The Dow Jones Industrial Average traded lower in today’s stock market, with all major indices showing declines in afternoon trading. The S&P 500 and the composite Nasdaq reversed downward after a brief positive trade, while the Dow was trading close to its daily lows.
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About an hour before the market closed, the Russell 2000 dropped more than 3%, leading the market downwards. At around 3:15 pm ET, the Nasdaq compound dropped 1%. The S&P 500 lost 0.6%, while the Dow Jones industrials fell 0.8%. The volume was trading higher on the Nasdaq and the NYSE compared to the same time on Monday.
On Tuesday, investors considered the testimony of Fed chief Jerome Powell and Treasury secretary Janet Yellen. At a hearing on the US House Financial Services Committee, Yellen and Powell made their first joint appearance to talk about the government’s Covid-19 relief efforts. Powell told lawmakers that the economic recovery has progressed more quickly than expected and appears to be strengthening. But he also said the recovery was far from complete.
In addition, the growing cases of Covid-19 prompted Germany to announce a one-month extension to its rigid blocking measures early Tuesday. However, in the United States, many states are easing restrictions and there are signs of hope as vaccinations are launched and cases start to stabilize and even drop in some states.
Cumulative cases of Covid-19 worldwide have risen to more than 124 million, with more than 2.7 million deaths, according to the Worldometer. In the United States, cases reach 30.6 million, with more than 556,000 deaths. On the positive side, the number of new cases in the United States has dropped dramatically.
Large-cap technology stocks outperform
As of Tuesday, oil and gas, retail and biotechnology stocks were lagging among IBD’s 197 industrial groups. WTI crude oil futures fell more than 6% to $ 57.74 a barrel, according to OilPrice.com.
But several industry groups related to the technology have shown renewed strength. The few winners included software, Internet retail and film-related stocks. High capitalization technology actions, such as Netflix (NFLX), Amazon.com (AMZN) and Alphabet (GOOGL) all with superior performance.
Netflix’s shares, featured on Tuesday’s IBD Live program, were up 3.5% in heavy trade as the shares rebounded the 50-day moving average for the first time in nearly three weeks. Argus Research has updated Netflix’s shares to a standby purchase with a target price of 560. The film and TV show streamer is working on a superficial nine-week consolidation with a purchase point of 593.39.
About that, Adobe (ADBE), which reports earnings on Wednesday after closing, rose nearly 3% in an attempt to recover its recently converged 50- and 200-day lines. Shares remain in a downward trend, as the Relative Strength Rating has dropped to 19 out of the best possible of 99. The RS line has also fallen in recent months.
Zacks’ consensus estimate is adjusted earnings of $ 2.79 per share, an increase of 23% year on year, with sales of 22%, to $ 3.77 billion.
As for growth stocks, the Innovator IBD 50 ETF (FFTY) fell by more than 3%. The growth-focused index was trading below support on the 50-day line after recovering this key area last week. Shares leading the downside on Tuesday were Cowen (COWN), GrowGeneration (GRWG) and Pharmaceutical Binder (LGND) with losses greater than 5% each.
But a small handful of IBD 50 stocks initially resisting the decline included Zebra Technologies (ZBRA), PTC (PTC) and Vipshop (VIPS), up to about 1% each. But the first two returned the winnings. VIPS maintained a slight gain of 0.6%.
Dow Jones Today
As for the Dow Jones, Proctor & Gamble (PG), Microsoft (MSFT) and Walmart (WMT) led the rise with gains of more than 1% each. On the negative side, the shares of Dow (DOW) and Boeing (BA) decreased 3.5% or more each.
Microsoft’s leaderboard shares gained about 2% when trading above the 50-day line. Microsoft is also a stock of the IBD Long-Term Leader. The shares rose again above 232.96 points of purchase, which puts the software giant in a potential purchase range that reaches 244.61.
The stock is also approaching a 246.23 point-of-purchase for a new flat base, according to analysis by the MarketSmith chart. Microsoft’s stock is about 2% away from the entrance.
Elsewhere, Intel shares lost nearly 3% on Tuesday, with the shares being traded below the 5% buying zone of a double-bottomed base with a buying point of 65.21. Intel’s shares already burst in the buying zone on Monday, but fell below the buying point. The buying zone reaches 68.47, according to the analysis of the MarketSmith chart.
Intel’s relative strength line, which has been rising in recent months, still remains far from its highs. In addition, the RS Rating of 51 remains well below the minimum of 80 that we would like to see for bursting growth stocks.
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