Stock Market Update

[BRIEFING.COM] It was a struggle for the stock market today, largely because it was a struggle for growth stocks as a whole and many of the mega-cap stocks. Both groups were hit with some profit-taking interest and were saddled with residual concerns over stretched valuations and excess speculation.

In a certain respect, it was a rehash of Tuesday's selling in the wake of Palantir Technologies' (PLTR 175.07, -12.83, -6.83%) earnings report, only the losses overall weren't as significant. There was the same concentration factor, however.

The Vanguard Mega-Cap Growth ETF (MGK) and the Russell 3000 Growth Index were both down as much as 1.9% at their worst levels of the day before they pared their losses. They finished today's session down 1.7% and 1.6%, respectively.

Outsized losses in e.l.f. Beauty (ELF 76.62, -41.21, -34.97%), Duolingo (DUOL 193.74, -66.28, -25.49%), DoorDash (DASH 196.46, -41.54, -17.45%), and Paycom Software (PAYC 164.05, -19.66, -10.70%) after they disappointed with their results and/or guidance took a toll on investor sentiment, as did a Q3 warning from CarMax (KMX 30.88, -9.93, -24.33%), which also said its CEO will be stepping down.

Then, there was the overhang of losses in Tesla (TSLA 445.91, -16.16, -3.50%), NVIDIA (NVDA 188.08, -7.13, -3.65%), Meta Platforms (META 618.94, -17.01, -2.67%), Amazon (AMZN 243.04, -7.16, -2.86%), and Microsoft (MSFT 497.10, -10.06, -1.98%). Alphabet (GOOG 285.34, +0.59, +0.21%; GOOGL 284.75, +0.44, +0.15%) bucked that trend on a report that it will make its powerful AI chip, Ironwood, widely available in the coming weeks. That report presumably weighed some on NVIDIA.

Weakness in these mega-cap leaders made it all but impossible for the market cap-weighted indices to stake a claim on positive ground. In fact, the majority of stocks struggled today. Decliners led advancers by a 9-to-5 margin at the NYSE and by a better than 2-to-1 margin at the Nasdaq. 

There were only two sectors that ended the day higher—energy (+0.9%) and health care (+0.2%). The latter saw some added news flow, with President Trump announcing in an Oval Office briefing that Eli Lilly (LLY 937.76, +11.95, +1.29%) and Novo Nordisk A/S (NVO 46.50, -1.96, -4.04%) will provide most-favored nation drug pricing for their weight-loss drugs.

The consumer discretionary (-2.5%) and information technology (-2.2%) sectors were today's worst-performing areas. Interestingly, they were the only two sectors that underperformed the S&P 500 (-1.1%). The other losing sectors were down between 0.3% and 0.7%.

There weren't any official government reports today due to the shutdown. Challenger, Gray & Christmas reported, however, that job cuts in October (153,074) were the highest they have been in any October since 2003.

That report also acted as a deterrent for buyers in today's session, although it was a factor in the gains seen in the Treasury market. The 2-yr note yield settled the session down six basis points at 3.57%, while the 10-yr note yield settled the session down six basis points at 4.09%.

• Nasdaq Composite: +19.4% YTD
• S&P 500: +14.3% YTD
• DJIA: +10.5% YTD
• Russell 2000: +8.7% YTD