The Magnificent 7 was up more than 20% after the US presidential election, powered by big gains in all members except Nvidia and especially outsized strength for Tesla.
With today’s losses further deepening the breakdown in the momentum trade, the cohort is now down slightly since the election.
Nvidia is the biggest drag on the group, with Microsoft and Amazon also down since the November 5 vote.
Retail favorite Rocket Lab closed at a new all-time high on Tuesday, continuing a remarkable run over the last month that has carried the launch services provider and aspiring Space X competitor up more than 70% over the last month (compared to its close of $49.06 on December 5).
Rocket Lab saw elevated options activity during its run-up today, with well over 3.5x the 90-day average in options volume changing hands over the course of the day.
Other space plays such as AST SpaceMobile and EchoStar surged today.
Despite being a money-losing company — it’s never turned an annual profit as a public company — Rocket Lab’s share price has soared nearly 1,500% over the last two years, generating tons of loyalty and enthusiasm among retail investors.
In fact, Goldman Sachs has made Rocket Lab the heaviest weighting in the latest iteration of its GS Memes basket of thematic stocks, just ahead of AST SpaceMobile, showing how enamored traders have become of such space stocks.
The Nasdaq 100 and Russell 2000 outperformed, rising 0.9% and 1.4%, respectively.
Low-cost airline JetBlue is up more than 8% on Tuesday, on pace for its biggest daily gain since August. If the price momentum holds, Tuesday will mark JetBlue’s sixth-best trading day of the past 52 weeks.
The carrier is being propelled by bullish options activity, with more than 53,000 call options changing hands as of 12:14 p.m. ET, nearly 4x the 20-day average for a full session.
JetBlue closed up 4.6% on Monday, as traders appeared to price in medium-term oil supply relief due to the possibility of Venezuela’s reserves getting more developed amid tensions with the US.
Moderna rose on Tuesday after Bank of America analysts raised their price target for the ailing biotech behind the COVID-19 vaccine, painting a rosy picture of the products in its pipeline.
BofA kept Moderna’s “underperform” rating but raised its price target to $24 from $21, which now accounts for “refreshed revenue builds for lead assets.” Analysts said the company’s cost-cutting measures, paired with potential new revenue from its investigatory oncology vaccines, could bring it back to profitability in the coming years.
Moderna is best known for being tapped by the US government to quickly develop a vaccine for COVID-19 in 2020, a product that remains its single source of revenue. The company has yet to bring new products to market and is now faced with a second Trump administration hostile to that product.
Gaming platform Roblox fell as much as 7% on Tuesday, following reports of widespread outages overnight and a lowered price target from TD Cowen.
Downdetector, a monitoring service that uses “signals from its own websites, social media platforms and other sources” to analyze outages, tracked roughly 22 outage reports per second at peak overnight Monday into Tuesday.
Meanwhile, TD Cowen issued a new research note on Roblox Tuesday, lowering its price target on the stock to $70 from $77. Analyst Doug Creutz wrote that user engagement with the platform’s biggest hits, including “Grow a Garden” and “Steal a Brainrot,” declined 52% between mid-September and mid-December. The firm lowered its fiscal year bookings estimate from $8.48 billion to $8.09 billion.
