EB Daily Market Report - Brief Update - Thursday, October 10, 2024

Fundamental news this morning was definitely a bit surprising. First, the September Core CPI came in hotter than expected, rising 0.3% vs. the 0.2% expected. This will likely rekindle some inflation fears. Perhaps the more shocking news was in the form of initial jobless claims. After reaching the 250,000 level back during July, I was watching closely to see if the key 260,000 level was topped, which it wasn't. Instead, initial claims dropped right back into the 210,000-230,000 range. Well, this morning, claims jumped to 258,000 unexpectedly vs. the 226,000 consensus estimate.

The Wall Street reaction? Honestly, not that much. Our major indices did show initial weakness this morning, but we're currently trying to rebound. Large caps are outperforming small caps. Growth and value stocks are performing roughly the same.

Commodities are mostly strong, with crude oil ($WTIC, +2.18%) spiking to nearly $75 per barrel. Only three sectors are higher and two of them are energy (XLE, +0.46%) and materials (XLB, +0.13%). Among the 8 sectors in negative territory, real estate (XLRE, -0.72%) is the worst performer.

I want to share a stock and I'd consider it to be a longer-term, somewhat risky, investment. However, it could be an excellent short-term candidate as well if its key price resistance level is cleared. Check out this biotech stock, Illumina, Inc. (ILMN):

ILMN was one of the best-performing stocks for the 15 years ended in 2021, but the past 3 years have been difficult. We could be seeing a key reversal currently, however. If we finally see biotechs ($DJUSBT) make its key breakout near 3100 and ILMN can clear recent price resistance at 144.02, I wouldn't be surprised to see ILMN begin a very strong advance back towards 240-250.

Happy trading!

Tom