Stocks Set New Support Level With CPI Data on the Way
The Magnificent Seven outperformed and some hard-hit names recovered.
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The S&P 500 and Russell 2000 (IWM) were lower for the third day in a row, but there were some signs of support despite the poor action. Only about 43% of stocks managed gains, and there were 128 new highs to 229 new lows, but the indices bounced in the afternoon and ended the day with some upticks.
The Magnificent Seven (MAGS) outperformed, gaining 0.6%, and money flowed back into some of the hardest-hit big caps, such as Oracle (ORCL) , Broadcom (AVGO) and Microsoft (MSFT) . Tesla (TSLA) has been a leader recently and hit a new all-time high. The Nasdaq 100 (QQQ) also managed a small gain.
While this was not an aggressive snapback rally, the dip buyers did show up and put forth a little more effort. They are obviously a big gun shy after the big drops in data centers, AI and several other groups that had been leaders not long ago.
There is now a support level at Tuesday's lows, and if that holds, it will be a good foundation for some positive action to wrap up the year. The bears can no longer claim the action is frothy and overbought, and FOMO can heat up quickly if the bulls build on this mild positive action.
I put a little cash to work, but the charts are a mess, and it is hard to trust these oversold bounces.
The economic news didn’t bolster the bullish case, and we will see more important data on Thursday when the November CPI is announced.
It has been a very rough market lately, but there were some signs of stabilization on Tuesday, which is a promising start as we count down the last few days of 2025.
Have a good evening. I’ll see you tomorrow.
At the time of publication, DePorre had no positions in any securities mentioned.
