Multiple meetings between U.S. lawmakers failed to solve the default crisis
This week the U.S. debt ceiling once again took center stage, as multiple meetings between lawmakers failed to produce a resolution. A divided central bank also put pressure on sentiment, with an upward revision to gross domestic product (GDP) and better-than-expected jobs data failing to lift Wall Street's spirits. However, the Nasdaq Composite Index (IXIC) rallied after Nvidia's (NVDA) blowout quarter boosted the tech sector, and is pacing for its fifth-straight weekly win. The Dow Jones Industrial Average (DJI) and S&P 500 Index (SPX) are heading for weekly losses, while the Cboe Volatility index (VIX) is eyeing a win.
Retail Earnings Take Center Stage
The sour sentiment on Wall Street came amid a flood retail reports. Kohl's (KSS) shared an unexpected profit despite higher-than-usual inflation, while Gap (GPS) also posted a surprise earnings beat. Discount retailer Big Lots (BIG) fell to a more than 30-year low, after turning in quarterly losses that nearly doubled expectations.
Home improvement retailer Lowe's (LOW) shared better-than-expected first-quarter results, but lower 2023 forecasts weighed on the results, while strong demand and leaner inventory levels helped Urban Outfitters (URBN) best expectations. Outside of retail, NVDA soared to an all-time high after earnings, while Snowflake (SNOW) eyed its worst day ever following its quarterly results.
Stocks to Watch Right Now
Subscribers to Schaeffer's Weekend Trader got an early look at why eBay (EBAY) is heading for a short-term drop. Conversely, Electronic Arts (EA) and Starbucks (SBUX) both just pulled back to historically bullish trendlines. Yelp (YELP) may also be worth keeping an eye on, as its top shareholder is urging for a sale or merger, calling the stock "shockingly undervalued." Don't forget about our Options Under $5 service, which helped subscribers more than double their money on our KB Home (KBH) recommendation.
How to Play Memorial Day
With markets closed on Monday for Memorial Day, investors will have a shortened week to ponder debt ceiling negotiations and earnings reports. Schaeffer's Senior Quantitative Analyst Rocky White compiled a list of the best stocks to own before the holiday, while Schaeffer's Senior V.P. of Research Todd Salamone quantified the latest market sentiment change.