Can traders benefit in the uncertain environment?

Major US stock markets maintained their upward trend even though they all closed the previous week in red territory. The movement in the past months could imply that investors are willing to undertake a more risk-on approach even though more time may be required for the economy to sustain its recovery. This report will overview some important stock movers from the most recent sessions detailing the fundamental drivers behind their move. Stocks that could make a move in the following days will also be included while technical analysis for one of the shares selected will be provided at the end.

Walmart down on questionable results

Walmart Inc. (#WMT) ended the session in negative territory on Tuesday leaving behind -2.55%, closing the session at $143.17. On the 16  of November Walmart announced its earnings report for the 3  quarter of 2022, forcing analysts and traders to turn their attention to the new information. Even though total revenues came out at $140.5 billion and were up 4.3% ($5.8 billion) compared to the same quarter last year, Walmart stated the figure was negatively affected by an amount almost double the gain due to divestitures. Moreover, on a positive note Walmart noted its U.S. e-commerce revenues were up by 8% for the quarter and 87% on a two-year stack. On the contrary Walmart’s official report stated its consolidated gross profit rate dropped 42 basis points, mainly due to increased supply chain costs. This information may have been the main reason behind Walmart’s selloff on Tuesday, as its stock had performed its largest daily drop in several months displaying investor’s disappointment. Characteristically however, Walmart Chief Executive Doug McMillon stated that the massive retailer maintains the appropriate amount of products to serve customers through the holiday season, ending concerns that the business would run out of goods. Of course the worries are based on a global supply chain matter that is currently holding back the world economy as a whole. At the moment Walmart’s 52 price range is between $126.28 and $153.66.

Home Depot jumps on optimistic results

Home Depot, Inc. (#HD) the home improvement retailer headed the list of the gainers under Dow Jones on Tuesday with the very impressive gain of +5.73% closing the session at $392.33, reaching a new 52 week high price. The substantial move upwards for the stock came as a result of Home Depot’s earnings results which were also released on the 16  of November. Through the earnings report the company confirmed U.S. comparable sales rose 5.5% for the 3  quarter of 2021 while this figure beat quarterly sales estimates by nearly $2 billion. The Wall Street Journal noted that even though fewer shoppers visited Home Depot stores compared to the same period last year, spending increased. This can also be used as evidence that even though the pandemic has negatively impacted economies around the world, it has also enabled consumers to save a considerable amount of money which they can now use to improve their homes. From a different aspect of the economy, a Reuter’s report also noted that high home prices are basically forcing Americans to invest in their current homes rather than buying a new one. This point can also be used as a prognostic for future performance of Home Depot that is in the position to possibly benefit from the current economic circumstances. In October, reports had surfaced indicating HD was among the retailers that were using chartered ships to maneuver traffic at ports. Of course the costs of such an action are transferred to the consumer’s bill yet the company is in place to serve at full capacity and thus has more chances of performing well.

Nvidia expects earnings release on the 17  of November

Nvidia Corporation is in the market’s focus today as traders will be carefully monitoring the company’s quarterly results. At the moment Nvidia is up by the staggering +131.35% on a year to date basis. Nvidia’s most recent close found its stock trading at $302.03 which is not far away from its 52 week high price just at $323.10. According to Reuter’s Nvidia’s current market cap is at $755 billion while according to the Wall Street Journal the company is the most valuable among the semiconductor industry. Many analysts are referencing the semiconductor business as a rising star, with demand for chips expected to surge many fold in the near future. During the end of October Nvidia benefited greatly from news that Facebook (#FB), now called Meta Platforms, Inc. will be investing a significant amount of money to create it’s much written about Metaverse. Nvidia was seen benefiting from such an action by Facebook as many semiconductors will be required to setup the virtual world.

NVIDIA H1

At the moment Nvidia is trading in a sideways motion between the (R1) 306.25 resistance and the (S1) 290.50 support. These levels have been tested various times in the past week but have not been breached making this range an important indicator for the stock’s price action. We have highlighted the range in yellow as the results from the earnings report today can force the price action outside of these barriers making them both a crucial indicator for further movement. In case of a move to higher grounds, we note the (R2) 314.45 level as the possible first target while at the top the (R3) 322.35 is the highest price reached since the stock split in July. In the possibility of a move downwards we note the (S2) 280 support while our lowest level for this analysis remains the (S3) 266.20 level.  Below our chart the RSI indicator continues to move across the 50 line which is a sign of anticipation by traders from our point of view.

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