Constellation Energy was the best stock in the S&P 500, up 13.9% after Google entered a 3,590-megawatt power deal with the company. Traders who want the data-center trade without owning another chipmaker just got one more way in.
Outside of AI, Option Care Health surged 32.7% after McKesson and Clayton Dubilier & Rice agreed to buy the company in a deal valued at about $5.8 billion, including debt. That’s two days in a row with a big bid on the table after Monday’s cash offer for PTC, and the takeover crowd is staying busy.
Breadth Improved, but the Nasdaq Still Has More New Lows
The breadth was better than Monday, but I wouldn’t call it clean. Advancers beat decliners by close to three-to-one on the New York Stock Exchange and by less than two-to-one on the Nasdaq.
The Nasdaq still logged well over twice as many new 52-week lows as new highs, and that’s with the index sitting at a record.
Earnings Have to Carry the Next Leg
Third-quarter earnings season kicks off next week and the bar is high. Analysts are looking for S&P 500 earnings growth of more than 30% from a year ago, most of it coming from AI-related companies.
Traders already paid up for Nvidia, the hyperscalers, the chip designers and the power names riding data-center demand. There’s not much cushion for a miss with long-term rates still this elevated.
December E-mini S&P 500 Index futures are in a strong position at mid-session on Tuesday. The main trend is up according to the daily swing chart. A trade through the August 13 main top at 7,904.00 will reaffirm the uptrend. A move through the two-day bottom at 7,672.75 will change the main trend to down.
The uptrend is also being supported by the 50-day moving average at 7,751.19, which is providing support and reinforcing the bullish trend.
What to Watch
Several Fed speakers Tuesday and Wednesday’s September meeting minutes are the next shots at a bond market that only just backed off. Tuesday’s breadth came straight from that pause in yields and oil. Earnings start next week with high expectations already in the price, and the bid under these records still leans on the long end staying quiet.
December E-mini Nasdaq-100 futures ran to another record Tuesday, six straight higher sessions off 30,356.75, and stayed above the June record at 31,336.75. The bias is bullish because of the new record high, the uptrend on the main swing chart and the market’s relatively strong position above the 50-day moving average.
December E-mini S&P 500 futures were pressing toward the August 13 top at 7,904.00 at mid-session, with the two-day bottom at 7,672.75 underneath and the rising 50-day moving average holding in between.
More Information in our Economic Calendar.
