The Dow Jones Industrial Average rose more than 375 points on Wednesday morning following consumer and housing data. FedEx (FDX) and Nike (NKE) stocks rose sharply in the morning session after companies announced business results.
Economic data Wednesday morning includes consumer confidence and existing home sales. The December consumer confidence index will be closely watched after last week’s data showed a surprise drop in consumer spending in November. The index is estimated at 108.3 in December compared with 100.2 in November.
Meanwhile, November’s existing home sales fell even further, to an annualized rate of 4.09 million from October’s 4.43 million. On Tuesday, housing data was mixed. in contrast, where housing starts to exceed estimates and new permits fall short of consensus targets. Home construction stocks have been showing signs of strengthening recently, with three names shortlisted IBD 50 in this week.
FedEx and Nike reported their quarterly earnings results after the close on Tuesday. FedEx Stock increased by 6%, while Nike stock up to 15%. The power of Nike has helped propel adidas (ADDYY) and footboard (FL) shares. Adidas is up nearly 7%, while Foot Locker is up 3.6%.
energy giant Dow Jones letter V (CVX) was the top performer in the Dow 30 as declining weekly supply data helped push oil prices higher. CVX stock rose more than 1%. Dow Jones Technology Leader Apple (AAPL) and Microsoft (MSFT) is traded higher after stock market today open.
electric car giant Tesla (TSLA) reversed 2% higher on Wednesday morning, as CEO Elon Musk pledged to step down as his CEO on the social networking site Twitter.
IBD Rankings Share Neurobiological Science (NBIX), KLA (KLAC), O’Reilly . Auto Parts (ORLY) and Flowers for rent (URI) — as well as the name of Dow Jones Amgen (AMGN), caterpillars (CAT) and warehouse at home (HD) — among the top stocks to consider on an investor’s watchlist.
Neurocrine and United Rentals are IBD Rankings share. UnitedHealth has been featured in the last week Stocks near the Buy Zone column. Recent Caterpillar and United Rentals IBD shares of the day companies.
Dow Jones today: Oil prices, Treasury yields
After Wednesday’s opening bell, the Dow Jones Industrial Average rose 1%, while the S&P 500 gained 0.7%. The tech-heavy Nasdaq composite followed with a 0.5% gain in morning trade.
The yield on the 10-year Treasury note fell to 3.64% on Wednesday morning, pausing after a surprise move by the Bank of Japan boosted global bond markets and sent US yields up to 3. .68 percent on Tuesday.
Meanwhile, US oil prices traded up about 2% on Wednesday, as industry data from the American Petroleum Institute showed US crude inventories fell by about 3.1 million barrels last week, more than expected. The official weekly data comes from the Energy Information Administration at 10:30 a.m. ET. West Texas Intermediate futures rose to nearly $78 a barrel in morning trading.
Stock market recovers under pressure
On Tuesday, the S&P 500 ended the trading day with a slight gain of 0.1%. The benchmark index is still stuck below 50 day moving average, although it is still within striking distance. Nasdaq composite closed the session essentially unchanged. The tech-heavy index is still down nearly 33% so far in 2022. The index is 3.5% below its 50-day moving average and nearly 9% below its December 13 peak.
Tuesday’s The Big Picture Category comments: “Investors should note that while the indices have recovered slightly, it has not been a decisive move. As the market has fallen into oversold territory, a strong rally is expected. than to be expected.”
Now is a great time to read IBD . Big Picture Column in the context of stock market volatility.
Notable Dow Jones Stocks: Amgen, Caterpillar, Home Depot
Pharmaceutical maker Amgen is building a new flat footing after a big move in mid-November, but the stock is below its 50-day moving average after plummeting in recent weeks. Right now, the exact buy point is at 296.77, but the stock needs to re-exercise 50 days ago definitively. AMGN stock fell 0.1% on Wednesday.
Dow Jones member Caterpillar continues to trade near a 239.95 buy point in a flat base, based on IBD MarketSmith . Pattern Recognition, after rising 1.2% on Tuesday. The stock has found support at the stock’s 21-day exponential moving average in recent days, and the stock’s relative strength line is approaching new highs. CAT stock rose 1.6% on Wednesday.
Home improvement retailer Home Depot is about 4% below a cup base’s 329.77 buy point after reversing last week’s breakout move. HD shares traded up 1.3% Wednesday morning.
Top stocks to watch: KLA, Neurocrine, O’Reilly, United Rentals
Chip gear leader KLA has mostly held up amid the market weakness and is about 2% below cup-with-handle’s 392.60 entry following Tuesday’s modest drop. KLA stock traded up 0.7% on Wednesday.
IBD Rankings Neurocrine stocks continue to find support at the 50-day level amid a bullish two-day streak. A strong bounce would be bullish for the stock’s immediate outlook and potentially lead to the formation of a new base. Meanwhile, a strong breach could mean the stock needs more consolidation. NBIX shares were up 0.4% on Wednesday.
O’Reilly Auto Parts is also finding much-needed support at its 50-day line this week and remains just above a flat base of 750.98. A major bounce off the 50-day line could provide the next entry, but the market’s bulls are currently under pressure, which increases the risk of buying the stock. ORLY stock was up 0.4% on Wednesday.
United Rentals is still just below the 368.04 point of purchase in one cup with handle sample. The stock is about 5% below the buy point and further weakness will trigger the 7%-8% loss rule. URI shares rose 1% on Wednesday.
stocks to watch
These are the top five stocks to watch in today’s stock market, including the top three Dow Jones stocks.
|Company name||Icon||Exact point of purchase||base type|
|KLA||(KLAC)||392.60||cup with handle|
|Flowers for rent||(URI)||368.04||cup with handle|
|warehouse at home||(HD)||329.77||cup with handle|
Source: IBD Data as of December 20, 2022
Tesla shares fell another 8.05% on Tuesday, hitting another 52-week low and trading as low as 137.66. Shares were up more than 2% Wednesday morning, reversing higher after hitting a new 52-week low at 135.89.
On Tuesday, TSLA stock hit its lowest level since November 2020. Shares closed down about 66% from their 52-week high.
Leading Dow Jones: Apple, Microsoft
Between Dow Jones stockShares of Apple fell slightly on Tuesday, cutting losses after narrowly hitting a new 52-week low, set on June 16 at 129.04. Shares are down about 28% from their 52-week high. Shares traded up 1% on Wednesday.
Microsoft was up 0.6% on Tuesday, as the stock held support around the 50-day line after breaking a three-day losing streak. The software giant is still down about 30% from a 52-week high. MSFT stock rose 0.2% early Wednesday.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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