Dow Jones and S&P retreat as Nasdaq Pares gains

The Dow Jones Industrial Average ended lower to start the first week of the fourth-quarter earnings season. The blue chip index was down 0.3% at the closing bell on Monday after rising nearly 1% earlier in the day. It remained above its 50-day moving average.




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The S&P 500 also reversed lower and closed down 0.1%. It had crossed its 50-day line today but closed below it. The Nasdaq led with a 0.6% gain and fell after approaching the 50-day line. The small-cap Russell 2000 ended up 0.2%, although it also gave up much of its gains.

Volume rose on the NYSE and fell on the Nasdaq, according to preliminary data.

Several stocks moved above the buy points, but some faded below the entries. modine (MOD) and Amkor (AMKR) was still holding and the volume was good. Modine is in a buy zone from a buy point of 22.23. Amkor is in a buy zone from the buy point of a cut basis of 29.20.

SLB (SLB) fell slightly from its buy point of 56.14. The volume was low. Oil and Gas Drilling Services Company Halliburton (HAL) broke away from a handle cup base and a buy point of 40.09.

The Innovator IBD 50 (FFTY) ETF was up 0.2% by the end of the day.

Crude oil rose 1% to trade at $74.80 a barrel. The yield on the benchmark 10-year Treasury fell 5 basis points to 3.55%.

According to the latest data from S&P Global Market Intelligence, real GDP grew to 2% in 2022. Strong November trade and inventory figures led to above-trend GDP growth in the second half of the year.

Joel Prakken, co-head of the U.S. economy at S&P Global Market Intelligence, said: “An emerging risk is that the economy will remain stronger for longer than expected, requiring more aggressive and persistent monetary tightening to prevent a higher inflation to take root”.

A mild recession remains a strong possibility in the first half of 2023.

Stocks move today

Shares of Uber (UBER) rose nearly 4% after an upgrade to overweight Piper Sandler analyst Alexander Potter. The new price target is 33. Uber forms a base with a buy point of 31.92.

Also in place after an analyst upgrade Oracle (ORCL). It earned an overweight rating from Piper Sandler analyst Brent Bracelin with a price target of 104, down from 85. Shares were up nearly 1% in today’s session. The stock’s relative strength line is also at a 52-week high.

Somewhere else, Regeneron Pharmaceuticals (REGN) is down more than 7% and is on course for its biggest decline since March 20, 2o20. In its preliminary update, Eylea’s sales of $1.5 billion were below FactSet’s estimate of $1.64 billion.

caterpillar (CAT) is in a buy zone from a cup with handle base and a buy point of 238. CAT is on the IBD rating.

Bed bath and beyond (BBBY) jumped more than 20% on strong volume even as bankruptcy haunts the homewares business. The shares, however, are trading below 1.70. Winnings are due Tuesday.

Commercial lease stocks broke. McGrath RentCorp (MGRC) came out of a flat base with a buy point of 100.40 on Friday and is back below the buy point today. H&E Equipment Services (HEES) reversed lower but is still in a buy zone after breaking above 47.27.

Retail inventory Macy’s (M) and lululemon (LULU) fell more than 7% each after warning of dismal holiday season sales.

Earnings on deck for Dow Jones stocks

Trade metals (CMC) fell after strong earnings today. Stocks are in a buy zone after the stock found support at the 10-week moving average.

On Friday, Dow Jones executives JPMorgan Chase (JPM) and UnitedHealth (UNH) will release its earnings ahead of the open. JPM is approaching a buy point of 138.76 in a flat basis. UNH is well below its 50-day line.

Please follow Vramakrishnan @IBD_VRamakrishnan for more stock market news today.

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