These stocks are about to form a scary death cross pattern
Trouble is brewing for some stocks even as the market trades near record highs. The S&P 500 and Nasdaq Composite hit new record highs on Wednesday after the latest consumer price index – a widely watched measure of inflation – was flat in May from the previous month, raising hopes about Federal Reserve interest rate cuts later this year. Economists polled by Dow Jones expected a slight increase. However, broader market dynamics failed to deliver strong performance for some stocks. CNBC has screened stocks that are on track to form a scary death cross chart pattern. A death cross occurs when a stock’s 50-day moving average slips below its bearish 200-day moving average. A decline usually indicates that the stock is losing momentum and could face more losses in the near term. Let’s look at the stocks that have made the cut. Aerospace and defense stock Northrop Grumman has fallen about 9% in 2024 and is approaching a death cross chart pattern. The stock is trending down despite some positive news for the company. Northrop was awarded a $119 million contract to the U.S. Navy last week, and the company also informed investors in May that it would increase its quarterly dividend by more than 10%. Zimmer Biomet Holdings Shares of medical device maker Zimmer Biomet have struggled this year, losing about 11%. The stock’s 50-day moving average crossed above its 200-day moving average earlier this year – a short-term sign of bullish momentum. On Tuesday, shares fell more than 3% after the company’s management noted that quarterly results may not be “linear” going forward, raising concerns about Zimmer’s growth prospects going forward. next time. Zimmer is one of the worst-performing stocks year-to-date in the S&P 500 healthcare sector. IDEX Corporation Laboratory equipment maker IDEX also made the list. The stock is down about 5% after briefly forming a golden cross – its 50-day moving average standing above its ascending 200-day moving average – earlier this year. However, the stock has fallen more than 11% since April 23, when IDEX issued weaker-than-expected second-quarter earnings guidance. Other stocks on the list that signal a death cross chart pattern include Pool Corporation and Fortive Corporation. – CNBC’s Nick Wells contributed to this report.
