Techs Keep Selling Off In Split Market; Bloom Energy, Eli Lilly, Apple In Focus

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0:40Ken Shreve:Good afternoon, everyone, and welcome to Stock Market Today for Wednesday, February 4th. My name is Ken Shreve. Joining me on the program today, our senior markets writer, Ed Carson. We have a lot to talk about in today's market, a split market again with blue chips outperforming. performing another tough day for tech stocks before we get to all of that ed has got three stocks to watch what do you got for us today ed yeah deeply divided market today i want to take a look at bloom energy eli lily and apple bloom energy eli lily and apple three good choices there let's uh take a look at the indexes like we always do and uh i think we should start with the dow Jones Industrial Average.

1:24Ken Shreve:And let me see. I got to find my chart here. I don't know where it went. Sorry, guys. One moment here.

1:38Ed Carson:You know, there are days that are narrowly divided. This is one of those deeply divided days. And the market's deeply divided just to fill the void, as I like to do.

1:47Ken Shreve:So, yeah, I'm sorry here, guys. I don't know what happened to my chart. Let me just pull it up here. So let's start by taking a look at the Dow Jones Industrial Average here. We did have a nice day for blue chips. The Dow was up 0.6 % and I did see a whole bunch of Dow Jones stocks up at least 2%. I know Amgen had a big day today. That was a breakout for Amgen up 8 % on the day. A great day for Apple as well. That stock was up a big day for Apple. That stock was up 2.6 % traveler. So good day for blue chips. But real story was the NASDAQ composite. NASDAQ had a tough day. That was down 1.5 % volume, picked up the pace again.

2:36Ken Shreve:We've had a big clustering of distribution days on the NASDAQ small caps. Take a look at IWM. That was down as well, down 0.8%. And the S &P 500 kind of clinging to its 50-day moving average here, down 0.5%. It is holding support. So interestingly enough, Ed, the S &P 500 breadth was positive for the second straight day, about three to two positive on the S &P 500, breadth negative on the NASDAQ by less than two to one. So the S &P 500 and NASDAQ, kind of two different indexes at this point.

3:23Ed Carson:Yeah, it really feels like two different. It depends on which way you look. Like it's sort of like, it's one of those days where it's all stormy and cloudy in one direction, but it's still sunny the other way. Then one of those kinds of things, a lot of the market looks great, But the NASDAQ does not. The S &P is sort of a mix of the two. It's sort of on the edge. One good day, and this is right at record highs, one bad day. And not only are we through the 50-day line, we're at 2026 lows. So it just makes it difficult. I don't like divided markets because I feel like it's like an uneven floor or a floor that's moving around.

3:57Ed Carson:I don't feel like I know where things are going. I understand what a bad market is. I understand what a good market is. I can even deal with a sideways market to some extent. But this is weird because I'm getting I'm getting ghost signals. I'm getting, you know, stop signals. So it's not clear what's going to happen. Obviously, tech looks terrible. We saw the broadening out. Software actually wasn't terrible today. There were definitely some bad software names, but ships got hit hard because of AMD. And it felt like a lot of AI infrastructure stocks and just high beta names in general sold off, like space stock sold off.

4:32Ed Carson:You know, it just seemed like if you were a big winner, there were a lot of 10 % losers out there. So just a difficult environment. You know, it's not necessarily a bad environment, depending on how you're trading. But I would be very careful with tech and probably not to make a lot of moves in terms of buying, given the current situation.

4:58Ken Shreve:Yeah, the VanEck Semiconductor ETF came down to its 50-day moving average today. You mentioned an earnings sell-off for AMD. Here's the VanEck Semiconductor ETF. That was down 3.9 % today. AMD, not a good day at all. The numbers were good again in their guidance for first quarter, at least in terms of revenue, was above expectations. You can see a bearish gap down for AMD today, down 17 % on the day. But we do like to look at RSP. This is the equal-weighted version of the S &P 500 RSP ETF. This is a pretty bullish-looking chart here. It looks like an all-time closing high for RSP today, up 0.9 % on a day where the S &P was sharply lower.

5:49Ed Carson:Yeah, I mean, RRSP, record high. Yeah, exactly. The Dow looks fine. RRSP looks fine. I mean, RRSP looks great. So that makes it so difficult. It makes it really a challenging market. That looks completely different from what the NASDAQ or especially some of the growth ETFs look like. Some of them just look terrible. And again,

6:12Ken Shreve:in the Dow Jones Industrial Average, I saw several stocks in the Dow. I think close to 10 stocks that were up at least 1 % late in the day, and there were several that were up at least 2%. So the Dow Jones Industrial Average up near all-time highs as well. So tech, not necessarily a great place to be right now, but when you look at the 11 sectors tracked by S &P at least late in the day, seven out of the 11 S &P 500 sectors were up, and only four were down. So tough day for the NASDAQ, but underneath the surface, there were a lot of sectors that were up today. Energy was doing well again. Materials, real estate, health care, consumer staples, all were up today in the market.

7:01Ken Shreve:So not a good day for tech, but plenty of other areas were working in the market today. Another bad day for Bitcoin, Ed. Ibit just cannot escape the selling. This is the Bitcoin ETF. I bit down another 4 % today. Bitcoin having a tough time lately. XLP, this is one of the S &P 500 sectors I mentioned that had a very good day. Consumer staples up for four days in a row. Consumer staples are still finding a bid here. XHB, another S &P 500 sector homebuilders getting a bid here, starting to do well. Three up days in a row for XHB. And gold and silver stocks had a good day today up for the second day in a row after some volatility.

7:57Ken Shreve:XLV kind of trading near its 50-day moving average. Excuse me. This is the health care that outperformed today. XLV, the health care ETF. FxLV kind of straddling the 50-day moving average. So did have a lot of earnings reports before the open. We did have not such a great reaction to earnings by Novo Nordisk, NVO yesterday. They reported earnings a little bit earlier than expected. But let's take a look at Eli Lilly, which had a...

8:36Ken Shreve:across desktop, web, and mobile. For faster trades anywhere you go. Try the all new Fidelity Trader Plus. Learn more about our most powerful trading platform yet at fidelity.com slash trader plus. Investing involves risk, including risk of loss. Fidelity Brokerage Services, LLC. Member NYSE SIPC. Very nice response to earnings, LLY. This is a stock that was a little bit kind of back and forth early in the session today, but it did strengthen. You can see the sell-off yesterday in response to Novo Nordisk's earnings, but Lilly ended up having a nice day here, up more than 10 % in very strong volume.

9:18Ed Carson:Yeah, this was great. I mean, there was a downward sloping trend line as it sort of pretty, not too far above the 50-day line. There was also a short-term high. You could sort of treat this as a mini double bottom, And it got above the middle of that. So those were two places you could have bought today. Again, you know, as this day went on, did you really know that this was going to hold up? I mean, it's just even though, yeah, there was a lot of good things going on, but hey, AMD fell 17 % and had strong earnings and guidance. So it wouldn't have been shocking if this had fallen 3 % by the end of the day.

9:52Ed Carson:I mean, that's just the kind of day conceivably. But it got above a couple of early entries, just really powerful growth. Again, showing how financially it is doing so much better than Novo Nordisk. You know, I didn't hear any word about their upcoming weight loss pill, but that will probably help and just continue to solidify their lead in this market. And yeah, there's changes going on, but it's the dominant player in this absolutely enormous field.

10:26Ken Shreve:Yeah, you can see fourth quarter earnings up 42%,$7.54 a share. revenue up 43%, 19.3 billion. Sales of Manjaro, their diabetes treatment, strong revenue there, and ZepBound, which is their weight loss treatment, triple digit revenue increase there as well in NQ4. And you mentioned their oral weight loss pill expected to receive FDA approval probably sometime in the spring, call it, April sometime in that area. So we will see. But nice response to earnings from Eli Lilly and not far from all-time highs here. And you can see so far this week, nice weekly gain for Lilly so far this week, up close to 7%, very near all-time highs.

11:24Ken Shreve:Let's take a look at Apple. Just took a look at Apple, one of the big gainers in the Dow today and recently reported. strong earnings and a really bullish move back through the 50-day moving average. So not seeing a whole lot of good news in tech, but Apple is actually a rare bright spot in a beaten down tech sector, Ed.

11:49Ed Carson:Yeah, the last several days have been strong overall. I mean, really good moves, some strong volume. There was one down day that wasn't much when the down, and, you know, Rella's strength kept on improving on that day. You know, I think you could argue this was actionable here, or maybe even if you got above the 277 level. But, you know, it's clearly about the 50-day line, whereas the prior two days it was just above. So I think today you could have bought it off of that or maybe wait for this. You know, the growth has not been tremendous, but you have to give it credit. It's got three quarters of accelerating earnings growth.

12:22Ed Carson:It has, you know, generally trending higher sales growth. Now, they did say we cleared out all our inventory because we sold so much, especially in China, that they don't have enough iPhones for this quarter. But that's not the worst problem to have, I think, when people were worried about it. And so, yeah, that was impressive. You know, again, how long can it go? It obviously ran out of steam a while ago. But, you know, now with earnings, that's out of the way. This is doing quite well. And the Artrello Strength line is back above its moving averages. So after lagging for a while, it's definitely taking a positive turn over the past couple of weeks, even before earnings.

13:00Ken Shreve:No doubt. No doubt. And here's the weekly chart for Apple. Slightly longer term perspective here came down from the left side of a base and is now working its way higher. So sometimes as the stock approaches a prior high, sometimes it can drift lower here. So maybe we get maybe actionable here right now, but as it approaches its prior high, sometimes a stock will drift lower and maybe get an alternate entry here. So Apple, a good one to watch to see if it starts to drift lower, but definitely some newfound buying demand for Apple stock. Finally, let's take a look at Bloom Energy. BE is the symbol here.

13:43Ken Shreve:And wow, what a volatile day for Bloom Energy. This is a stock that I used to own. I got out of it today due to the volatility, but it did firm up near the close at its 21-day moving average. We're going to hear from Bloom Energy tomorrow. They report earnings. Really nice price performer, but boy, this stock was down close to 20 % in one day. It ended with a loss of close to 13%. But again, health support at the 21-day line. Really a good growth story here. but volatile and held support at the 21-day line. What do you see with Bloom Energy, Ed?

14:22Ed Carson:Yeah, and this is why I wanted to show you for a variety of reasons. One, it was a big sell-off around, well, if you treated this as a cup base when it got above the top, you lost all the gains. I mean, if you bought there, you're down. If you bought at the double bottom buy point or was it bounced clearly above the 50-day line, you're still up and you could have kept it. You could sell it or you could take some partial profits. But this is a volatile name. You have to be ready for this. You look at some of the names. People would ask about this on iBD Live sometimes, and some of these other names don't look as big.

14:51Ed Carson:But this has a daily average trading range of like 9.5%. So when this stock falls 7%, tomorrow it may jump 7 % intraday. It'll be an inside day if that's the case, and easily an inside day. I mean, I don't know what it's going to do tomorrow, and then, of course, it's really earnings. The fundamentals are great. We love it. A lot of reasons to love it, but you just don't know. And this was a day when we saw stocks like Bloom Energy and we saw comfort systems fix. Stocks that were doing well, they held up well even yesterday. And today they did not for whatever reason. And, you know, so it was the tech weakness spread from software to clearly into the AI infrastructure kind of place for whatever reason.

15:37Ed Carson:And again, it would not shock me if these names rebound. And there's some news tonight that might be seen as positive for these infrastructure firms. But, yeah, you have to take it just to realize there was something different today in the tech selling, even though much of the market was great. So, again, I keep on needing – I need to be like Shiva. I want to have so many other hands in a day like today, like the other hand, the other hand. But definitely watch this one. But, yeah, this one could move a lot. This one could easily move 20 % on earnings. I don't think that would be a shocker to anybody.

16:15Ken Shreve:Oh, yeah, yeah. High average true range, like you said, a stock that definitely is known for volatile price swings, no doubt. about it. But a company, you can see the annual earnings estimates here, was losing money for a period of time. They turned their first annual profit in 2024. And then look at the growth expected for 2025 this year and 2026. Big, big growth expected for this alternative energy company that is big in fuel cells. That's Bloom Energy. All right, Ed, well, we've got a pretty, We've got one big high-profile earnings report after the close I know we want to touch on and some other interesting reports as well.

17:00Ken Shreve:So why don't we take a look at Google Parent Alphabet, G-O-O-G-L. I know they reported results. Let's take a look.

17:10Ed Carson:Yeah, they beat views on EPS and revenue. Not a crazy amount, but they beat views. They also beat on the Google Cloud, the cloud computing. I didn't look at all the other details. But the real news seemed to be this, at least on the headline, is that their capital spending was jaw dropping. I mean, way beyond what anybody was expecting. I saw that apparently they spent$91.5 billion in Q4. The estimate was like for like$28 billion. And the 2026 guidance,$175 to$185 billion versus estimates are like$119.5. So this is actually holding up pretty well, given that that presumably is going to be something that, you know, that they really need to have growth to make that work and everything.

17:52Ed Carson:So this held above a buy point at the close. It looks like it's still trying to hold in there. You know, it has been swinging around. This could be positive for all those AI infrastructure firms because they're spending a ton of money, you know, so that would be something to watch for to see if we get a bounce back. But that's a move. One that's a loser is coherent. I don't know what's going on.

18:12Ken Shreve:One thing I would say about Alphabet is that they really just – it seems like at least with this fourth quarter news is that they really seem to be ramping up the pace of their spending because you look at third quarter, second quarter, first quarter, at least the pace of their spending hasn't been nearly as quick as at least what they're pointing to, what they're saying in the fourth quarter. They really seem to be ramping up the rate of spending it seems.

18:33Ed Carson:It does seem like it. And I know Microsoft spent a lot more than they expected as well, but this one is jaw-dropping even from that perspective.

18:42Ken Shreve:But this was initially a really sharp downdraft, so the stock does seem to be coming nicely off-low. So we'll see. After hours can be volatile, but the stock does seem to be nicely off-low. This is a leaderboard model portfolio holding. We've had it for a long time. So nice to see it off lows so far. What else we got, Ed?

19:09Ed Carson:TTMI, TTM Technologies. This beat views pretty narrowly on EPS, it looks like, but sort of solidly on revenue. I don't know about their guidance, but this one is doing well. This one's up. I mean, it sort of pulled back today, but found support where you'd like to do it. And it looks like it's going to bounce. One that's not bouncing, and that one is showing accelerating growth recently, though it didn't accelerate this time, it looks like. Coherent, COHR. I don't know what's wrong here. It beat views, not by a ton, but it guided up on Q3 fiscal revenue, but it is down 10%. And I don't know if there's an obvious flaw or if it's just people wanted more.

19:50Ed Carson:And a couple others is that one more is EZCorp, EZPW. It's a pawn shop operator. That one is doing pretty well. That one sort of was at a shelf. Strong mover after the close. And Allegiant Travel had earnings, and I know they beat on revenue, ALGT. And I don't think that stock is moving very much, but that one had a strong day. Airlines had a strong day, you know, overall.

20:17Ken Shreve:Yeah, look at Allegiant Travel.

20:20Ed Carson:Yep. And the really strong growth seen in next year. I mean, sorry, not next year, this year, 2026. So those numbers are a ton of things that are reporting today, but those are just a few.

20:31Ken Shreve:Very good. Allegiant Travel in the airline group. And we've been talking about jets on IBD Live, jets, ETF, airline stocks, IYT. The transports have been doing very well as this market has broadened out beyond technology, seeing the railroads taking off, railroad stocks breaking out. So definitely a split market as money starts to come out of AI stocks, chip stocks. So definitely a lot going on. Ed, thanks as always for your analysis and insight. We appreciate it. All right. That's going to do it for today. Rachel Fox is going to have your back on IBD Live tomorrow. That's on Thursday. If you haven't checked out IBD Live yet, be sure to go to investors.com slash IBD Live.

21:28Ken Shreve:You can check out IBD Live for a two-week trial. Tomorrow, it's going to be Ed and Lexi for the Stock Market Today video. So be sure to check that out. That will do it for today. Thanks very much for watching. Have a great rest of the day, everyone. We will see you back here tomorrow. Thanks again. Take care, everyone. Bye-bye. Thank you.

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