Stocks crept into a mixed open Friday as Disney stock, rallying after its fiscal third-quarter report, helped prop the S&P 500 and the Dow Jones today. BioNTech and Moderna climbed, after the FDA broadened approval for their Covid vaccines. China stocks were weak, and chipmakers mixed. Meanwhile, IBD 50 stock Upstart Holdings surged on an analyst upgrade.
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The Dow industrials wrestled 0.15% higher, taking out another new high and moving to add to an already strong week. The S&P 500 defended a gain of less than 0.1%. The Nasdaq Composite fought its way into flat trade, as China-based stocks packed the bottom of the Nasdaq 100 and Apple (AAPL) reversed 0.2% higher after an early dip into the red.
IBD 50 stock Moderna (MRNA) popped 1.8% after the Food and Drug Administration approved the Pfizer (PFE)/BioNTech (BNTX) and Moderna (MRNA) Covid-19 vaccines as a third-application booster shot for patients with weak immune systems. BioNTech gained 3.1%. Pfizer rose 1.5%. All three stocks have been exhibiting signs of climax-run behavior.
Regeneron Pharmacueticals (REGN) caught some updraft from the rallying biotechs, gaining 2.4% and leading the S&P 500 in early trade. Regeneron is nearing the top of a buy range above a 592.94 cup-with-handle base buy point. The buy zone extends to 622.59.
Upstart Holdings (UPST) spiked 8%, leading the IBD 50 list, after Barclays upgraded the stock to overweight. The note also boosted Upstart’s price target to 230, from 130. The gain sent Upstart into a buy range above a 191.99 buy point in a deep 10-week cup base.
Aside from Disney stock, earnings news sent LMP Automotive (LMPX) up 3.8% and ZipRecruiter (ZIP) to a 4.5% gain. On the earnings downside, Cricut (CRCT) tumbled 17%, while Figs (FIGS) took a 6.5% dive. DoorDash (DASH) dropped 4.8% and Airbnb (ABNB) backed off 1%.
Chicken meat producer Pilgrim’s Pride (PPC) rocketed 22% higher after Brazil’s JBS (JBSAY) proposed a buyout of the remaining 20% of the company it does not already own at 26.50 a share. JBS shares shed 0.4%.
Dow Jones Today: Disney Earnings
Walt Disney (DIS) scrambled 4% higher, leading both the S&P 500 and the Dow Jones today, after topping analysts’ fiscal third-quarter sales and earnings expectations. But analysts remained concerned about theme park impact from the recent resurgence of Covid-19 infections. Disney reported strong subscriber growth, with Disney+ rising to 116 million paid subscribers. ESPN+ is at 14.9 million and Hulu has 42.8 million.
Aggressive investors might read a strong bounce above the 50-day/10-week moving average as a buying opportunity. The next most likely early entry for Disney stock comes at 186.39.
Chip Stocks: Nvidia, AMD, Intel
Chip stocks were mixed in a week that turned tough after an analyst’s industry price warning on Tuesday. IBD Leaderboard stock Nvidia (NVDA) added a fraction in early trade. The stock is down 2.3% for the week and testing support at its 21-day exponential moving average. Nvidia shares are less than 5% from a 208.85 flat base buy point, ahead of the company’s second-quarter report on Wednesday.
Advanced Micro Devices (AMD) gained 0.7% in premarket trade. Chipmaker Intel (INTC) dropped 0.7% on the Dow Jones today. The VanEck Vectors Semiconductor ETF (SMH) traded flat early Friday.
Vital Signs: Oil, Bond Yields, Bitcoin
Crude oil prices slipped early Friday, after a modest drop on Thursday ended a two-day rebound. West Texas Intermediate traded down 0.2% to below $69 a barrel. WTI prices remain up around 1% for the week, following the prior week’s 7.7% dive. WTI is trading 10.4% below its July 6 high, and up 42% since the start of the year. Oil prices could see some impact from the BakerHughes weekly rig count survey, due out at 1 p.m. ET.
The 10-year Treasury yield eased early Friday, dipping to 1.33% after settling on Thursday just below 1.37%. A six-day advance through Tuesday marked the longest rally in yields since January and left yields almost 6% higher so far for the week. Yields had touched their high for the year, just above 1.76%, in early April.
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Bitcoin rallied almost 5% to trade around $46,575, after swinging as high as $46,667 and as low as $43,821 over the past 24 hours, according to Coindesk. Bitcoin touched a high above $64,829 in mid-April. Cryptocurrency plays Marathon Digital Holdings (MARA) and MicroStrategy (MSTR) traded up 5.3% and 2.7%, respectively.
China Notches An Up Week, Europe Rises
China’s markets slipped on Friday, but ended higher for the week, adding a second week to their rebound following a sell-off on regulatory fears. Hong Kong’s Hang Seng Index dropped 0.5% Friday, leaving it 0.8% higher for the week. The Shanghai Composite dipped 0.2%. The benchmark ended the week with a 1.7% gain, and back above support at its 10-week moving average. In Japan, Tokyo’s Nikkei 225 shed 0.1%, notching a 0.6% advance for the week.
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Among China gauges in the U.S. early Friday, the iShares MSCI China ETF (MCHI) was unchanged. The Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR) dipped 0.2%. MSCI China was up 1.3% for the week through Thursday. The xTrackers Harvest fund had gained 1%. Technology tracker KraneShares CSI China Internet ETF (KWEB) traded 1.7% lower in early trade, and had gained 1.2% for the week through Thursday.
Europe’s markets defended their early gains in afternoon trade. The CAC-40 in Paris rallied 0.3%. Frankfurt’s DAX also moved up 0.3%. London’s FTSE 100 climbed 0.35%. The SPDR Portfolio Europe ETF (SPEU) advanced 0.5% in early trade, after a fractional gain on Thursday. The ETF is up 1.2% for the week, working on a fourth-straight weekly advance and trading just below a 44.06 buy point in an eight-week flat base.
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Century Communities (CCS) closed on Thursday less than 1% below a 72.60 buy point in a cup-with-handle base. The Colorado-based builder carries a 96 Composite Rating from IBD, ranking it the No. 1 stock in the residential homebuilders industry group. Shares slipped 0.4% Friday morning.
Chipmaker On Semiconductor (ON) spiked 15.9% in the first week of August, breaking out past a 44.69 buy point in a 16-week cup base. The stock has slipped back just below that buy point. The base’s buy range runs to 46.92.
A three-day advance has lifted Arch Capital Group (ACGL) into a buy zone, just above a 41.38 entry in a 15-week flat base. The buy zone tops out at 43.45.
Shipping giant Matson (MATX) is also sitting on a three-day rise, and working to add a third week to its rally. That has placed shares about 6% below a 79.15 buy point at Wednesday’s closing bell.
A 1.2% jump early Friday lifted industrial chemicals supplier Element Solutions (ESI) just below a 24.80 buy point in a very flat base. The base pattern clings bullishly to the chart’s 10-week moving average.
Nasdaq, S&P 500 and Dow Jones Today
August is shaping up to be a solid month, with the Dow so far up 1.6%, the S&P 500 ahead 1.5% and the Nasdaq Composite riding a 1% gain. Those are strong positions to be in as earnings season rolls toward its finish, an important back-to-school shopping season gets started, and as global supply chains and markets gradually mend.
The Dow Jones today heads for the starting bell with a 0.8% gain so far for the week. The index is neither too hot nor too cold and has put resistance at the 35,000 level, at least for now, in the rearview mirror. The S&P 500 has a 0.6% gain for the week through Thursday. The Nasdaq is down 0.1%, but managing to ride firm support at its 21-day exponential moving average.
For more detailed analysis of the current stock market and its status, study the Big Picture.
The SPDR Dow Jones Industrial Average ETF Trust (DIA) remains in a buy range above a double-bottom base entry at 348.75. The buy range extends to 366.19. The leveraged ProShares UltraPro Dow30 (UDOW) remains in a buy range above what IBD MarketSmith analysis charts as a 76.99 buy point in an 11-week flat base. The buy zone tops out at 80.84.
A Mixed Week For Rebounding Small Caps
A three-week rebound among small cap stocks cooled this week, with the Russell 2000 down 0.2% through Thursday after meeting resistance at its 10-week line. The S&P Smallcap 600 has gained 0.2%, on track to extend its rebound to a fourth week. The index on Thursday marked its third-straight daily finish above its 50-day/10-week moving average.
That could mark an early entry to the SPDR S&P 600 Small Cap ETF (SLY), which was up 0.3% for the week through Thursday. The leveraged ProShares Ultra SmallCap600 (SAA) has a 0.7% gain for the week.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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