Morningstar

Weekly Market Update: Tech Stocks Lead Market Lower, Basic Materials Gain

Tilray jumped 65%, while Marvell fell.

The Tilray Brands logo is displayed on a smartphone screen
Cheng Xin via Getty
Securities in This Article
Vertiv Holdings Co Class A
(VRT)
Bloom Energy Corp Class A
(BE)
Oracle Corp
(ORCL)
Nike Inc Class B
(NKE)
EchoStar Corp Class A
(ECHO)

Stock Market Update for the Trading Week Ended Dec. 12

  • The Morningstar US Market Index fell 0.55%.
  • The best-performing sectors were basic materials, up 3.06%, and financial services, up 2.38%.
  • The worst-performing sectors were technology, down 2.18%, and communication services, down 1.63%.
  • Large-cap stocks fell 0.92%, mid-cap stocks rose 0.43%, and small-cap stocks rose 0.96%.
  • Growth stocks fell 1.12%, blend stocks gained 0.11%, and value stocks rose 1.19%.
  • The S&P 500 fell 0.63% and the Nasdaq fell 1.62%.
  • Of the 837 US-listed companies covered by Morningstar, 500, or 60%, were up, four were unchanged, and 332, or 40%, were down.

US markets pulled back after an initial rally following the Federal Reserve’s interest rate cut, with the US Market Index slipping 0.55%. Technology led the declines, falling 2.18% for the week as AI heavyweights Oracle ORCL and Broadcom AVGO fell sharply after earnings. With investors rotating out of tech stocks, basic materials gained 3.06% and financial services rose 2.38%.

For much of the week, the focus was on Wednesday’s rate decision from the Fed. While the central bank cut rates by a quarter of a point, there was notable disagreement among policymakers. Still, it was enough to spark a rally on Thursday, only to see those declines eroded on Friday. While the Fed’s move was widely expected and “pushed equities higher, markets lost momentum later in the week as investors rotated out of technology and AI-related stocks,” explains Morningstar chief multi-asset strategist Dom Pappalardo.

Other Markets

  • Yields on 10-year US Treasury notes rose to 4.19% from 4.14%.
  • Yields on two-year US Treasury notes fell to 3.52% from 3.56%.
  • West Texas Intermediate crude prices fell 4.44% to $57.47 per barrel.
  • Comex Gold prices rose 2.46% to $4,300.70.

Top Stock Gainers

Tilray Brands TLRY, EchoStar SATS, Cogent Communications CCOI, AmeriCold Logistics COLD, and Uniti Group UNIT were the top performers among US-listed stocks covered by Morningstar analysts.

  • Tilray topped the list, rising 65.31%, but it’s down 20.47% over the past three months. This no-moat company with a 4-star rating has decreased 33.1% over the past 12 months. The stock closed the week at $12.15, trading at a 40% discount to its fair value estimate of $14 per share.
  • EchoStar was the second-best performer, with a weekly return of 30.92%. The 3-star stock has gained 35.5% over the last three months and 345.35% over the past 12. EchoStar stock wrapped up the week at $107.37, trading at a 23% premium to its fair value estimate of $85 per share.
  • Ranked third for the week, Cogent saw its stock rise 18.6%. The 4-star, narrow-moat stock has fallen 32.29% over the last three months and is down 64.13% over the past 12. Cogent stock closed at $23.27, trading at a 43% discount to its fair value estimate of $43 per share.
  • The fourth-best-performing stock was no-moat AmeriCold, which gained 18.42%. The 5-star stock has fallen 6.54% over the last three months and is down 41.12% over the past 12. AmeriCold finished the week at $12.73, trading at a 52% discount to its fair value estimate of $26 per share.
  • Uniti stock climbed 16.59% in the latest week. This no-moat company has seen an increase of 1.83% over the last three months and a rise of 18.88% over the past 12. The 2-star stock ended the week at $7.45 per share, a 45% premium to its fair value estimate of $5.00.

Top Stock Losers

Bloom Energy BE, Vertiv VRT, Marvell Technology MRVL, Compass Minerals International CMP, and Alnylam Pharmaceuticals ALNY did the worst among US-listed stocks covered by Morningstar analysts.

  • Bloom Energy was the worst-performing stock of the week, falling 20.31%. This 1-star, no-moat company has increased 61.97% over the last three months and 361.82% over the past 12. The stock ended the week at $94.98, trading at a 160% premium to its fair value estimate of $42 per share.
  • Vertiv took the second spot, with a 14.68% decline this week. The narrow-moat company, rated 2 stars, has increased 31.72% in the past three months and 42.11% over the past 12. Closing at $161.27, the stock trades at a 22% premium to its fair value estimate of $147 per share.
  • Marvell came in third, experiencing a 14.64% drop this week. This 4-star, narrow-moat company is up 34.39% in the last three months but down 19.48% over the past 12 months. The stock finished the week at $84.42, trading at a 25% discount to its fair value estimate of $120.00 per share.
  • Next up is Compass Minerals, which saw its stock price fall by 14.45% this week. The narrow-moat company with a 3-star rating has dropped 4.32% over the past three months but is up 30.24% over the past 12 months. At $17.35, the stock trades at a 12% discount to its fair value estimate of $20 per share.
  • Alnylam rounds out the list with a 13.22% decline this week. This 2-star, narrow-moat company has decreased 11.94% over the past three months but rose 62.36% over the past 12 months. The stock closed the week at $397.55, trading at a 33% premium to to its fair value estimate of $310 per share.

Highlights of This Week’s Market and Investing Events

This article was generated with the help of automation and reviewed by Morningstar editors. Learn more about Morningstar’s use of automation.

The author or authors own shares in one or more securities mentioned in this article. Find out about Morningstar’s editorial policies.

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