This week’s most overbought stocks in the S&P 500 include several tech companies


Investors favor certain stocks as they weigh the possibility of a Federal Reserve rate hike later this year. Wall Street has just come off a week of losses, with the Nasdaq Composite Index falling by 1.9%, the S & P 500 dropping 1.3%, and the Dow Jones Industrials losing 0.8%. CNBC Pro screened FactSet data based on the 14-day relative strengths index (RSI) to find the names that were overbought or oversold in the S & P 500. The relative strength index is a popular way to determine whether shares are overbought and oversold. It measures the magnitude of price movements as well as their speed. Stocks with a RSI of less than 30 are oversold and could represent a good entry point for investors. Stocks with RSIs above 70 indicate that they may be a great opportunity to sell. The technology sector was the most overbought in this past week. Many technology stocks have struggled recently, but recovered their footing by Friday. Most of the oversold shares were in the healthcare, consumer, and industrial sectors. Intuit, maker of TurboTax software and Credit Karma, is the S & P 500’s most overbought name with a 14 day RSI over 95. Over two-thirds (67%) of the analysts who cover the financial software firm rate it as a buy. However, the average price target suggests a less than 1% increase. Intuit has seen its shares rise by almost 42% this year. This is due to strong earnings from the fiscal fourth quarter, and enthusiasm surrounding Intuit’s investments in artificial AI and generative AI. The company announced Wednesday that it has added Intuit Assist, a product powered by generative AI. IBM has an RSI over 85, despite the fact that only 28% of analysts rate it as a buy. According to FactSet, their average price target indicates a 1.3% decline. The shares have gained almost 5% since 2023. Accenture’s stock is overbought as well, with 56% of analysts rating it a buy. It has a RSI above 83. The average price target for the company suggests that shares could rise by 3.3%. Piper Sandler’s chief market technologist recently told CNBC that stock was a “stealthy” way to think of AI. Accenture announced in mid-June its plans to invest $3 Billion over the next 3 years in their data and AI practice. Baker Hughes, a provider of oilfield services (RSI 85), Autodesk, a manufacturer of architecture and manufacturing software (84), and Verisk Analytics are also overbought. Alaska Air Group, which continues last week’s trend, has the largest projected upside (+60%) on the list. Seattle-based airline has a 14 day RSI under 17, and 80% of analysts rate the stock as a buy. Walgreens Boots Alliance, another oversold company in the S & P 500, is also a top performer. The drugstore chain operator’s RSI is below 9 and less than 6% analysts rate the stock as a buy. FactSet reports that Walgreens’s average price target is more than 40% higher. Walgreens, whose stock has fallen nearly 41% in the past year, is struggling after demand for Covid vaccines and tests dried up. Walgreens’ ex-CEO left abruptly earlier this month, after 2.5 years in the position. Viatris had the lowest 14-day RSI of any company in the S & P 500. Viatris, which will be formed by the 2020 merger of Mylan’s Upjohn and Pfizer’s Upjohn, has a price target that implies a 23% increase in value, but only 9% of Wall Street analyst rate it as a buy. Dollar Tree, Dollar General and chemical producer FMC are among the oversold companies on the S & P 5000.