The stock market clawed back from a global rout to finish higher Friday, but there still may be an opportunity for some names to rebound. Stocks had a rough start to the week. Disappointing payrolls data coupled with an unraveling of the yen "carry trade," not to mention concerns that the Federal Reserve has waited too long to cut interest rates, sent the major indexes reeling.
But following optimistic weekly jobless claims data on Thursday, the indexes headed higher and the S & P 500 notched its best day since 2022. The broad market S & P 500 gained 0.47% in Friday's session, finishing the week down by just 0.
04%. The Nasdaq Composite closed 0.51% higher, while the Dow Jones Industrial Average advanced 0.
13% Friday. With this in mind, CNBC Pro screened for the most overbought and oversold stocks on the Street, as measured by their 14-day relative strength index, or RSI. Stocks are considered overbought with a 14-day RSI above 70, meaning they may be at a risk of a pullback.
Alternatively, stocks are viewed as oversold with an RSI below 30, which suggests a possible buying opportunity. Disney may be due for a bounce higher with an RSI of 27.7.
Shares of the company were down nearly 4% this week despite the entertainment giant topping Wall Street's fiscal third-quarter estimates . In 2024, the stock, which has a consensus rating of buy, is even lower, dropping around 4.5%.
The company reported that its theme parks business in the U.S. was hit by a pullback in consumer demand.
In an earnings call with analysts, Disney executives said they anticipate flat attendance in the quarters to come. "We saw a slight moderation in demand. I certainly wouldn't call it a significant change," Disney Chief Financial Officer Hugh Johnston said.
"I would just call this a bit of a slowdown that's being more than offset by the entertainment business." Take-Two Interactive Software also made the cut in the oversold category, having the highest RSI in the group of nearly 28. On Friday, shares of the video game maker closed higher by more than 4% after the company reiterated its full-year forecast for bookings and earnings.
While shares are slightly positive on the week, up nearly 1%, the stock has tumbled 10% in 2024. TTWO YTD mountain Take-Two Interactive Software, year-to-date Other stocks that made the oversold group are artificial intelligence infrastructure play Super Micro Computer and Ulta Beauty . There are also some names that may have surged too high and may be due for some losses ahead.
Here is a look at the most overbought names on the Street. Kellanova is one of those names. The stock has the highest RSI in the group at 87.
2 and jumped 19% on the week. The stock started out the week with massive gains, closing 16% higher on Monday following news reports that M & M's and Snickers maker Mars was exploring a takeover of Kellanova. The stock hit a new 52-week high during that session.
This year, shares are up close to 34%. K YTD mountain Kellanova, year-to-date Axon Enterprise , maker of the Taser, is another name that has seen huge gains this week. On Wednesday, the stock — which has an RSI of 75.
3 — jumped more than 18% following the company's second-quarter earnings and revenue beat. The company also raised its full-year revenue guidance. Axon Enterprise now expects revenue this year to come in between $2 billion and $2.
05 billion, which is up from a range of $1.94 billion to $1.99 billion.
Analysts remain bullish on the stock, having a consensus rating of buy. The stock closed out the week nearly 25% higher and is up more than 41% this year. AXON YTD mountain Axon Enterprise, year-to-date Lockheed Martin , which has an RSI of 84.
9 and received an upgrade to outperform from sector perform at RBC earlier this week , is also in the group. Shares are up 21.7% this year.
Northrop Grumman also made the cut with an RSI of 75..
