CNBC Television
Markets look for stability: Here's what you need to know
11/5/2025, 6:18:35 PM
Economic Summary
- Retail traders now represent roughly 25% of trading volume and have been a primary driver of the rally; this retail dominance can both amplify moves and introduce fragility due to a gambling mentality.
- BofA flow data showed large institutional single-stock sales recently, indicating institutions turned more defensive last week even as retail remained the dominant presence.
- Market skittishness over valuations is prompting a rotation away from high-beta, momentum names toward quality and defensive sectors like health care, evidenced by differential earnings reactions.
- AI capex and corporate fundamentals (earnings, buybacks, inflows) are viewed as the primary tailwinds; companies that can demonstrate tangible AI integration could see stronger margins and support for valuations into 2026.
Bullish
- AI-related capex and proven AI integration should reward select large-cap tech and capex beneficiaries.
- Seasonal strength, equity inflows, and corporate buybacks support a year-end rally.
- Rotation into higher-quality names and healthcare can sustain broader market gains.
Bearish
- High-beta, speculative names remain vulnerable after recent sharp losses and technical damage.
- Large institutional net selling (BofA data) suggests growing defensive positioning among institutions.
- Valuation skittishness could slow the rally and push flows toward quality.
- Concentrated retail-driven trading (gambling mentality) can increase fragility in microcap names.
Bullish tickers
MSFTAMZNGOOGLSCHW
Bearish tickers
PLTRRGTIAXON
PLTR
Bullish
Retail interest and any demonstration of product traction in AI could drive renewed rallies.
Bearish
High-beta, speculative; experienced parabolic moves and recent sharp sell-offs causing technical damage.
RGTI
Bullish
If momentum returns, it could see quick rebounds, but risk remains elevated.
Bearish
Parabolic small-cap with recent technical damage and leverage, making it vulnerable to further downside.
AXON
Bullish
If fundamentals reassert, could recover as investors rotate into quality names.
Bearish
Example of a company that reported earnings yet failed to rally, showing market is discerning.
META
Bullish
Large AI investments could pay off long term if monetization accelerates.
Bearish
Sold off after earnings, raising questions about the pacing and payoff of AI spending.
MSFT
Bullish
Major AI exposure and enterprise adoption position it to benefit from AI capex trends.
Bearish
Traded flat after earnings, suggesting some skepticism about near-term upside.
AMZN
Bullish
Positively rewarded after earnings; strong capex and cloud positioning support AI-driven growth.
GOOGL
Bullish
Alphabet was rewarded post-earnings, indicating investors value demonstrated AI-related progress.
SCHW
Bullish
Advisor business booming; record attendance and optimism among advisors support firm fundamentals.
GS
Bullish
Research (e.g., Tony Pasquarello) frames a responsibly bullish stance emphasizing AI capex and growth.
People mentioned
Scott WapnerJoe TerranovaBryn TalkingtonShanna SekoshaMalcolm BathurstLizanne SaundersTony Pasquarello