The Dow Jones Industrial Average rallied 250 points Thursday after initial unemployment claims data from the Labor Department exceeded estimates. And Tesla stock surged as Morgan Stanley reiterated an overweight rating with a reduced price target.
Weekly unemployment figures showed first-time claims rose to 225,000 vs. 216,000 in the previous week, higher than Econoday estimates for a rise to 222,000. Claims have been up and down in recent weeks, but generally trending lower since a mid-November high of 241,000.
On the earnings front, chicken egg distribution giant Cal-Maine Foods (CALM) reported Wednesday after the close. Shares declined more than 4% in morning trade. CALM stock ended Wednesday below a 62.74 buy point after two days of losses.
Electric-vehicle leader Tesla (TSLA) raced almost 7% higher Thursday as Morgan Stanley affirmed its overweight rating on the stock, despite a price target cut. Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) traded higher after today’s stock market open.
Cardinal Health (CAH), Medpace (MEDP), IBD Leaderboard stock Neurocrine Biosciences (NBIX) and Texas Roadhouse (TXRH) — as well as Dow Jones names Amgen (AMGN), Caterpillar (CAT) and Chevron (CVX) — are among the top stocks to consider for investor watchlists. Keep in mind the recent market weakness should keep investors on the sidelines.
Dow Jones Today: Oil Prices, Treasury Yields
After Thursday’s opening bell, the Dow Jones Industrial Average moved up 0.75%, and the S&P 500 gained 1.1%. The tech-heavy Nasdaq composite rallied 1.6% in morning action.
The 10-year Treasury yield ticked lower to 3.86% Thursday morning, with the yield moving further above its 50-day line after three days of gains.
Meanwhile, U.S. oil prices traded almost 2% lower Thursday, as West Texas Intermediate futures back away from resistance just above $79 a barrel, following a two-week advance. The Energy Information Administration will provide weekly information on oil inventories at 11 a.m. ET.
Stock Market Correction
On Wednesday, the Dow Jones Industrial Average sold off 1.1%, while the S&P 500 dropped 1.2%. The tech-heavy Nasdaq composite was hardest hit, declining 1.35%.
Wednesday’s The Big Picture column commented, “Perhaps more importantly, amid generally quiet trading expected for the remainder of the year, price matters more lately. And the size of the price declines continued to stay weighty. Moreover, the loss of most gains by key equity indexes since an Oct. 21 follow-through day means that it’s still very hard to make money going long.”
Dow Jones Stocks To Watch: Amgen, Caterpillar, Chevron
Drugmaker Amgen continues to trace a flat base amid a three-week losing streak. And shares are further below their 50-day line after more losses Wednesday. For now, the correct buy point is 296.77, but the stock needs to decisively retake its 50-day first. AMGN stock is up more than 16% for the year through Wednesday. Shares traded 0.5% higher Thursday.
Dow Jones member Caterpillar finished below a 239.95 buy point in a flat base Wednesday, according to IBD MarketSmith pattern recognition. If the stock retakes the entry, the buy zone goes up to 251.95. Bullishly, the stock’s relative strength line, a key technical indicator, is at new highs. CAT stock has a year-to-date gain of almost 16%. Shares moved up 0.5% Thursday.
Energy giant Chevron is testing its 50-day line amid Wednesday’s 1.5% drop, as the stock continues to trace the right side of a flat base that has a 189.78 buy point. CVX stock is the Dow’s year-to-date leader, up more than 50%. Shares were slightly lower Thursday morning, amid the weakness in oil prices.
Top Stocks To Watch: Cardinal Health, Medpace, Texas Roadhouse
Cardinal Health, a recent IBD Stock Of The Day, is holding close to a 81.67 buy point in a flat base. Shares declined 0.7% Wednesday. CAH stock was up 0.3% Thursday.
Medpace bounced sharply from its 50-day line last week, with a gain of 3.3%. But the stock gave up a big part of those gains during Tuesday’s 2% fall and is once again trying to find support. For now, the correct buy point looms at 235.82, but an earlier entry at 220.09 is also in play. MEDP stock was up 1.5% Thursday.
Texas Roadhouse shows a new buy point at 101.85 in a flat base, but is now consolidating below its 50-day line. The restaurant leader will look to recover that key benchmark over the coming sessions, but two straight days of sharp losses isn’t constructive. TXRH stock traded up 0.1% Thursday morning.
IBD Leaderboard stock Neurocrine slipped 0.2% Wednesday, again testing support around its 50-day level. A recent bounce off that 50-day line was bullish for the stock’s prospects, but now shares are back at that key area. NBIX stock was up 0.3% Thursday.
Stocks To Watch
These are six top stocks to watch in today’s stock market, including three Dow Jones leaders.
|Company Name||Symbol||Correct Buy Point||Type Of Base|
|Cardinal Health||(CAH)||81.67||Flat base|
|Texas Roadhouse||(TXRH)||101.85||Flat base|
Source: IBD Data As Of Dec. 28, 2022
Tesla stock snapped a seven-day losing streak Wednesday, reversing higher and rallying 3.3% after hitting a 52-week low at 108.76. Shares closed about 72% off their 52-week high.
Shares looked to continue their rebound Thursday morning, racing nearly 7% higher.
Late Wednesday, Morgan Stanley analyst Adam Jonas lowered the firm’s price target from 330 to 250, while keeping an overweight rating on TSLA stock. He believes 2023 is “shaping up to be a ‘reset’ year for the EV market,” and Tesla is in position to extend its lead over the competition.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares sold off 3.1% Wednesday, dropping to 125.87, their lowest level since June 2021. The stock is around 32% off its 52-week high and down 29% since the start of the year. Shares rallied 1.7% Thursday morning, as the Wall Street Journal reported that iPhone production in China was ramping up after Covid-19 issues.
Microsoft stock dropped 1% Wednesday, falling further below the 50-day line. The software giant is about 32% off its 52-week high with a year-to-date loss of more than 30%. MSFT stock moved up 0.8% early Thursday.
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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