What Happened?
A number of stocks fell in the morning session after investors took some profits off the table as markets awaited signals on future monetary policy from the Federal Reserve's Jackson Hole symposium later in the week.
The downturn in the market was largely attributed to a significant sell-off in megacap tech and chipmaker shares. Nvidia, Advanced Micro Devices (AMD), and Broadcom all saw notable drops, dragging down the VanEck Semiconductor ETF. Other major tech-related companies like Tesla, Meta Platforms, and Netflix were also under pressure.
A key reason for this trend is that much of the recent market gains have been concentrated in the "AI trade," which includes these large technology and semiconductor companies. So this could also mean that some investors are locking in some gains ahead of more definitive feedback from the Fed.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Heavy Transportation Equipment company Commercial Vehicle Group (NASDAQ: CVGI) fell 4%. Is now the time to buy Commercial Vehicle Group? Access our full analysis report here, it’s free.
- Engineering and Design Services company Sterling (NASDAQ: STRL) fell 3.3%. Is now the time to buy Sterling? Access our full analysis report here, it’s free.
- Maintenance and Repair Distributors company DXP (NASDAQ: DXPE) fell 4.2%. Is now the time to buy DXP? Access our full analysis report here, it’s free.
- Engineered Components and Systems company Graham Corporation (NYSE: GHM) fell 3.5%. Is now the time to buy Graham Corporation? Access our full analysis report here, it’s free.
- Waste Management company Montrose (NYSE: MEG) fell 3.1%. Is now the time to buy Montrose? Access our full analysis report here, it’s free.
Zooming In On DXP (DXPE)
DXP’s shares are very volatile and have had 23 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 10 months ago when the stock gained 21.5% on the news that the company reported strong third-quarter earnings. DXP blew past analysts' sales, EPS, and EBITDA estimates as its acquisition-driven strategy continued to pay off. Notably, the company closed five acquisitions through the third quarter and already added two more for the next quarter. Zooming out, we think this was a good quarter with some key areas of upside.
DXP is up 37.5% since the beginning of the year, and at $116.06 per share, it is trading close to its 52-week high of $122.29 from August 2025. Investors who bought $1,000 worth of DXP’s shares 5 years ago would now be looking at an investment worth $6,070.
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