Stocks: The Good, The Bad and The Ugly

Consumer stocks, semiconductors breaking out and more

Good morning,

The S&P 500’s range continues, with yesterday marking the 33rd consecutive day the index has traded exclusively in the 3.4% range between 4048 and 4187. However, it’s a market of stocks and there is still action happening under the surface if you know where to look.

Today’s report will review:

• Consumer stocks amid key earnings reports

• Semiconductor stock breakouts

• Industrial bellwethers that act poorly

• Trouble with automakers

• Utilities getting crushed

• Big pharma weakness

• and more!

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Big week for consumer earnings

Target in purgatory

Target reported earnings yesterday and it did nothing to budge the stock from the 33% range it has traded in for exactly one year as of yesterday. No reason to be long or short this stock.

Home Depot trying to hold March lows

True home-building stocks continue to hit 52-week highs. My belief is that because so many homeowners are now trapped in the velvet handcuffs of a sub-3% mortgage, the only way a non-homeowner is going to become a homeowner is with a new home, thus the strength in the group despite rising rates. However, this tailwind hasn’t extended to home improvement retailers like Home Depot, which is down 34% from its high. The stock is holding the $280 level the past two days, which is good because a break of that would further the case for this being a giant top.

Wal-Mart a sell below $155

WMT is coming off 3-month relative highs but was just rejected once again at $155. Earnings come out this morning, but unless today’s move vaults the stock above $155, it looks like a sell.

Costco earnings are next Thursday

Costco didn’t report this week like the 3 stocks above but does have earnings next week. Those will likely be important because the stock needs an upward push soon to break the downtrend line that goes back to August. Any move lower needs to see COST hold $450.

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Semiconductor breakouts