The Dow Jones Industrial Average closed slightly higher, with Apple stock as the top performer. Tesla and Arm, however, experienced significant declines due to bearish calls. Meanwhile, stocks like Lowe’s and Hilton, held by prominent investor Bill Ackman, are eyeing potential buy points.
In terms of sector performance, energy and technology were the strongest performers, while consumer discretionary and real estate underperformed. The Nasdaq remained below its 50-day moving average, closing with a modest 0.1% gain. The S&P 500 also struggled to surpass its 50-day line, ending the day with a marginal gain of 0.1%.
Small caps faced bearish pressure, with the Russell 2000 falling below its 200-day line. Growth stocks also faced difficulties, with the Innovator IBD 50 ETF closing flat after initially gaining.
Apple stock stood out on the Dow Jones, rising 1.7% boosted by reports of strong demand for its high-end iPhone 15 models. Visa and Travelers also performed well, while American Express lagged behind.
In terms of Bill Ackman’s stocks, Lowe’s formed a cup with handle base but has fallen under its 50-day moving average, raising concerns. Hilton, on the other hand, formed a flat base and showed better technicals. Both stocks are held by Pershing Square, Ackman’s hedge fund firm.
Tesla stock faced a downturn following a bearish analyst call that lowered profit outlooks for 2023 and 2024. Tesla shares declined by 3.3% but remained above the 50-day line.
Arm stock, which had a strong IPO debut, has been losing some gains. An analyst’s underperform rating and concerns over its presence in the mobile and consumer markets contributed to a more than 4.5% decline.
Other stocks nearing potential buy points include BWX Technologies, which has entered a buy zone, as well as Booking and Helmerich & Payne, which are forming flat bases with specific buy points. These stocks have favorable performance indicators and show potential for growth.
Source: IBD Stock Analysis, Michael Larkin
Definitions:
– Dow Jones Industrial Average: A stock market index that measures the performance of the 30 largest publicly traded companies in the United States.
– Bearish: Referring to a market outlook where prices are expected to decline.
– Buy point: A specific price at which an investor may want to purchase a stock.
– Tech-heavy Nasdaq: Referring to the Nasdaq Composite index, which includes many technology-related companies.
– S&P 500: A stock market index that measures the performance of 500 large companies listed on stock exchanges in the United States.
– Small caps: Referring to small-capitalization stocks, which are companies with relatively small market capitalizations.
– Stock market today: Referring to the current state and trends of the stock market.
– IPO: Initial Public Offering, the first sale of a company’s shares to the public.
– Composite Rating: A rating assigned to a stock based on various performance indicators.
– Technical picture: Referring to the analysis of a stock’s price movements, trends, and patterns.
– EPS Rating: Earnings Per Share Rating, a measure of a company’s profitability.
– Relative strength line: A line that compares the performance of a stock against a benchmark or index.
– Entry: The point at which an investor buys a stock or enters a position.
– Moving average: A calculation that smoothes out the fluctuations in a stock’s price over a specific period of time.
– Analyst call: A report or recommendation made by a financial analyst regarding a particular stock or investment.
– Price target: The projected or estimated price level at which a stock is expected to reach.
– Laggard: A stock or investment that has underperformed compared to its peers or the overall market.
– Power generation systems play: Referring to a company involved in the production and supply of power generation equipment or services.
– Leaderboard: A list of top-performing stocks published by Investor’s Business Daily (IBD).
– Composite Rating: A rating that combines multiple fundamental and technical indicators to evaluate a stock’s overall performance.
– Flat base: A chart pattern where a stock consolidates by trading in a relatively narrow price range.
– Support: A price level at which buying interest is expected to outweigh selling pressure, preventing further decline in a stock’s price.
– Analyst’s underperform rating: An analyst’s opinion that a stock is expected to perform worse than the market average or its peers.
– Mobile and consumer markets: Referring to the markets for mobile devices and consumer products.
– MarketSmith analysis: Market analysis and research platform provided by Investor’s Business Daily (IBD).
Sources:
– IBD Stock Analysis by Investor’s Business Daily (IBD)
– Michael Larkin