Investors piled into Merck & Co. and S & P Global , among others, with 2026 around the corner. Those names may be due for a pullback. The three major averages all climbed this week, which was shortened because of the Christmas holiday. The S & P 500 led the way with a 1.4% gain. The Nasdaq Composite was up 1.2% along with the Dow Jones Industrial Average . However, some individual stocks may be over their skis and due for a retracement. CNBC Pro used its stock screener tool to identify the most overbought and oversold stocks on Wall Street as measured by their 14-day relative strength index, or RSI. Stocks with a 14-day RSI above 70 are said to be overbought, meaning that they could be soon due for a potential rebound. On the other hand, a reading below 30 indicates that a stock is oversold and that a rebound could be on the horizon. The table below shows stocks with an RSI above 70 that also rose at least 3% for the week, as of Friday morning. With an RSI of 73, one standout name on the list was Merck. Shares of the pharmaceutical giant were up 5% on the week. Last week, BMO Capital Markets upgraded the stock to an outperform rating. “Following a course reversal for Merck sentiment, driven by stabilizing Gardasil estimates, recent U.S. government agreements, and positive trials like CADENCE, we believe investors see more upside to MRK in the near term,” wrote analyst Evan Seigerman. “While not all questions have been answered to replace Keytruda revenue, we see a credible path to solve most of the picture with upside still attainable regardless of mild [earnings per share] contraction through the [loss of exclusivity].” S & P Global, up 3% this week and with an RSI of 72, was another name on the most overbought list. Morgan Stanley named the stop one of its top picks in a 2026 outlook, published last week. “SPGI has already de-risked following its Investor Day in November where the company provided growth and margin targets that were within the levels of prior expectations,” wrote analyst Toni Kaplan. On the other hand, there were some names that entered oversold territory, signaling they may be due for a jump. The table below shows stocks with an RSI below 30 that have also slipped at least 1% week to date, as of Friday morning. Coming in with an RSI of 28, Lennar fell 3% this week. Last week, several Wall Street shops downgraded the homebuilder to an underperform rating, including Bank of America, Evercore ISI and RBC Capital Markets. Bank of America analyst Rafe Jadrosich said that his downgrade came after Lennar issued fourth-quarter results and first-quarter guidance that came in well below expectations. “We are reducing our FY2026/FY2027 EPS estimates by (24%)/(14%) to reflect a weaker margin and revenue outlook,” he wrote. “LEN shares declined (5%) versus (1%) for the S & P 500, and we see further downside risk as the stock continues to trade at a premium despite lower ROTE and more pronounced margin and return-on-equity headwinds relative to peers.” Lamb Weston, DataDog and Marathon Petroleum rounded out the list of oversold stocks.
These are the most overbought S&P 500 stocks as 2026 approaches
