Watch these small-cap plays, Microsoft and this Nasdaq 100 top performer in tomorrow’s trading

TUE, JAN 24, 2023

The goal of this newsletter is to get you ahead of the next day of investing and trading. It's your first look at tomorrow and last look at today powered by the team of people who direct CNBC TV's stock market coverage.

Tomorrow's Top CNBC Stories Tonight

Intuitive Surgical's results are here

Intuitive Surgical fell more than 13% in the extended session after revenue and earnings missed analysts' expectations. The company cites the resurgence of Covid-19 in China, saying it negatively affected procedure volumes in the region. The stock was up 17% in three months as of Tuesday's close, but a rough start to the year was already eating into those gains. With tonight's move, the stock is on track for its worst month since April.

Travelers jumps on quarterly results

Travelers led insurance names higher after reporting quarterly results that were in line with last week's warning, though revenues came in slightly ahead of analysts' expectations. Today's gains put the stock in positive territory for the month and within 1% of a fresh all-time high. Elsewhere in the SPDR S&P Insurance ETF (KIE), some smaller names are up double digits so far this month, including First American Financial, Trupanion, Fidelity National and Kemper.

A standout performer in the Nasdaq 100

Align Technology is one of the best performers on the Nasdaq 100 over the past month and up 20% so far in January. While that would be its best month since October 2020, it's still more than 50% off its recent high. Analysts are bullish, with 75% of those tracked by FactSet rating ALGN a buy, though it is trading at a premium to its average price target.

Ethan Kraft | CNBC Breaking News and Markets Producer
@ethan_kraft

Small caps, big gains

The Russell 2000 dropped Tuesday, but it's still up 7% in 2023, beating out the other major indices except for the Nasdaq so far this year.
One way to play it is the iShares Russell 2000 ETF (IWM), which tracks the small-cap index.
CNBC Pro did a nice write up of the small-cap stocks Jefferies think will continue leading.
On the list: Bloomin Brands, up 16% in 2023.
Dave & Buster's, also up nearly 16% in 2023.
Arch Resources, up 9.5% in 2023.
Navient, up 5.6% in 2023.
Addus HomeCare, up 10% in 2023.
Methode Electronics, up 4.4% in 2023.

Microsoft's quarterly earnings, after-hours moves

By now, you probably know that Microsoft's stock initially jumped after the company reported quarterly results. The stock was up 4% after hours, but the gains reversed after the company shared disappointing guidance on its earnings call. Microsoft is up 23% off the 52-week high and flat so far in 2023.
Also in the software as a service space: ServiceNow was up 2% after hours. It is 29% off the 52-week high and up 14% in 2023. The company reports results after the bell Wednesday.
Salesforce was up 1% after hours. The stock is 34% off the high and is up 17% in 2023.
Cognizant and Oracle weren't moving after the bell. Both stocks are within 10% of their highs. Cadence is up 11.7% in 2023, and Oracle is up 10% in 2023.

News reports say that the U.S. may soon agree to send tanks to Ukraine

General Dynamics is the big player behind the Abrams tank. While it might not be enough to really move the stock, GD is down 5% so far in 2023 and 8% from the 52-week high. It's up 13% in 12 months. The company reports results tomorrow morning.
Elbit is tops in defense so far this year, up nearly 5% but still 30% from the 52-week high.
Northrop Grumman is down 15% in 2023.
Booz Allen is down 8% in 2023.
Lockheed Martin is down 7% in 2023, despite jumping almost 2% today on its quarterly report.
Leidos, which helps drones operate, is down about 7% in 2023.
Huntington Ingalls is down 4.5% in 2023.
Raytheon, which picked up more than 3% today after posting quarterly results, is down 1.4% in 2023.

Lots of big quarterly reports are coming tomorrow

Boeing, which is up 11% in 2023 and only 5% from the 52-week high.
Freeport-McMoRan, up 17% so far this year.
Norfolk Southern, up about 4% so far this year.
CSX, up nearly 3% so far this year.
Tesla, up 17% so far in 2023, but 62.5% from the 52-week high.
Levi Strauss, up 7.7% in 2023.
SL Green, up 9% in 2023 and paying a hefty 8.8% dividend as of today. The stock is still 56% off the March high.
United Rentals, up roughly 11% so far this year. It's 10% from the 52-week high.