Transports Roar, Avis Races, Netflix Roasted, AMD Potential Target in Sight

For the most part, domestic equity markets posted yet another positive session on Thursday. Not the robust kind of positive session, but a positive session nonetheless. Equity index futures are at least holding their own as we meander our way through the zero-dark hours as the zero-dark hours pass. By the way, the man in the blackened window says "hi." Both the S&P 500 and Nasdaq Composite closed at all-time record high levels for a second consecutive day.

Friday! Fri-yay! A little profit-taking going into the weekend? Certainly, that would not be the worst idea for traders. Then again, these markets are on a roll and modern algorithms are vehicles that have been designed to create and perpetuate momentum. They're not your friends, but the trend has always been your friend and we use the tools at hand.

Human traders, if still in control in a centralized open-outcry market model, would likely take a little something off of the table going into a weekend. Especially atop a twelve-day winning for the Nasdaq Composite and as the S&P 500 has posted 11 green candles in 12 days. This market though, due to the nature of a fractured point of sale reliant upon automatic keyword reading prompts will continue to be slave to the news cycle. Understand this, and one understands the marketplace.

Talkin' The Talk...

U.S. Pres. Donald Trump made claims on Thursday: "Iran wants to make a deal. They are willing to do things today that they weren't willing to do two months ago. We have a very successful negotiation going on right now. If it happens, it will happen soon." The president added that a deal to end the war may happen "fairly soon." In fact, so soon, a deal to extend the two-week ceasefire that expires this coming Tuesday might be unnecessary. Hmm, markets like that kind of scuttlebutt. Front month WTI Crude, Brent Crude and gasoline futures are all trading lower in response on Friday morning.

The Other Ceasefire

The Financial Times is reporting that at least a few thousand of the 1.2 million displaced people of southern Lebanon started returning to their neighborhoods as a 10-day ceasefire between Israel and Lebanon began officially at 5 ET on Thursday evening. The key terms of this ceasefire? Israel will not take any offensive military action against Lebanese targets for 10 days, while retaining the right to play defense. In return, Lebanon has pledged to take meaningful steps to prevent Hezbollah and other groups from striking Israeli targets from within its borders. Keeping this peace for 10 days may be more difficult than anything else on the table.

Three Little Birds

Don't worry about a thing

'Cause every little thing gonna be alright

Singing, "Don't worry about a thing

'Cause every little thing gonna be alright"

Rise up this morning, smiled with the rising sun

Three little birds pitch by my doorstep

Singing sweet songs of melodies pure and true

Saying, "This is my message to you -ou-ou"

Singing, "Don't worry about a thing

'Cause every little thing gonna be alright"

Singing, "Don't worry about a thing" (Don't worry)

"Cause every little thing gonna be alright"

- Bob Marley (Bob Marley and the Wailer), 1977

Marketplace

Things did in fact slow down a bit for U.S. stocks on Thursday, despite the record highs. The S&P 500 gained "just" 0.26% on Thursday as the Nasdaq Composite tacked on 0.36%. The Dow Transports (+4.13%) were hot as heck as Avis (CAR) ran 13.4%, logistics provider CH Robinson (CHRW) ran 8.1% and trucker JB Hunt popped for a gain of 6.3%. The semiconductors were fairly hot as well. That said, small caps underperformed the broader marketplace and the banks actually struggled.

Breadth

Seven of the 11 S&P sector SPDR ETFs closed out the regular session on Thursday in the green with Energy (XLE) in the lead followed by Communication Services (XLC) and Technology (XLK) . Growth continues to outperform both cyclicals and defensives. Health Care (XLV) rode out the day in the caboose.

Winners bet losers at the NYSE by just a smidgen, and by something close to a five-to-four margin at the Nasdaq. This was far cooler to the touch than what markets have experienced over the past couple of weeks. Advancing volume still took a 57.6% share of composite Nasdaq-listed trade and a 57% share of composite NYSE-listed activity. Solid, but not commanding. Interestingly, for the first time in several days, aggregate trading volume ebbed just a bit. On a day-over-day basis, aggregate trade across Nasdaq-listings dropped by 2.4%, and dropped by an even 2% across NYSE-listings. Activity ebbed slightly across the membership of the S&P 500 as well.

While this did finally put an end to our three-day confirmation of the bullish trend, some indicators do appear to be carrying that torch. For the S&P 500, the 21-day exponential moving average appears to be ready to cross over the 50-day simple moving average in what is sometimes referred to as a "mini" or "swing-traders'" golden cross.

In addition, relative strength has finally reached a technically overbought level, though just barely. Below the chart, readers will see that the daily moving average convergence divergence is postured about as bullishly as that indicator can get now that the 26-day exponential moving average has moved above the zero-bound. Everything else in that indicator is set up to signal an extended rally.

Oh No...

Shares of Netflix (NFLX) are being roasted overnight. The stock is down almost 10% in pre-opening trade as guidance for both Q2 and full-year 2026 revenue generation fell short of Wall Street's expectations. Netflix's outlook for Q2 profitability was also disappointing. In addition, the company announced chairman and founder Reed Hastings would step down from that position and not run for re-election. This is shaking investor confidence overnight.

AMD: to the Moon...

Talk about a breakout! Lisa Su's Advanced Micro Devices (AMD) is breaking out almost parabolically. After this past winter's double top pattern of bearish reversal produced a selloff and this spring's double bottom pattern of bullish reversal created buyers, the stock has now rallied for 12 consecutive days.

This has tacked almost 42% onto the share price. Now, the stock is taking out the highs from that prior double top. Does that mean the rally is almost done? Maybe the parabolic part of the move. Not the rally though, in my opinion. My model shows potential target prices for AMD in the $330s.

Economics

(All Times Eastern)

1:00 - Baker Hughes Total Rig Count (Weekly): Last 545.

1:00 - Baker Hughes Oil Rig Count (Weekly): Last 411.

The Fed

(All Times Eastern)

11:30 - Speaker: San Francisco Fed Pres. Mary Daly.

12:15 p.m. - Speaker: Richmond Fed Pres. Tom Barkin.

2:00 - Speaker: Reserve Board Gov. Christopher Waller.

Today's Earnings Highlights

(Consensus EPS Expectations)

Before the Open: (ERIC) (1.17), (STT) (2.64), TFC (1.00)

At the time of publication Guilfoyle had no position in any security mentioned.