The Dow Jones Industrial Average closed lower even as the Nasdaq flew more than 3%. Meta platforms (META) skyrocketed when Mark Zuckerberg shared a surprise. Apple (AAPL) skyrocketed during open trading, but bounced back hours after a missed profit, while Microsoft (MSFT) was a top blue chip.
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New Leaderboard Member US Global Jets (JETS) ETF climbed above a buy point. A trio of other notable names staged breakouts amid the bullish action. Tough (CHWY), Tapestry (TPR) and Arrow electronics (ARW) all tested entries.
New data from the Labor Department showed that first-time jobless claims fell to 183,000 from 186,000 in the previous week. Analysts had expected an increase to 193,000. The labor market remains strong, with initial applications last week coming in much lower than expected for the second week in a row.
Nasdaq jumps, small caps shine
Today’s action was crucial as the stock market often has a second reaction to Fed meetings. With Fed Chairman Jerome Powell’s virtuoso post-meeting performance boosting markets yesterday, traders appeared to remain in risk-on mode today.
The Nasdaq was the strongest of the major indices, up 3.3%. DocuSign (DOCU) performed well here with a gain of 7.7%.
The S&P 500 rose 1.5% to its best level in five months. W. W. Grainger (GWW) was one of the stars here, as it gained 13% on the company’s quarterly results.
Sectors of the S&P 500 closed mixed. Consumer discretionary, communications services and technology performed best, while consumer staples and energy were the biggest laggards.
Small caps also impressed, with the Russell 2000 up 2.1%. Growth stocks fought back to close, with the Innovator IBD 50 ETF (FFTY) gaining 1%.
Dow Jones Today: Microsoft Stock Pops, Apple Earnings Miss
The Dow Jones Industrial Average underperformed the other major indices, despite some components performing well. It closed lows, but was still down 0.1%.
Microsoft stock was the best performer on the Dow Jones today, rising 4.7%. MSFT stock is now free from its 200-day moving average for the first time since April, MarketSmith shows.
Apple shares also performed well, rising 3.7%. AAPL stock has also hit the 200-day line and is up more than 20% so far this year.
Apple’s earnings, however, caused the stock to plummet more than 3% after hours. Earnings per share fell 10.9% to $1.88, while revenue fell 5.5% to $117.15 billion. Wall Street had expected earnings per share to fall 8.1% to $1.93 and revenue to fall 2.2% to $121.21 billion, according to Zacks Investment Research.
iPhone and Mac revenues were both lower than analysts had expected, although iPad sales exceeded views.
On the other hand, UnitedHealth (UNH) and Merck (MRK) both lagged the Dow. UNH plunged 5.3% while MRK fell 3.3%.
Meta Supply Missiles; Mark Zuckerberg admits ‘surprise’
Facebook parent Meta Platforms skyrocketed after its latest quarterly report on Wednesday. While revenue lagged, revenue, sales guidance, and number of Facebook users outpaced views.
Meta stock closed slightly off the day’s highs on Friday, but was still up 23.3%. This allowed it to destroy its 200-day moving average. There is currently no entry point in sight.
Investors seemed particularly pleased that the company announced a $40 billion share buyback. The parent company of Facebook and Instagram lowered its forecast for spending, including capital expenditures.
CEO Mark Zuckerberg appears to be finding his inner Ebenezer Scrooge, boasting on the earnings call that “reducing layers of management” had improved information flow, which he says will lead to better products and better employee retention.
“That was honestly a little surprising to me, that as we got into this, the company made me feel better,” he said.
Zuckerberg already sees a big advantage. The tech mogul, who was worth $57.2 billion on Wednesday according to Bloomberg, will see his net worth rise significantly at the end of today’s trading.
New leader rises past buying point
The US Global Jets ETF soared from a buying point amid bullish action in the airline space.
It managed to get away from a 20.79 point entry to earn a spot on the prestigious IBD Leaderboard list. The ETF climbed 3.1% and rose to the top of its buy zone.
The ETF has the bulk of its holdings in both US and overseas airlines, but airline and travel companies also hold significant holdings within the fund.
Wednesday’s IBD stock of the day, Delta Airlines (DAL), closed above a buy point of 39.72, with the 5% buy zone extending to 41.70. It ended the day flat.
Among related stocks, Southwest airlines (LUV) increased by 3.4%, United Airlines (UAL) gained 4.2%, US airlines (AAL) popped 2.2% and Alaska air (ALK) jumped 3.3%.
Align technology Stock sinks its teeth into monster profits
Orthodontics stock Align technology (ALGN) was one of the best performing stocks in the stock market today.
It rose 27.3% in its quarterly report after beating Wall Street views on the top and bottom lines.
Investors also supported Align stock after the company announced it will buy back up to $1 billion of its shares over the next three years.
There is no entry in sight after the stock exploded and rose more than 60% above its 50-day moving average.
ALGN shares are up nearly 70% so far in 2023.
Beyond Dow Jones: 3 Stock Test Entries
Now is a good time to buy quality stocks, and a trio of notable names tested buy points on Thursday.
Online pet-goods retailer Chewy is in a buying zone after clearing a cup-with-handle item from 48.11. The relative strength line has just reached a six-month high, a bullish sign.
Arrow Electronics jumped past a cup base of 129.66 after the earnings report. It has a top-notch EPS rating of 95.
One reason to be cautious is that the forecasts are not that impressive. Earnings per share fall 29% in 2023 and then rise 1% in 2024.
Tapestry is just below the entrance after previously clearing a cup buy point of 47.15. This is a foundation in the first phase, which means it is more likely to land rich profits.
Earnings are a major weakness, with an EPS rating of 52 out of 99. Earnings are up 5% this year and then up 15% in 2024.
Follow Michael Larkin on Twitter at @IBD_MLarkin for more analysis of growth stocks.
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