Stock Market Update

[BRIEFING.COM] The stock market retreated this morning as mega-cap and tech names faced some profit-taking amid renewed concerns of stretched valuations. The S&P 500 (-0.8%), Nasdaq Composite (-1.1%), and DJIA (-0.3%) all move lower, while the small-cap Russell 2000 (-0.8%) and S&P Mid Cap 400 (-0.6%) hold similar losses. 

Palantir Technologies (PLTR 193.73, -13.45, -6.49%) posted a stellar beat-and-raise Q3 earnings report yesterday after the close, yet the stock, which trades at a lofty forward price-to-earnings ratio above 230x, moved decidedly lower. 

The move took some steam out of a market that has been bolstered by the AI trade recently. NVIDIA (NVDA 201.50, -5.38, -2.60%) and other chipmakers face weakness today, sending the PHLX Semiconductor Index 2.0% lower. 

The broader information technology sector (-1.4%) is the top laggard so far, while the industrials (-1.2%), communication services (-1.1%), consumer discretionary (-1.0%), and energy (-1.0%) sectors also face significant losses.

Meanwhile, a combination of earnings strength and some buying interest among recent underperformers has four S&P 500 sectors trading with modest gains. 

Breadth figures are still markedly negative, with decliners outpacing advancers by a roughly 2-to-1 ratio on the NYSE and a roughly 3-to-1 clip on the Nasdaq. 

The Vanguard Mega Cap Growth ETF is down 1.2%, and the S&P 500 Equal Weighted Index (-0.3%) outperforms the market-weighted S&P 500 (-0.8%), highlighting outsized weakness across the market's largest names. 

[BRIEFING.COM] The major averages are little changed over the past half hour as sector strngth remains splt, with tech and mega-cap names among the laggards.

EndPoint News reports that Eli Lilly (LLY 899.20, +2.67, +0.30%) and Novo Nordisk A/S (NVO 49.02, -0.09, -0.18%) will soon announce new drug pricing deals with the White House. The health care sector (+0.3%) holds a modest gain today, supported by strength in Waters (WAT 377.70, +32.12, +9.29%) and Henry Schein (HSIC 69.69, +5.05, +7.81%) after topping earnings estimates. 

While not an S&P 500 component, Hims & Hers Health (HIMS 46.14, +1.75, +3.94%) holds a nice gain despite missing EPS expectations by $0.03, beating revenue expectations, and guiding Q4 revenues below consensus. 

[BRIEFING.COM] The S&P 500 (-0.5%), Nasdaq Composite (-0.8%), and DJIA (-0.2%) sit modestly improved from their opening losses. 

Four S&P 500 sectors now trade in positive territory, led by a solid gain in the financials sector (+0.7%). Apollo Global Management (APO 132.31, +8.36, +6.74%) is up nicely after a solid Q3 earnings report, with major banking names also moving higher. 

While still a fair ways off of its baseline, the consumer discretionary sector (-0.6%) has nearly halved its opening loss. The sector faces pressure from cruise line names after Norwegian Cruise Line (NCLH 19.50, -2.68, -12.08%) beat EPS estimates but missed revenue expectations and guided Q4 EPS estimates below consensus. 

Elsewhere in the sector, Amazon (AMZN 253.73, -0.27, -0.11%) oscillates around its flat line, showing resilience in the face of today's trend of mega-cap profit taking, even after rising 13% over the past two sessions. 

[BRIEFING.COM] The S&P 500 (-0.7), Nasdaq Composite (-0.9), and DJIA (-0.5%) opened to losses this morning as mega-cap names face considerable pressure. 

Palantir Technologies' (PLTR 192.77, -14.41, -6.95%) price action is at the crux of today's weakness, with the stock moving lower despite crushing earnings estimates and raising guidance. Investors seem to be focused on valuation concerns, which has prompted profit-taking across the broader market. 

Nine S&P 500 sectors move lower, and three of those sectors hold losses wider than 1.0%.

Unsurprisingly, the information technology sector (-1.1%) is among that group, with Palantir Technologies the worst performer in the sector. The bottom of the leaderboard is also dotted with semiconductor names, pushing the PHLX Semiconductor Index 1.3% lower

The energy sector (-1.6%) is the top laggard, moving lower as the price of oil falls $0.43 (-0.7%) to $60.62. Marathon Petroleum (MPC 176.45, -19.34, -9.88%) is a notable laggard after an earnings miss. 

While today's opening move was decidedly lower, the major averages (and a majority of S&P 500 sectors) are off their session lows already, suggesting a buy-the-dip bid may already be taking shape. 

The stock market is on track for a lower open this morning, with the S&P 500 futures currently trading points below fair value. 

The market's largest names are moving emphatically lower this morning despite a dearth of corporate news. Palantir Technologies (PLTR 190.20, -16.98, -8.2%) continues to slide in the pre-market after a beat-and-raise earnings report, triggering some profit taking among other AI-related names.

With mega-cap earnings mostly in the rearview (NVIDIA reports later this month), it is not surprising to see some profit-taking interest after a solid round of earnings that sent several of the "magnificent seven" names to fresh record highs.