A fragmented stock market and rising delta variant cases have made it harder for traders to find stocks with upside potential. If COVID-19 cases continue to rise, defensive stocks will start to rally again. So I’ve picked out a semiconductor, industrial, solar, and two biotech plays for Monday — and more in today’s stock market recap.
Stock Market Recap
Despite slow manufacturing data last month, global stocks are mostly higher as many companies report positive earnings.
Since the delta variant suppressed markets last week, earnings and China should be the main factors impacting trading action this week. Earnings have been positive as 89% of companies in the S&P have surpassed estimates. However, traders should be cautious because only 38% of stocks trading above $2 are above their 50-day moving averages. Markets don’t tread smoothly until they pull back from a fragmented state.
Worries of China’s crackdown on tech companies continue as the country reported a weaker-than-expected reading of its manufacturing survey. The figure is the lowest we’ve seen since February 2020 and is bad news for supply chain issues.
The ISM Manufacturing Index for the U.S. fell to 59.5% in July, from June’s 60.6%. A figure above 50% means manufacturing is expanding. July’s reading marks a second consecutive month of slowing manufacturing activity as shortages and supply chain issues continue.
Roger’s Radar: 5 Plays Showing Upside Potential
VanEck Vectors Semiconductor ETF (Nasdaq: SMH) has been choppy lately. The more a security trades horizontally, however, the higher the probability of a breakout. SMH tracks all the semiconductor stocks. And I like this ETF more than individual semiconductor stocks.
The four other plays on my radar include a diversified technology and manufacturing company, a solar stock and two biotech companies.
In this video, you’ll discover the global data driving stocks… which reports investors are paying attention to… which sectors are overbought and which are oversold… which stocks to buy and my top ETF right now.
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Check back each morning for Roger’s Radar and the most important news and numbers in the WealthPress stock market recap.