The Dow Jones Industrial Average fell sharply on Friday morning, extending losses from Thursday’s stock market sell-off. Earnings season heated up with quarterly results from financial giants Citi Group (C), JPMorgan to pursue (JPM) and wells Fargo (WFC).
Among the Dow Jones leaders, Apple (AAPL) fell 0.4% on Friday, while Microsoft (MSFT) fell 0.1%. Also among the Dow 30, financial leaders Goldman Sachs (GS) and JPMorgan Chase (JPM) are close to new buy points in today’s stock market.
electric vehicle leader Tesla (TSLA) traded down 1.5%. EV Truck Rival Rivian (RIVN) fell almost 1%. lucid group (LCID) fell 1%. And Chinese electric vehicle leaders li car (LI) and Xpeng Engines (XPEV) were higher.
Among Friday’s top stocks to buy and watch, Applied Materials (AMA), Mosaic (MOS), financial SVB (SIVB) and Taiwan Semiconductor Manufacturing (TSM) are in or near new buying zones. Keep in mind that the current health of the stock market is not exactly conducive to new purchases.
Microsoft and Tesla are shares of the IBD classification. Applied Materials is an IBD SwingTrader Stock. Commercial Metals and SVB Financial appear in the Stocks column near a buy zone this week.
After the stock market opened on Friday, the Dow Jones Industrial Average was down 0.95%, while the S&P 500 was down 0.6%. And the tech-heavy Nasdaq Composite declined 0.4%. Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.4% in morning trading, and the SPDR S&P 500 ETF (SPY) fell 0.6%.
The 10-year Treasury yield rose, close to 1.74% on Friday morning. On Thursday, the 10-year Treasury yield fell for the third day in a row, closing at 1.71%.
Stock market rally weakens
The stock market posted a disappointing performance on Thursday as the Nasdaq and S&P 500 sold off strongly. The Nasdaq more than erased all previous two days of gains, leaving it close to its 200-day moving average. Meanwhile, the S&P 500 gave up its 50-day support level.
The Big Picture on Thursday commented: “Don’t give up on the market rally completely just yet. The Nasdaq found support at its long-term 200-day line earlier this week. That could still provide a launching pad for a further sustained rally though that is less likely at the moment If the Nasdaq weakens further and pulls out its 200 day line then further declines are likely As usual don’t predict the direction of the market be flexible and let the market decide your best course of action.”
For more daily stock market commentary, check out IBD’s The Big Picture.
Five best Dow Jones stocks to watch right now
Stocks on the move: Ford, NetApp
Stock market leader Ford (F) fell 2.5% on Friday after RBC Capital Markets downgraded the stock from outperformer to sector performer. Shares closed Thursday more than 50% above a buy point of 16.56 on a cup basis.
netapp (NTAP) rose nearly 1% on Friday morning after Cowen upgraded the stock from market performance to outperformance. Stocks are range buying beyond a buy point of 94.79 on a flat basis.
Stock earnings: Citigroup, JPMorgan, Wells Fargo
Before the open on Friday, financial giants Citigroup, JPMorgan Chase and Wells Fargo reported their quarterly results.
Citigroup fell about 3% on Friday, just after it released fourth-quarter earnings results. Stocks are back above their 50-day line, but still below their 200-day line, despite a six-day advance. The shares closed Thursday down 15% from their 52-week high.
Dow Jones JPMorgan shares reported solid earnings and sales numbers, but the stock was down more than 6% on Friday morning. The stock is building a flat base with an entry of 173.06.
Wells Fargo reported strong earnings and sales results, leading to a 2% increase in morning trading. The stock extends past a buy point of 52.67 on a flat basis following a breakout on Jan 4.
Dow Jones Stocks to Buy and Watch: Goldman Sachs
Shares of Dow Jones, Goldman Sachs, rose 0.1% on Thursday, ignoring market weakness, but remain below the 50-day line. The stock continues to trace a cup-and-handle basis with a buy point of 412.76, according to graphical analysis from IBD MarketSmith. Shares fell 3.2% on Friday. The company reports December quarter results on Tuesday.
Top 3 Growth Stocks to Watch in the Current Stock Market Rally
Stocks to buy and watch: Applied Materials, Trade Metals, Diamondback, SVB Financial
Shares of IBD SwingTrader, Applied Materials, missed out on Wednesday’s bullish action, falling back below its flat-based buy point of 159.10, according to IBD MarketSmith chart analysis, during Thursday’s 1.5% loss. On the positive side, the stock’s relative strength line is just shy of the new highs. AMAT shares rose 0.5% on Friday.
Mosaic gave back some of Wednesday’s breakout move, falling 0.7% on Thursday. Shares closed in a buying range above a cup with a 41.25 entry on the handle. MOS shares have a perfect 99 IBD composite rating, based on the IBD Equity Review. Shares rose 3% on Friday after BMO Capital upgraded the stock from market performance to outperformance.
SVB Financial is drawing a cup base with a buy point of 763.32. Look for a potential identifier to offer a more optimal point of purchase for the risk. Shares fell 3.5% on Thursday, ending right at the 50-day line. Shares fell more than 2% on Friday. The Santa Clara, California-based bank reports fourth-quarter results on Thursday.
Taiwan Semiconductor topped a buy point of 135.60 on a mug with a handle, jumping more than 5% on Thursday after the company beat analysts’ estimates for the fourth quarter. The 5% buy area reaches a high of 142.38. TSM shares fell 1.5% on Friday.
Join IBD experts as they discuss the top stocks in the current stock market rally on IBD Live
Electric Vehicle Stocks: Li Auto, Xpeng, Lucid Motors, Rivian
Li Auto shares rose for the third straight session on Thursday, gaining 0.1%. The stock is rising on the right side of a consolidation with an entry of 37.55, while an early entry of 33.86 is also on the cards. Shares rose 0.15% on Friday.
Xpeng Motors fell 1.8% on Thursday but still held above the 50-day line. The shares formed a cup with a handle, but that formation no longer exists. The stock continues to build a consolidation with an entry at 56.55. Aggressive investors could use 51.60 as an early entry. Stocks rose on Friday.
Among US-based electric vehicle stocks, shares of Lucid Motors fell about 1% on Friday. Shares of LCID remain spread beyond a buy point of 28.49 on a cup-and-handle basis. Meanwhile, the stock’s bottoming process had some trouble after Thursday’s 8.85% drop.
EV truck maker and recent IPO Rivian were down around 1% on Friday, on pace to add to Thursday’s 7.1% drop. RIVN shares closed Thursday down 55% from their post-IPO highs
Shares of Tesla traded down 1.5% on Friday, threatening to add to Thursday’s nearly 7% drop. Stocks again gave back their 50-day moving average on Thursday. Last week, the EV leader gave up its critical 50-day moving average line and triggered the 7% to 8% stop-loss sell rule from a trendline buy point of 1,119, 10 before staging a three-day rebound.
The shares traded as high as 1,243.49 on Nov. 4, but the stock ended Thursday down 17% from a 52-week high.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares fell 1.9% on Thursday, snapping a four-day winning streak. The shares are 12% beyond a buy point of 153.27 on a cup-and-handle basis, according to graphical analysis from IBD MarketSmith. Shares fell 0.4% on Friday.
Software leader Microsoft slipped 4.2% on Thursday, hitting a new recent low. Major Dow stocks continue to record a flat bottom with a buy point of 349.77, but stocks clearly have more work to do before a potential breakout. Shares fell 0.1% on Friday.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.
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