Shares defended tight gains early on Friday as the Nasdaq struggled to stay above the 14,000 mark. Commodity inventories are advanced, with ArcelorMittal, Freeport McMoRan and Cleveland Cliffs generating solid profits. Caterpillar returned to the Dow Jones today after a steep fall Thursday.
The Dow Industrial jumped 120 points at the start clock and then paired gains to less than 0.1%. The S&P 500 added 0.1% and held just below Thursday’s record highs. Nasdaq Composite added 0.2% despite biotechnology Vertex Pharmaceuticals (VRTX) and Incyte (INCY) took part in advance actions on the stock market today.
At the top of the Nasdaq 100, DocuSign (DOCU) totaled 2.5% and extended its breakout from a double-bottom base.
Biogen (BIIB) jumped 1.8%. Bernstein upgraded the stock to outperform a 500-price target. Data storage manager Western Digital (WDC) rose 2.8% higher as Susquehanna raised its stock price target to 155 from 125 and kept its rating positive.
Vertex Pharmaceuticals dived more than 8% as two analysts lowered price targets after the company announced disappointing results from a Phase 2 clinical trial. Incyte fell 3.9% after the Food and Drug Administration extended the assessment period for a dermatitis treatment.
Ore worker Freeport McMoRan (FCX) rose 4.1% in an early action, leading the S&P 500. The gain placed the stock in a buy range on a rebound from the 10-week moving average.
Luxembourg-based Ternium (TX) led rising steelmakers and totaled 5.2%. IBD 50 stock Cleveland Cliffs (CLF) added 4.8%, leading the shares by 18.7% so far this week.
Dow Jones Today: Can CAT Rebound?
Chemical producer Dow (DOW) led the early gains on the Dow Jones today with an advance of 0.8%. Larva (CAT) put its gain up to 0.1% and sucked to come back after taking a 3.8% dip on Thursday.
That left Caterpillar shares down 7.5% for the week to Thursday and on track for their worst weekly performance in 12 months. The loss sent the stock back below its 50-day moving average in heavy trading and erased gains from an early May breakout. Both are sales signals.
Despite the loss, the CAT stock still has the sixth largest gain among Dow Jones stocks so far this year with a 24% advance until Thursday.
Formarked: Global-E, AMC, Dave & Buster’s Rising
Israel-based new issue Global-E Online (GLBE) totaled more than 8% after ending Thursday with a gain of 8.4% so far for the week. The stock rose 74% from the initial offer price on May 12, but has not yet formed an IPO.
Earnings news sent restaurant and arcade chain Dave & Busters entertainment (PLAY) to a gain of 5.2%. Two analysts raised their price target on the stock.
Meme shares cooled their early action with GameStop (GME) narrowing to 2.4% gain, and AMC Entertainment (AMC) reverses lower. Workhorse group (WKHS) rose 2.9%. A possible new item on the list, Customers Bancorp (CUBI), set for a 1.6% advance in early action.
Apollo Medical (AMEH) jumped 13% after Standard & Poor’s announced late Thursday that the Russell 2000 edition would also participate in the S&P Smallcap 600 index. Apollo shares have risen 120% since 31 December.
IBD 50 / Leaderboard: Arcelor, Freedom Holding
IBD 50 stock Celsius Holdings (CELH) rose again by 1.3% after its 15% nosedive on Thursday. Credit Suisse upgraded the stock to outperform a price target of 78, up from 57.
Among Leaderboard shares is a steel producer ArcelorMittal (MT) crossed 2.4% and ServiceNu (NOW) received an advance of 1.1%. Arcelor remains in a buy range after a rebound from its 10-week moving average. The buying zone extends to 33.65.
IBD 50 stock Kazakhstan-based Freedom Holding (FRHC) vaulted 4.4% in pre-market trade. It put the brokerage firm and financial services provider in a buying zone above a buying point of 58.20 in a 17-week double-bottom base.
Bitcoin has over $ 37,000
Bitcoin slipped 1% and held over $ 37,500 early Friday, according to CoinDesk. The cryptocurrency had dipped below $ 32,000 late on Tuesday and briefly narrowed gains for the year to less than 10%.
Bitcoin touched a record high of $ 64,800 on April 14th. It is now a fraction since the beginning of June with an annual gain of almost 29%.
Vital Signs: Yield Pullback continues
Oil and copper prices were fixed as bond yields fell to a low level on Friday. The 10-year government yield eased higher to 1.46% after settling just below 1.46% on Thursday, according to CBOE data.
The yield is in the midst of a four-week retreat, tracing its sharpest weekly decline since December. The 10-year interest rate hit a 13-month high above 1.76% on March 30th.
Markets have been keeping an eye on government interest rates as inflation indicators rise higher and as the Federal Open Market Committee prepares for its quarterly meeting next week.
IBD Live: A new tool for daily stock market analysis
Dow Jones Today: Bringing The Rear
The S&P 500 took a new high, and the Nasdaq closed back over 14,000 on Thursday. The Dow Jones opens today as the market lagged behind for the week, down 0.8% through Thursday. The S&P 500 has increased by 0.2%. Nasdaq has a gain of 1.5% as it reaches its fourth-straight weekly advance.
The IBD 50 index has so far risen 1.5% for the week and is on par with its 10-week moving average. Innovator IBD 50 ETF (FFTY) has fallen by 0.3%. Innovator IBD Breakout Opportunities ETF (BOUT) shows a decrease of 0.4%.
The stock market last Friday had its status upgraded to “resumption of trends” for the first time since May 12th. The Nasdaq Composite triggered the change and bounced back over support to its converged moving average of 50 days and 21 days. It added this cushion of support Monday, Tuesday and Thursday, giving it some momentum as it enters the resistance test at 14,000.
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The improved market status suggests that investors are adopting a slightly more aggressive game plan. However, the White House / GOP’s efforts to find common ground on infrastructure spending as well as the uncertainty surrounding the Federal Reserve strategy remain significant stumbling blocks to market confidence.
Investors rotating back out of cash and into fundamentally strong stocks and ETFs breaking out of sound card patterns should not jump in at once. Keep new positions small to start. The market will tell you pretty quickly whether it was a good timed purchase or not. Stay disciplined and stick to sound buying and selling rules.
Shares to see: Alphabet, material used
Among the growth stocks highlighted by IBD’s investment action plan this week, Google parent Alphabet (GOOGL) has risen 1.7% and closes Thursday just above a flat base buy point of 2,431.48. The alphabet is in the current IBD Leaderboard line-up.
Dell Technologies (DELL) has a gain of 0.3%. It ended Thursday in a buy range over a 103.90 flat base entry. Dell is an IBD SwingTrader list.
Material used (AMAT) is down 1.2% for the week, testing support for its 50-day moving average. Shares have formed a handle that lowers the stock’s buying point to 142.22 from 146.10. Applied Materials is an IBD Leaderboard file.
A three-day rally is abandoned Bio Techne (TECH) rose 2.7%. Shares are working on a fourth straight weekly advance and closing 2% on Thursday below a buy point of 444.93 from a flat base.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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