through. Good afternoon, everyone, and welcome to Stock Market Today. It is Tuesday, December 30th. My name is Ken Shreve. On today's show, we'll take a look at today's stock market. Tough day for small caps. Rest of the market, pretty mild losses. The second to last trading day of 2020 25. Let me bring in Ed Carson, our news editor. He's got three stocks to watch for today. Good afternoon, Ed. Good afternoon, Ken. I'd like to take a look at FTAI Aviation, New Holdings, and Shopify. All right. A rare breakout for FTAI today, so we'll take a look at that one. First, let's take a look at the stock market.

1:10Like I said, pretty minor losses for the Dow Jones S &P 500 and NASDAQ composite today. Most of the selling was concentrated in small caps today. So let's start by taking a look at the Russell 2000 today and take a look at the Russell 2000 today. That was down 0.7 % close below the 21-day moving average. Maybe we're going to get a test of that 50-day moving average for the Russell 2000. Take a look at the NASDAQ composite. This is going to be a close near the session low today, only down about two-tenths of a percent. You can see there Dow Jones industrial average, modest decline there as well, still holding above its 21-day moving average and the S &P 500 modest decline there as well.

2:08So, Ed, I don't know if there's any reason to explain the lagging nature of small caps today, but this does appear to be the lagging index at this point. Yeah, I mean, and it's not clear what's going on because other things, other breadth indicators aren't particularly weak. I mean, the fact is, other than the fact This is below the 21-day line. All the indexes that we're going to look at here, they're all pretty close to record highs, and they're all pretty close to their 50-day lines. I mean, even – so it wouldn't take much. And you could certainly imagine, like, you know, we enter the new year and some good news or bad news happens and, you know, whatever.

2:44You could easily see us going that way. I think the NASDAQ has more of that long range that we've had because that hasn't hit a new – didn't hit a new high like some of the others did in recent weeks. So we're seeing a lot of setups. So there's a lot of things that are setting up, but we just have to wait for it. We keep on going sideways or we get ahead fakes like the recent drop we had a few weeks ago or with the other indexes moving to new highs and then coming back down. So there's not, you know, especially at this time of year, not a whole lot of reason to take a whole lot of action with things.

3:16But just sort of, you know, holding on, building your watch list because a lot of things are looking interesting, but maybe not the time of year to be doing it. Yeah, well, we're coming into the end of the year. Volume dry up in the market, as expected, the so-called Santa Claus rally underway. We haven't seen the Santa Claus rally yet. We've got just a little more time left to go until the end of the year. We had breath today decidedly weaker on the NASDAQ than the NYSE. Take a look at the equal-weighted RSP today. That was down mostly in line with the S &P 500 today. RSP down just close to two-tenths of a percent.

4:02QQEW, that was down modestly as well. Four-tenths of a percent, maybe a little worse than the NASDAQ 100. Let's see what the NASDAQ 100 did today. That was down a little bit less than QQEW. We did see, Ed, some selling in, let's see, biotech space today. XBI took a hit today. That was below the 21-day line, but pretty stiff selling in the biotech space. XBI down 1.4%, but when you look in the IBD50, market surge growth 250, a lot of your leading biotech stocks took pretty good hits today. maybe some profit taking. Yeah. And for a few days too, it wasn't usually that there were massive losses, but some of these have had two, three, 4 % losses over, or maybe like six, seven, 8 % over a few days.

4:53And that adds up. I mean, so in, you know, the second week of January or like January 12th to 14th, there's a huge JP Morgan healthcare conference. A lot of biotech healthcare companies will speak for it. There'll be a lot of pre-announcements. There'll be mergers, a lot of stuff going on and you know so this has gone on a big run uh but you know so it's something watch i mean this is something like maybe it could set up again but uh yeah pulling back right now and then uh gold stocks we had uh boy that really sharp drop for gld uh yesterday you can see that bad break it was down more than five percent uh yesterday not much of a rally today we did see gold stocks outperformed, but not much of a bounce today, Ed, for GLD.

5:40Looks like it ended with just a gain of not even one-tenth of 1 % after a sharp drop yesterday. So we saw gold stocks outperform, some individual gold stocks outperformed, but a pretty feeble rally attempt after that sharp drop yesterday. Yeah, I mean, few gold futures which closed earlier rose 1%, but that still wasn't much, but silver and copper had nice bounces. I mean, silver really came back. The futures were up. Actually, the futures were up 10.5%. So as you can see, silver, SLV, the ETF closed off at lows, where I don't think silver futures probably closed at lows. So that's part of the reason why there's that, but still big recovery there.

6:22Obviously, it's gone on a huge run. I mean, this is really extended. So, I mean, it's not something that, I think most investors will want to wait to see something set up again. And the gold miner ETF, GDX, had a little breakout here. You can see this breakout right in this day here. Came down, retested that buy area yesterday. Found support at the 21-day moving average. Still holding in a buy zone, GDX. We'll see how gold fares as the calendar turns into 2026. So gold still outperforming here. And I think I'm going to be writing the big picture after we wrap this video. And, you know, as the calendar turns into 2026, Ed, I think we're going to get a pretty good idea of market direction first few weeks of January once volume starts to pick up and these institutional investors come back from vacation.

7:19But a pretty good bet that as the volume starts to pick back up in the market, we get a pretty good idea near term of which direction this market wants to go in the early part of January, wouldn't you think? Absolutely. Yeah, yeah.

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8:03All right, well, let's take a look at a good breakout today. Not really seeing much in the way of breakout activity, but FTAI, there was news that lifted this stock. You guys were talking about it on IBD Live earlier today, FTAI Aviation. FTAI is the ticker here. Beautiful breakout over a 184.12 buy point. Interesting news here for this aerospace and defense stock. Yeah, maybe it'll change its name to FTAI AI. It's this jet engine repair shop. I mean, and some other things is like, they're going to create a new division that will specifically convert jet engines into turbines to power, for electricity power generation, given that there's such huge demand from AI just and pushing up energy demand overall.

8:55So, I mean, presumably jet engines aren't the most efficient form and size for like generating electricity. I mean, I'm just going to throw that out. But in the current environment, rates are so high and demand is so high that that makes sense. And I could imagine other companies doing that. Why not jet engine makers just sort of, I mean, you know, doing that. But this one had a powerful move. It'll be interesting to see how the market responds to this. Like as analysts say, hey, yeah, I think this is great. It's going to go to the moon or others saying, oh, this, there's a lot less to this than meets the eye.

9:27I have no idea. I mean, I'm, this is, this is fascinating, but look, the market loved it. Really powerful volume. I mean, just blast it out there. It is, it is going to, it appears something that can be transformational for the business. Let's So that just changes it so dramatically from becoming a mechanic shop to becoming an AI play overnight is something that is pretty interesting. This is interesting because this is a stock that trended very, very well here. Look at this strong uptrend the stock made from 50, ran all the way up to 180. And then it just sort of consolidated and based and corrected from.

10:08There was a short seller report in there, that big drop. That was part of that. And so it took a while to come back from that. It took a while to come back and then it started working its way higher. Now, just now, it's starting to come out of this big, long base here. So definitely a bullish move for FTAI Aviation. You can see this even before this news came out today, the annual earnings for this company really, you know, were expected to ramp up anyway. Anyway, so potentially game-changing news today for FTAI Aviation. I think it's important, the fact that it has such strong growth earnings, and I don't know if anybody was predicting something like this, but probably not.

10:49That tells you what opportunity they see. I mean, it's just like the opportunity cost is to be using this, repairing these jet engines for what they were doing, and they were making a lot of money off of that. So the fact that they say, hey, this would be a lot of fun to do this is just a positive sign in and of itself. How ironic that they have AI in their company name as well. That's right. Okay, let's move on and take a look at a Brazilian fintech named NU, a company called NU Holdings. They're a Brazilian company. Like I said, this is an interesting technical setup. It has a composite rating of 96.

11:32Anytime a company has a composite rating of 96, we typically know it's showing strong price performance, but we also know the fundamentals are probably pretty good as well. And look at the bottom line and top line growth here for new holdings. Hard to find a financial stock with better growth than this, Ed. Yeah, nice. Because there's a lot of people that don't have a bank. So there's a lot of open opportunity for a new bank. It's, you know, in Brazil. And obviously, it's delivering. You know, it's going to have a new flat base after this week on a daily. So you can sort of see it's at the top of this long consolidation, you know, arguably, that that's really been a consolidation for all year.

12:12I mean, there was another little base in there, but it just barely. So it's still in buy zone from the last base or so that we had. But you could say that on a daily chart, it's just getting above short-term highs. And you could argue that it's sort of breaking a downtrend or, you know, of, you know, kind of in there from an emergency base that will be there, you know, last, you know, next, at the end of this week. So it'll have another flat base. So definitely could do that. I would say is that one thing is that this has a tendency to, it has had a tendency to when it would get over certain levels to fall back down.

12:48That is a danger. When it hits new highs, that it comes back down. And sometimes in an unpleasant fashion, it's not a little graceful decline. Again, if you go back to a weekly, I mean, you can see it just not the last month or so. It had some some sell offs. But there's been some times where it gets up there and then it really falls. And so now maybe now the earnings the earnings line has been very strong. It's gone sideways for a while. This is sometimes you like, OK, an ugly looking giant base. Well, now it's sort of paused tightly relatively. relatively uh maybe this is the time for another big move and if you can get a nice big move out of it and there's some volatility i'll take a it's easier to handle volatility when you're already up 20 and it keeps on trending up uh so i think it's i think it's definitely one to be looking at i just want to caution people that does have a history of some ugly reversals just when everything seems to be working well yeah maybe uh maybe a stock like right right now just a nice pullback to the 10-week moving average here looking looking very very strong new holdings a Brazilian Brazilian bank with outstanding fundamentals okay let's come back to the states and take a look at Shopify a weekly chart here SHOP this is a company that helps a company that basically helps people We'll set up their online e-commerce stores, Shopify, several up weeks in a row.

14:17It is on pace for a weekly decline. This week, this looks like it could be maybe a handle forming, a cup with handle base. What are you seeing in Shopify here, Ed? Yeah, on daily, I think it is a handle base now after today. The number might be slightly different. I didn't look to see. So it's setting up there. And just to say, it's coming back to the States. This is technically Canadian. So if you want to call this the 51st state, but I bet most of its revenue is here in the U.S. It is a Canadian company, though, correct. Yeah. And they're doing some expansion. They're doing some more to enterprise and some more international stuff.

14:56So that's helping drive it. I mean, there is sort of weird stuff. And it's sort of weird. The last couple of quarters, they don't release GAAP, their earnings number, in the initial release. They have to sort of tell it later on. So it's a little odd. The earnings have fallen off. The revenue growth has been solid. It picked up the last couple of quarters. This one's still doing some solid growth. But yes, I think if it gets after today, it should show up on a market surge chart that is on the daily. After Friday, presumably, it'll be there on a weekly. So move above those levels seem like that's a clear entry.

15:28It's nice to get, I think, a shakeout because you go up and up and out. It's just nice to get some clear pullback. And then if it does move higher, then you can feel more comfortable with that. The left-hand side of the base wasn't the greatest, but I think this is definitely one that can go on some big moves. I like the fact that the handle isn't too far from the 50-day line because it often seems to make these moves off of those levels, and there's volatility after it makes a big move. So it might be easier to hold from that kind of buy point. Looking good. Looking good. Good. All right. Well, that is Shopify and looking pretty good.

16:07Ed, I appreciate that very much. Thanks, as always, for your insight. All right. That's going to do it for today. We appreciate you watching as usual. I will be hosting IBD Live tomorrow morning, and we're going to have Rachel Fox back from a little time off. So we'll look forward to having Rachel on the show tomorrow. If you haven't checked out IBD Live yet, you can go to investors.com forward slash IBD Live. Ed and Alexis will be back for the stock market today. Tomorrow, it is going to be the final trading day of 2026. It's going to be a full day of trading on Wednesday. The market will be closed Thursday for New Year's Day, and it will be a full day of trading on Friday.

17:01That will do it for today. Thanks very much for watching. We'll see you back here tomorrow.

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