Rebound in Material Stocks Trimmed SPY Losses, Led EWU Up
Technology sector dragged SPY down
The technology sector was the second biggest drag on the SPDR S&P 500 ETF (SPY) on Wednesday, December 9. Apple (AAPL) and F5 Networks (FFIV) weighed down the sector heavily, falling -2.2% and -3.0%, respectively, on the day. Also, Adobe Systems (ADBE), Alphabet (GOOGL), Microsoft (MSFT), Yahoo! (YHOO), and Facebook (FB) fell -2.4%, -1.6%, -1.5%, -1.3%, and -1.8%, respectively, on the day. Let’s perform a moving average analysis along with volatility on these stocks.
The table contains the above-stated stocks along with their respective moving averages.
Moving average analysis
The beta value of the above stocks is generally more than one, and hence more sensitive to the broad market movement. Note that F5 Networks (FFIV) has a beta that’s less than one.
The average trailing-one-year return and the average trailing-one-month return of the above stocks shown in the table are 15.1% and -0.5%, respectively. This implies that the sector performed well through the year. The reason was the sector’s upbeat corporate earnings even in the recent third quarter when the entire market went through a volatile period.
The average trading price of these stocks is $251.7 while the average values of the 100-day, 50-day, and 20-day moving averages are $232, $242, and $252, respectively. As the average trading price has nearly crossed its moving averages, these stocks display an upward trend.
When compared to the respective analysts’ stock price targets, the average growth potential of these stocks is 15%.
Additionally, these stocks have earned 28 “Buy,” ten “Hold,” and one “Sell” recommendations on an average basis. F5 Networks (FFIV) fell 3% on December 9 as the stock was downgraded to “Sell” by the analysts at Nomura Securities International. Meanwhile, Yahoo! (YHOO) lost on the day as it dropped its plan to spin shares in Alibaba.
Next, let’s look at the key stocks of the SPDR S&P 500 ETF (SPY) on Wednesday, December 9.
Browse this series on Market Realist: