Shares pushed into early trading Wednesday as the market kept an eye on events in Washignton, DC, where the U.S. House of Representatives launched a historic second round of prosecution against President Donald Trump. Homebuilder gathered after a strong Q4 report from KBHome. Electric car maker Canoo spearheaded reports of talks with Apple. Intel spearheaded a change in leadership and led the Dow Jones today.
The Dow Jones Industrial Average reversed its opening gain, up 0.1% Intel‘s (INT) C 12% gain. Intel CEO Bob Swan announced he would step down in February VMWare (VMW) Chief Pat Gelsinger sat down to take over the position. VMware shares fell 5.9%.
The S&P 500 and Nasdaq switched between narrow gains and losses in the stock market today. Small capsules ran slightly behind the market with iShares Russell 2000 ETF (IWM) down 0.1%, however Matrix services (MTRX) and Golar LNG (GLNG) increased large early gains.
Growth stocks and capsules rose again Tuesday amid an unstable session that ended with modest gains. The Innovator IBD 50 ETF (FFTY) growth stock tracker sailed 2.2% higher, rising for the fourth time in a row to a gain of 7.8% so far in January. On the small cap side, the iShares Russell 2000 ETF bumped up 1.8% on Tuesday, heading for its 10th gain in the last 11 weeks, and also lifted its so far in January to 7.8%.
Intel led the S&P 500, followed closely by a package of house-building stocks. Entrepreneur KB Home (KBH) jumped 4.7% in pre-market trading after reporting big sales and earnings in the fourth quarter hit late on Tuesday with a 54% increase in backlog of ordered homes. Wednesday’s move suggests stocks are opening back above their 10-week moving average, a level of support that the stock has been trying to take back since October.
General Motors (GM) and Regeneron Pharmaceuticals (RAIN) were also early leaders, climbing more than 2% each. GM launched its BrightDrop delivery service for electric cars on Tuesday. GM shares are expanding after Tuesday’s breakout past a buy point of 46.81.
Shares to look at: CrowdStrike, Maravai, Yatsen, tractor supply
Shares to watch Wednesday include security software developer CrowdStrike Holdings (CRWD), which joined IBD’s Big Cap 20 list on Tuesday. The stock is in a buying zone as it clears a brief consolidation and test of support. Maravai LifeSciences Holdings (MRVI) trades below a buy point of 31.29 in a bowl-with-handle base formed immediately after the company’s November 20 first listing. Maravai is on the IBD Leaderboard watch list.
Shares near buyout points early Wednesday included an initial listing, Yatsen Holding (YSG), better off Tractor supply (TSCO).
China-based Yatsen was a brand new number in November and immediately slipped into a consolidation that has become an eight-week cupbase with a buying point of 21.10. Shares closed 10% below this post on Tuesday. The stock advanced 0.8% in early trading on Wednesday.
The retail chain Tractor Supply was in a buy range at the end of Tuesday above a buy-with-handle buy point of 150.79. The buying zone extends to 158.33.
Dow Jones today: Intel raises when the swan steps down
Chip giant Intel easily led the Dow Jones today, pairing its initial rise to 9% following the news that CEO Bob Swan would step down in February. The Swan had taken over the post two years ago, just as stocks were knocked down by competitive facts as well as the American trade war with China. Intel shares closed December approx. 6% above where they were when the Swan took the helm.
The future CEO, Gelsinger, has led enterprise software manager VMware since 2012. Gelsinger predicted a 172% increase in VMware shares through April 2019. The stock has since fallen 33% from this high.
IBD 50 shares: Smith & Wesson, Taiwan Semiconductor
Smith & Wesson Brands (SWBI) topped IBD 50 list, up 2% early after an unstable week. The arms manufacturer broke above a buying point of 22.50 when violence unfolded in Washington, DC on January 6th. Shares slammed back quickly, triggering the automatic sell rule. The share closed on Tuesday approx. 9% below this point of purchase.
Taiwan semiconductor (TSM) has been a more reliable player, rising 1.1% on Wednesday as it aims for its 11th straight weekly advance. The stock, also an IBD Leaderboard listing, has gained approx. 14% since clearing a three-week close buy point of 107.94.
Oil, gold, dollar rise; Bitcoin Bobs
The vital signs of the market were stable as data from the Labor Department showed that consumer prices rose in line with expectations, a 0.4% month-on-month increase in December.
West Texas intermediate oil prices rose 0.3% and traded well above $ 53 per barrel. Barrel. WTI has gained 12% over the last six sessions and collected 49% since the beginning of November. The Energy Information Administration publishes its weekly Petroleum Status Report at 10.30 ET.
Gold added 0.5% to $ 1,851.50 an ounce. Copper rose 0.2% up to $ 3.61 a pound. Bonds are traded relatively flat, with the 10-year yield easing 1 basis point to 1.12%. The dollar rose against both the euro and the yen.
Bitcoin bubbled between $ 34,000 and $ 35,000 early Wednesday and was withdrawn from its Jan. 8 high above $ 41,500, according to CoinDesk. The cryptocurrency has risen almost 78% since the beginning of December.
Among bitcoin-related stocks Marathon Patent Group (MARA) fell more than 16% after announcing a 12.5 million. Share offer for 20 pr. Share – 23% below Tuesday’s closing price. MicroStrategy (MSFT) withdrew 2.5%. IBD Leaderboard stock PayPal Holdings (PYPL) traded 0.3% lower in early action. The PayPal share is extended by a 10% increase after clearing a buy base on a cup base of 215.93 in December.
Case against accusation
The House of Representatives will move forward with an indictment against President Trump, beginning at 6 p.m. 9 ET this morning. Trump is accused of calling his supporters to Washington on January 6 and inciting them to revolt in an attempt to thwart congressional confirmation of voting votes, appointing Joe Biden as the new US president.
The House passed a resolution in the 235 to 205 vote late on Tuesday, recommending Vice President Mike Pence to exercise the 25th Amendment powers to remove Trump from office immediately. Illinois Representative Adam Kinzinger was the only Republican to support the measure.
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Pence returned a letter to House Speaker Nancy Pelosi late on Tuesday, saying he refused to take such a step and that he felt it was not “in the interest of our nations or in accordance with our Constitution.”
Pelosi on Tuesday appointed nine prosecutors, all Democrats and all lawyers. An expectations poll is expected on Wednesday. A house vote for indictment will send the case to the Senate, which has the power to convict the president. The Senate is not expected to come together completely again on January 19, which means the matter may not be resolved before Trump leaves office.
A conviction from the Senate would deprive Trump of the privilege of having any future office. It also eliminates all the president’s pensions, travel allowances and protection of secret services.
Transition of power
The FBI has reported further, credible threats of violence in Washington, beginning on January 16, before the inauguration of Biden on January 20. Trump on Tuesday declared a state of emergency in the country’s capital through January 24. Washington Mayor Muriel Bowser declared a state of emergency on January 6. On Tuesday, she extended the closure of indoor dining through Jan. 22 – in part to discourage visitors and to eliminate venues in the city.
The Pentagon has convened 10,000 National Guard troops with permission for another 5,000. It began deploying troops in the city on Tuesday. The New York Times and Politico confirmed that troops stationed in the city were armed with deadly weapons.
A collective statement from all the Joint Chiefs of Staff said on Tuesday that the armed forces remained committed to “defending the Constitution of the United States against all enemies, foreign and domestic.”
The Joint Chiefs statement declared “the violent riots” on January 6 “were a direct attack on the US Congress, the Capitol Building and our constitutional process.” It stressed that “on January 20, 2021, in accordance with the Constitution, ratified by the States and Courts and certified by Congress, President-elect Joe Biden will be inaugurated and become our 46th Commander-in-Chief.”
Coronavirus vaccines / treatments: Regeneron, AstraZeneca Rise
The number of coronavirus vaccine doses distributed in the United States to Tuesday rose to 27.696 million, according to the Centers for Disease Control. About 9.327 million people have received vaccinations. About 33.6% of the distributed doses have been administered so far.
Federal Pharmacy Partnership for Long-Term Care Program run with CVS health (CVS) and Walgreens Boots Alliance (WBA), has distributed 4.385 million doses. More than 951,000 of these doses have been administered, approx. 21.7%.
Regeneron Pharmaceuticals (RAIN) swung 3.5% higher after confirming a $ 2.625 billion contract with the Department of Defense and the U.S. Department of Health and Human Services for 1.25 million doses of its Casirivimab and Imdevimab Covid-19 antibody cocktail. The agreement raises the total number of doses of treatment ordered by government agencies to 1.5 million.
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The Regeneron stock, which was added to the IBD 50 list on Tuesday, is trying to regain support for its 10-week moving average and stem a retreat that began in July. Benchmark upgraded Regeneron to buy from teams, giving it a 590 price target.
Among preventive vaccine manufacturers, Modern (MRNA) fell 2.6% early Wednesday after Tuesday’s 6.2% rise, resuming support above its 21-day exponential moving average. Pfizer (PFE) vaccine partner BioNTech (BNTX) dipped 2.3% while Pfizer faded 0.4%. Switzerland AstraZeneca (AZN) rose 1.2% after the European Medicines Agency said late Tuesday that the company’s COVID-19 vaccine could be approved for use in EU countries by 29 January.
EV Maker Canoo hovers on Apple Chatter
In news about electric cars other than General Motors, Canoo (GOEV) peaked at 17% after The Verge reported it Apple (AAPL) held talks with the Torrance, California-based company in early 2020. The companies discussed a range of partnership options, from investment to acquisition. Apple has reportedly quietly advanced its own EV technology. Canoo shares are volatile, up 23% on Tuesday after resuming a buyout of 13.60 in a 10-week cupbase.
Among other EV manufacturers, kingpin Tesla (TSLA) traded 0.2% lower early Wednesday. China Li Auto (LI) decreased 2.2% and Xpeng (XPEV) fell 2% while Nio (NIO) rose 0.2%.
Dow Jones today: Home Depot gets an upgrade
Home depot (HD) climbed 0.9% to the top of the Dow Jones today after Guggenheim upgraded the stock to buy, from hold. The note placed a price target of 310, 12% above Tuesday’s closing price, pointing to the recent acquisition of HD Supply and a $ 3 billion debt offer. The note also said that the two-month break in the share advance had allowed for a catch-up in the valuation.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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