The Dow Jones Industrial Average dropped 200 points Wednesday, as the 10-year Treasury yield continued its recent climb. Retailers Gap and Nordstrom plummeted on disappointing third-quarter results. And Tesla stock skidded in morning trade.
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Among the Dow Jones leaders, Apple (AAPL) traded down 0.3% in Wednesday’s morning action, while Microsoft (MSFT) moved down 0.9% in today’s stock market. Nike (NKE) is back below a recent buy point after another breakout attempt.
Electric-vehicle leader Tesla (TSLA) lost 3% Wednesday. EV peer Rivian (RIVN) fell over 4%, while Lucid Motors (LCID) was down nearly 3%. Chinese EV leaders Li Auto (LI) and Xpeng Motors (XPEV) are near buy points.
Among the top stocks to buy and watch, Amazon (AMZN), Nucor (NUE) and Pioneer Natural Resources (PXD) are in or near new buy zones.
Microsoft, Nucor and Tesla are IBD Leaderboard stocks. Amazon was featured in this week’s Stocks Near A Buy Zone story. Apple is an IBD SwingTrader stock. Pioneer was Tuesday’s IBD Stock Of The Day.
Dow Jones Today: Fed Minutes, Jobless Claims
After the stock market open Wednesday, the Dow Jones Industrial Average dropped 0.5%, while S&P 500 moved down 0.6%. The tech-heavy Nasdaq composite slid 1.1% in morning trade.
Among exchange traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.8%. The SPDR S&P 500 ETF (SPY) dropped 0.5% Wednesday.
On Tuesday, the 10-year Treasury yield added to Monday’s sharp rise, closing above 1.66% for the first time since Oct. 21. The yield rose again early Wednesday, trading near 1.69%.
Markets will close on Thursday for the Thanksgiving Day holiday, and will run a short session on Friday, closing at 1 p.m. ET. The schedule change has the market positioning for a heavy day of economic reports on Wednesday, including third-quarter GDP, October durable goods orders, new home sales, and consumer spending and sentiment.
The Labor Department said weekly jobless claims fell to 199,000 — their lowest level since 1969 — handily topping Econoday estimates that expected initial unemployment claims to fall to 264,000 from last week’s 268,000.
In addition, minutes from the Federal Reserve’s November meeting are due out at 2 p.m. ET. The minutes should provide insight into the central bank’s plans for interest rates and tapering. Investors increasingly expect the Fed to tighten monetary policy in the near future.
Stock Market ETF Strategy And How To Invest
Stock Market Rally
The stock market put in another mixed performance Tuesday, as the Nasdaq fell with moderate losses. The Dow Jones Industrial Average and S&P 500 logged modest gains.
On Tuesday, The Big Picture commented, “One need only look at the damage seen in enterprise software firms including Asana (ASAN) — a longtime stalwart member of the IBD 50 — CrowdStrike (CRWD), Atlassian (TEAM), Monday.com (MNDY) and Palantir Technologies (PLTR) lately to understand how quickly top growth stocks can surrender gains. All five stocks have crossed below their key 50-day moving averages, a sign of sudden weakness and a potential sign of a serious change in character.”
For daily stock market commentary, be sure to check out IBD’s The Big Picture.
Five Best Dow Jones Stocks To Watch Now
Dow Jones Stocks To Buy And Watch: Apple, Nike
IBD SwingTrader stock Apple is barely extended past a 153.27 buy point out of a cup with handle, according to IBD MarketSmith chart analysis, following eight straight up days. The 5% buy zone tops out at 160.93. Shares lost 0.3% Wednesday morning.
Dow Jones retail leader Nike bullishly regained its cup base’s 174.48 buy point amid Friday’s 2.1% rally. But shares gave up that buy point on Monday and fell further below the entry during Tuesday’s 2% decline. NKE shares fell over 2% Wednesday.
Nike canceled orders to at least one retail store until summer 2022 due to supply chain issues.
Stock Market Earnings: Autodesk, Deere, Gap, Nordstrom
Autodesk (ADSK) plunged 12% Wednesday morning after the company’s current-quarter outlook fell short of estimates. ADSK shares are set to open sharply below their 50- and 200-day moving averages.
Deere (DE) rallied nearly 3% after the company beat the Street’s earnings and sales targets early Wednesday. Shares are tracing a new base with a 393.10 buy point.
Retailer Gap (GPS) crumbled 21% Wednesday after the company reported weak third-quarter results and cut its full-year guidance due to significant supply-chain constraints. Gap shares closed Tuesday about 38% off their 52-week high.
Nordstrom (JWN) sold off 21% Wednesday morning after the retailer missed third-quarter sales estimates.
Stocks To Buy And Watch: Amazon, Nucor, Pioneer
Amazon remains below its 3,605.55 buy point in a cup with handle, according to IBD MarketSmith chart analysis, following Tuesday’s 0.2% rise. AMZN shares dropped 0.5% Wednesday.
The stock’s relative strength line is coming sharply off recent lows after November’s gains, but it is well below its July high. That indicates underperformance vs. the S&P 500 over a longer time frame. Ideally, the RS line should hit a new high on the breakout day or shortly thereafter to confirm the stock as a market leader.
IBD Leaderboard stock Nucor is trying to break out past a 119.42 buy point out of a cup with handle on the heels of Monday’s 6% advance. Leaderboard noted that the price action warranted a boost from a quarter-size position to a half. The steelmaker was up 0.5% Wednesday.
Tuesday’s IBD Stock OF The Day, Pioneer Natural Resources, is rapidly approaching a flat base’s 196.74 buy point. The stock flashed an early entry, as it rebounded from its key 50-day line. Shares traded up 0.4% after Wednesday’s open.
Join IBD experts as they analyze leading stocks in the current stock market uptrend on IBD Live
EV Stocks: Li Auto, Xpeng, Lucid Motors, Rivian
Li Auto continues to build a cup-with-handle base that shows a 34.93 buy point, as shares rose nearly 2% Tuesday. The stock rose 2.6% Wednesday.
Xpeng Motors is extended past its 48.08 buy point in a choppy cup base following Tuesday’s earnings-fueled 8.25% rally. XPEV shares rallied another 1.7% Wednesday.
Lucid Motors shares dropped nearly 3% Wednesday, giving back a part of Tuesday’s 2.6% rally. LCID stock remains far extended past a 28.49 buy point in a cup-with-handle base.
Hot initial public offering Rivian lost over 4% Wednesday following Tuesday’s 1.5% gain.
RIVN shares closed Tuesday about 33% off their post-IPO highs. The decline is a potential positive for investors remaining disciplined and waiting for an IPO base to form before considering a purchase. The recent weakness could be the start of Rivian’s first base formation, but last week’s price action was not constructive given the huge downside reversal and high volatility.
Tesla Stock
Tesla stock dropped over 3% Wednesday, threatening to add to Tuesday’s 4.1% sell-off.
Shares traded as high as 1,243.49 on Nov. 4, but the stock ended Tuesday about 11% off its 52-week high. TSLA shares remain sharply above a 764.55 buy point in a cup with handle, as well as earlier entries at 700.10 and 730. The chart also showed an alternate entry at 900.50.
Dow Jones Leaders: Microsoft
Among the top Dow Jones stocks, software giant Microsoft moved down 0.9% Wednesday, threatening to extend a losing streak to three sessions.
On Oct. 18, Microsoft stock broke out past a flat base’s 305.94 buy point. The 5% buy zone topped out at 321.24, so the stock is extended.
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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