The Daily Breakdown looks at some struggling industries, like automakers and defense contractors. Ford shares break below support.
Thursday’s TLDR
- Digging into the strugglers
- Ford breaks below support
- Palantir dips
What’s happening?
The S&P 500 notched a record high for a second straight session and it was joined by gains in the Dow and Nasdaq 100. It’s not just a couple of stocks doing the heavy lifting, either.
In fact, it’s a broad effort with all 11 S&P 500 sectors higher so far in 2025. However, not all industries have been enjoying the rally.
Defense stocks have struggled quite a bit and worries over reduced government spending have been adding to their recent woes. Stocks like Lockheed Martin, Northrop Grumman, L3 Harris and General Dynamics have struggled badly over the last several months. Reports of defense spending cuts even hit Palantir yesterday.
There’s been struggles with the auto industry as well. While some stocks, like Ferrari, have done well, a number of others have struggled. Companies like Ford, General Motors, and Stellantis (owner of brands like Jeep and Dodge, among others) have had trouble keeping pace with the broader market.
While there are certainly plenty of positive observations about the current market, not all stocks are participating equally.
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The setup — Ford
Since hitting a high above $25 in 2022, Ford stock has continued to struggle, recently breaking below key support.
The $9.50 and $9.75 zone had been a key support zone since summer, but it broke early this month and turned into resistance when the stock tried to rally back above it. Also notice how the 50-day moving average has been acting as resistance.
Bears want to see Ford stock continue to struggle and fail to get back above this prior support level. If the $9.50 to $9.75 area continues to act as resistance, then more downside momentum could continue.
However, if Ford is able to climb back above prior resistance and the 50-day moving average, then a larger rally could ensue.
Options
For options traders, puts or bear put spreads could be one way to speculate on further downside. It could also be a way for Ford bulls to hedge their long positions.
If investors instead want to speculate on more upside, they can utilize calls or call spreads.
Find out more about options trading with our free Academy courses, and practice draft trading risk-free until you’re ready to try options trading for real.
What Wall Street is watching
PLTR – Shares of Palantir took a hit on Wednesday, falling more than 10%. That’s even as the stock hit a new record high during the session. The selloff was partly fueled by worries over defense spending and partly on news that CEO Alex Karp plans to sell more than $1 billion worth of his holdings. Check out the chart.
HIMS – Hims & Hers has been on fire, with shares up more than 50% over the past week and rising more than 17% on Wednesday to notch new record highs. The rally comes as the company announced an acquisition of Trybe Labs in an effort to expand into at-home blood testing and diagnostics.
CVNA – After hitting 52-week highs on Wednesday, Carvana stock is under pressure in pre-market trading on Thursday. The decline comes even after the company delivered an earnings and revenue beat. Carvana sold 114,379 retail units in the quarter, up about 50% year over year and beating analysts’ expectations.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.