The Dow Jones Industrial Average fell on Thursday as oil prices soared as investors heeded President Donald Trump’s warning that the Iran war could continue for several more weeks. Against this backdrop, certain names have dropped significantly this week. The market downturn has pushed some stocks in the real estate, consumer staples, health care and technology sectors into oversold territory, potentially leading to a near-term rebound. Topping the list of oversold stocks is Nike, which received a downgrade from several stores on the street after releasing lackluster sales forecasts on Tuesday. A stock is considered oversold when the relative strength index falls below 30. The most oversold stocks in the S&P 500 are: Oversold stock Nike has topped the list of oversold stocks as investors fret that the company’s turnaround is taking longer than expected. The name has an RSI of 15.8 after the stock fell 14% last week. Nike on Tuesday said it expects fourth-quarter sales to fall between 2% and 4%, below analysts’ consensus estimate for a 1.9% increase, according to LSEG data. Executives cited several reasons for the cash crunch, including turmoil in the Middle East and rising oil prices, which could raise costs and hurt consumer demand. Nike also said it expects sales to decline by low single digits through the calendar year, driven by growth in North America and offset by declines in China. Analysts who lowered the stock’s price primarily said the new forecasts indicate Nike’s turnaround will take longer than expected and could be further delayed by tough economic conditions. “NKE is beginning to realize the early green shoots of its sports offense strategy in North America and the running category, but its portfolio including international regions (EMEA, Greater China, APLA) “Rio’s balance remains as efforts to reset the market continue and sell-through results remain a challenge globally, resulting in an extended timeline for this model to reach the revenue growth inflection point and return to double-digit operating margins.” Other companies in oversold territory include Universal Health Services, McCormick & Company, and Lennar. McCormick stock has fallen 8% over the past week. On Tuesday, the condiment company announced plans to acquire Unilever’s global food business. The deal values Unilever’s food brands, including Hellmann’s Mayonnaise, at approximately $45 billion. Unilever shareholders will own approximately 55.1% of the combined company, with Unilever owning 9.9%. The merger follows a consolidation trend in the food industry, where companies seek to increase scale and influence, but the industry has a mixed track record in achieving mega-deal outcomes.
