CNBC Television
Seeing profit taking in all areas of the market right now, says Bespoke's Paul Hickey
11/4/2025, 11:39:36 PM
Economic Summary
- Profit taking is occurring broadly, especially in tech and AI-related names; concentrated leaders carry the most downside if momentum reverses (e.g., PLTR volatility).
- Market valuations are elevated: S&P 500 trading around 23x forward earnings and Nasdaq 100 near 28x, above recent averages, implying less margin for error.
- Liquidity appears to be ebbing from risk assets, evidenced by cryptocurrency weakness, which can exacerbate drawdowns in speculative stocks.
- There is a notable divergence between cap-weighted and equal-weighted indexes (equal-weight ~25% discount), signaling concentration in mega-caps and potential for convergence if rotation occurs.
- Company-level strength exists: Amgen (AMGN) beat EPS/revenue, saw double-digit product sales growth, and raised guidance, showing pockets of fundamental resilience.
Bullish
- Rotation into consumer cyclicals and lagging sectors if the government reopens.
- Amgen beat expectations, grew product sales, and raised full-year revenue and EPS guidance.
- Equal-weight outperformance days suggest opportunities beyond mega-cap tech leaders.
Bearish
- Elevated tech valuations and recent profit taking could lead to a broader market pullback if leadership falters.
- Liquidity appears to be leaving risk assets (e.g., crypto downdraft), increasing downside risk for high-multiple stocks.
- Palantir has shown repeated sharp drops (12th time down 7%+), indicating stock-specific volatility and fragility.
- Small caps are more exposed to shutdown-related disruptions and may underperform if closures persist.
Bullish tickers
AMGN
Bearish tickers
PLTR
PLTR
Bullish
Has historically rebounded after prior large drops and attracts heavy attention around earnings catalysts.
Bearish
Frequently experiences sharp declines (12th time down 7%+ this year), illustrating high volatility and downside risk.
AMGN
Bullish
Beat EPS and revenue, grew product sales 12% with volume-driven growth, and raised full-year revenue and EPS guidance.
Bearish
Stock pulled back from its initial post-earnings pop, suggesting some profit taking risk remains.
People mentioned
Paul HickeyMike SantoliJohn