Penny stocks have not been as popular as you might think over the last few weeks. Thanks to plenty of economic uncertainty and concerns over inflation, investors have pulled back on risk. However, that doesn’t mean traders are dealing the same.
Anyone who’s swing trading, day trading, or scalping is loving this type of volatility in the stock market today. Is that a big pullback in the SPY? Who cares as long as you know how to find the best penny stocks to buy, right?
Of course, it’s easier said than done. But it is possible all the same and it is happening daily. Even with the stock market down today, there are more than just a handful of cheap stocks making big moves. Look at tech companies like Mmtec Inc. (NASDAQ: MTC). Not only has the penny stock been on an absolute tear over the last few weeks, but shares have also climbed another 60% on Friday.
Overall, MTC stock’s price has rallied more than 400% since last Friday’s close. Now, if you were to look at the overall tech sector in the stock market today or the tech-heavy Nasdaq ETF – QQQ – it’s a night and day difference. The Qs are hovering around their October lows on October 20.
How Global Events are Impacting the Stock Market
Middle East Conflicts Cause Turbulence
Lately, the stock market has been on a rollercoaster ride, reacting to stuff happening around the world. At first, stocks took a dip when the 10-year Treasury yield spiked to 5% before pulling back. Major indexes dropped over 1% as investors got worried about rising yields and earnings reports.
Then, tensions in the Middle East added to everyone’s anxiety, especially with Israel and Hamas fighting and airstrikes happening. Oil prices surged because of all this, which affected global markets. Experts say if the U.S. gets involved militarily in the Middle East, we could see oil prices rise by $20 per barrel. This shows how sensitive stocks are to world events.
In Asia, shares slid amid escalating Middle East conflicts and investors getting risk-averse. Besides stocks, crude and gold prices also went up due to supply concerns and demand for safe havens in case things get worse in Israel and Hamas.
Earnings Reports Paint a Mixed Picture
Amidst the worrying world events, the market is also dealing with mixed earnings reports from major companies this quarter. The good and bad news in earnings has sent investors looking for a common thread, as they try to find stability with so much uncertainty both in the U.S. and globally. All this shows the market is in flux, reacting to economic indicators at home and conflicts abroad.
It highlights how connected world markets are, with global events influencing investor sentiment. With such a trend, high-volatility stocks are gaining more attention from short-term traders. Penny stocks have presented interesting prospects. In this article, we look at a handful of cheap stocks under $5 gaining momentum in the stock market today.
Penny Stocks To Buy? 3 To Watch
Penny Stocks to Watch 1. Aravive Inc. (NASDAQ: ARAV)
Shares of Aravive stock have climbed higher for the last few weeks. Prices put in new 52-week lows of 11 cents, and before it became on of the Nasdaq penny stocks under 10 cents, ARAV stock bounced. It continues at the end of the week now up nearly 100% since then.
The company was hit hard in the market after its Phase 3 AAXLerate-OC study missed its primary endpoint in August. Gail McIntyre, Ph.D., DABT, Aravive’s President and Chief Executive Officer responded to the results saying, “We are conducting additional analyses on the AXLerate-OC Phase 3 trial to further evaluate the results of this study and determine the best path forward with our two other planned indications in renal cell carcinoma and pancreatic cancer.”
Although no further communication has come up recently, ARAV stock has gained some speculative interest this week.
Hub Cyber Security (NASDAQ: HUBC)
Hub Cyber is one of the otherwise very quiet penny stocks to watch that exploded recently. There haven’t been any news headlines from the company in weeks and daily volumes were extremely low heading into October.
However, with the rise of interest in cybersecurity stocks, cheap stocks like HUBC have gained speculative attention. What does the company do? It isn’t going to be competing with the likes of Palo Alto Networks (NASDAQ: PANW) anytime soon from the look of earnings. This speculation has helped fuel a move that has allowed HUBC stock to far outpace anything PANW stock has done from a percentage-change perspective.
Last month Hub gave a series of updates and plans to further build upon its growth. This included a new line of products to enhance Zero-Trust security for its clients. The company’s flagship Hub Secure File Vault has also undergone a transformation to become more robust for large enterprises and governments.
Against this backdrop Uzi Moskowitz, CEO of Hub Security, stated, “These updates represent our unwavering commitment to our clients, investors, and employees. We are navigating these transformative times with resilience and determination, focusing on innovation and financial stability to emerge stronger than ever.”
JetBlue Airways Inc. (NASDAQ: JBLU)
We wrote about JBLU stock (See: Will JetBlue (JBLU) Be On Your List Of Penny Stocks In 2023?) before gracing the penny stock stage and as share prices took a nosedive last quarter. Now, it may seem that some hope for the penny stock to finally take flight.
As share prices rebound, options action has picked up. More than 67,000 contracts of open interest are showing in the 10/20 $5.00 Calls in the stock market today, which is where the bulk of the action appears.
JetBlue recently announced the record and payment dates for October’s prepayment to Spirit stockholders. This is related to the plan of merger with Spirit Airlines. The end of September saw JetBlue announcing it would raise flight attendant pay next year and provide other bonuses, which appealed to the unions. Flight attendants will get 5% raises starting in November. A JetBlue spokesman said, “Because our inflight crewmembers play a significant role in delivering the JetBlue experience, it’s important that we’re able to attract and retain high-quality crewmembers with competitive pay and benefits.”
With this, JBLU stock has slowly clawed back some of its losses over the last month but is still trading significantly lower than in June.