As earnings season continues, investors have the opportunity to profit from strong stock price gains or avoidance of declines following these quarterly reports. It’s been an unstable week. The S&P 500 rose to an intraday high of 7,501.24 on Thursday as the first quarter earnings season continued to be strong. But broad market indexes lost some of those gains in Friday trading, with tech stocks tumbling as investors disappointed with the outcome of the U.S.-China summit. Despite this move, Cisco’s stock price rose 22% in a week on strong gains, sending the stock into overbought territory. If the relative strength index is above 70, the stock is considered overbought. Stocks in this category may fall in the short term. Conversely, some stocks ended the week in oversold territory. Oversold stocks have an RSI below 30, which could prompt a short-term rebound. Here are some of the most overbought and oversold S&P 500 stocks over the past week. Overbought Cisco stock has an RSI of 90, which puts it at the top of this week’s list. The software and artificial intelligence infrastructure company on Wednesday reported better-than-expected fiscal third-quarter results and gave a bullish outlook for the fourth quarter. Investors were excited by strong orders for the company’s AI products, and the company received a stock rating upgrade from HSBC and other high street stores. The overbought list also includes names like Humana, Palo Alto Networks, and CVS Health. Oversold Zoetis topped the oversold list with an RSI of 14.4. The animal health company’s stock has fallen 10% over the past week. The stock is trading at its lowest level since 2019 after announcing on May 7 that first-quarter profits were lower than expected. Zoetis also lowered its earnings per share and revenue guidance for the current fiscal year, underwhelming investors. The company said pet owners are feeling price pressure and are reducing trips to the vet. In fact, they often choose cheaper products, hurting demand for Zoetis’ higher-end medicines. Domino’s Pizza and Lululemon Athletica are among the other companies on the oversold list that could rebound. —CNBC’s Christina Cheddar Burke contributed to this report.
