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Afternoon Note

Rebounding

By Charles Payne, CEO & Principal Analyst
7/22/2024 1:23 PM

The Nasdaq and the S&P 500 are rebounding today. Semiconductor stocks are leading the rebound, but the session has the aura of summer doldrums meets gathering clouds of unknowns.

It's a slow roll, on light volume, as investors brace for directional signals from major earnings reports on the docket.

The pain in CrowdStrike (CRWD) shares continues today after Friday’s faulty update to one of their end-point security programs called the Falcon platform.  This caused the whole endpoint security application to crash and display the dreaded “Blue Screen of Death.” The recent sell-off saw shares down 11% on Friday, with a further sell-off, down over 10% today, taking it below both its 50 MA and now 200 MA. The continuation from over the weekend is still impacting flights, hospitals are still disrupted, and many other systems are still down as users rush to implement the new patch on all their systems. While some firms have cut their ratings, Wells Fargo and RBC Capital maintain an outperform, but have lowered the targets.

Interest rates are lower today, as the 10-year hovers around 4.22%, while the 2-year is down to 4.52%. Also, the dollar is back to flat, and is currently down 1.5% overall in July, helped in part by investors betting on a September rate cut.

We will get more economic data this week, such as second-quarter GDP, PCE price index report, and flash PMIs.  These reports will help give us more insight into whether we can expect a September cut.


 

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