What are the hot stocks for tomorrow, Thursday, Jan. 25? You probably already know that the headlines are going to be dominated by earnings.
That’s particularly true as we started hearing from a bunch of companies on Tuesday morning. That was followed by Microsoft (NASDAQ:MSFT) after the close, Boeing (NYSE:BA) before Wednesday’s open and Tesla (NASDAQ:TSLA) due up after the close.
The start of earnings season coincides with the S&P 500 trying to clear last week’s high and some stiff resistance that’s plagued the index over the past few quarters. With that in mind, let’s look at a few hot stocks for tomorrow.
Hot Stocks for Tomorrow: Airlines (AAL and LUV)
We’ve already heard from Delta Air Lines (NYSE:DAL) and United Airlines (NASDAQ:UAL). However, the group as a whole has traded incredibly, incredibly well lately. That may surprise some investors, given the fears of a global recession that continue to make the headlines.
However, it’s quite clear that air traffic demand has been robust and that should bode well for this group. We’ll get more insight when American Airlines (NASDAQ:AAL) and Southwest Airlines (NYSE:LUV) report earnings.
Both companies will report before the open on Thursday. Of course, the reports are likely to focus on different aspects. Of the major carriers, American Airlines (shown above) has been the best performer amid the recent rally. Southwest has been the worst given the awful fallout it had with the thousands of cancellations it was plagued with last month.
The Chart: Shares have already pulled back to active support. If they pull back further on the print, I’m watching the $15.50 area, which was prior resistance and is near the recent gap-fill. Below that opens the door to the $14.75 to $15 zone. On the upside, keep an eye on $17.50. An eventual move above this level could put $19 to $19.50 in play.
Credit Cards (MA and V)
So far, MasterCard (NYSE:MA) and Visa (NYSE:V) have done a pretty good job of avoiding a selloff. That may surprise some, given the fears of a recession. We’re starting to see a concerning trend as consumer savings continue to fall, while credit card balances continue to rise.
To some extent, that is a positive for these companies, and clearly, consumers are still spending (inflation is helping in that regard). Now running bigger balances, Visa and MasterCard have short-term catalysts in play.
The question really becomes, will we face a recession and if so, how bad will it be? That’s where these two names are vulnerable. On a “right now” basis, Visa and MasterCard should give investors great insight into the health and activity of consumers when they report earnings. MasterCard reports before the open on Thursday, while Visa reports after the close.
The Chart: Try to ignore this week’s crazy price action bar, which is the result of some issues at the NYSE on Tuesday. On a weekly basis, bulls want Visa to hold the $215 level. Below that and the $200 to $205 zone is the key area to hold. On the upside, $235 has been resistance. Above that puts $250-plus on the table.
Hot Stocks for Tomorrow: Vaccine Stocks (PFE, MRNA, BNTX)
Last but not least, we have vaccine stocks in play as potential hot stocks for tomorrow. That’s as the “FDA will hold a meeting on COVID-19 boosters.” That could be relevant for Moderna (NASDAQ:MRNA), Pfizer (NYSE:PFE), BioNTech SE (NASDAQ:BNTX) and others.
After an initial wave of vaccinations, momentum has waned. That’s no surprise, though.
Many individuals opted for the initial vaccinations against Covid-19 and millions of people also accepted the booster. However, momentum for the vaccines has slowed and we can see that in the stock charts too.
Still, keep this potential catalyst in mind when watching these stocks.
The Chart: Looking at Pfizer, the stock has been range-bound between $41 and $55 for quite some time. Currently down in four straight weeks, Pfizer is trying to find its footing near last week’s low of $44.64. Above that level and perhaps we can see a short-term rebound to $46, then potentially $48. However, longer-term traders can continue playing the ranges.
Pfizer will report earnings on Tuesday, Jan. 31.
On the date of publication, Bret Kenwell held a long position in TSLA and MSFT. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.