Dow Jones gains 600 points as Goldman, J&J report earnings; Netflix revenue is due
The Dow Jones Industrial Average rose more than 600 points on Tuesday, as Goldman Sachs and Johnson & Johnson reported earnings results and global markets posted healthy gains. Netflix earnings come after the market closes.
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The stock market today: Earnings season continues
The third quarter earnings season continues, with results from Dow Jones stocks Goldman Sachs (GS) and Johnson & Johnson (JNJ) early Tuesday. Netflix (NFLX) will start technology earnings after the market closes.
Goldman Sachs shares rose 4.5% after topping earnings and sales estimates. J&J shares fell more than 1% after the company reported strong results but cut its full-year sales guidance.
Head of electric vehicles Tesla ( TSLA ) rose more than 4% Tuesday as electric vehicle shares rose in early trading. Among the Dow Jones industrials, tech titans apple (AAPL) and Microsoft (MSFT) was also sharply higher after today’s market opening.
AutoZone (AVOID), Cardinal health (CAH), Molina Healthcare (MOH) and Vertex Pharmaceuticals (VRTX) – as well as Dow Jones stocks Chevron (CVX) and Merck (MRK) — is among the best stocks to watch. Remember, the ongoing stock market correction is a time for investors to sit on the sidelines and build watch lists of top growth stocks.
Cardinal Health and Vertex are IBD Leaderboard stocks. Merck and Molina Healthcare were featured in this week’s Stocks Near A Buy Zone column, along with two other top stock ideas. AutoZone was the IBD Stock Of The Day on Thursday. Cardinal Health was Friday’s stock of the day.
Dow Jones today: Treasury yields, oil prices
After Tuesday’s opening bell, the Dow Jones Industrial Average rose 1.95%, trading up more than 600 points. The S&P 500 rose 2%, with Tesla, Goal (TGT) and Etsy (ETSY) trade near the top of the list. The tech-heavy Nasdaq composite rose 2.3% in morning action.
Overseas, markets across Asia generally closed with solid gains. In Europe, markets traded sharply higher in afternoon action.
Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) was up 2.6%, and the SPDR S&P 500 ETF (SPY) rose 2.2%.
The 10-year Treasury yield recovered early losses to trade narrowly above 4%, about even with Monday’s close. US oil prices fell more than 1% on Tuesday, threatening to extend the latest streak of losses. West Texas Intermediate futures held just above $83 a barrel.
The stock market rally attempt continues
On Monday, the Nasdaq composite led with a 3.4% breakout. The S&P 500 rose nearly 2.7% and the Dow Jones Industrial Average rose 1.9%.
Monday’s The Big Picture commented: “The indices are holding above Thursday’s lows, which for the time being marks the start of a rally attempt. Tests of resistance at their 21-day exponential moving averages are coming next for the major indices. Recent attempts have failed to do so.” done well, so the 21-day lines certainly bear watching. Also remember that the indices are jumping from oversold levels. Therefore, waiting for a follow-up is the first step in moving exposure back to equities.”
Psychologically, watching the market work through repeated rally attempts can be a challenging process. Investors want to have watch lists available to jump on follow-up days. But not all follow-ups work, so buying too early or with too much conviction can lead to frustration.
This is why it is important to increase exposure slowly and methodically as the uptrend manifests itself.
Check out IBD stock lists, such as the IBD 50 and stocks near a buy zone, for stock ideas.
Five Dow Jones stocks to watch now
Dow Jones stocks to watch: Chevron, Merck
Energy giant Chevron continues to hold above support at its 50-day line, consolidating below a 182.50 buy point ahead of the company’s Oct. 28 earnings call. Chevron shares rose 0.6% early Tuesday, shrugging off the drop in oil prices.
CVX stock has a strong 98 out of a perfect 99 IBD Composite Rating, according to IBD Stock Checkup. Investors can use the IBD Composite Rating to easily measure the quality of a stock’s fundamental and technical metrics.
Dow Jones member and IBD 50 stock Merck breaks out above a double-bottom 93.12 buy point, according to IBD MarketSmith pattern recognition. The relative strength line hit a new high last week. Third quarter results are due on 27 October before the opening bell.
Merck shares rose 0.3% on Tuesday morning and are above the buy point.
4 top growth stocks to watch right nowrent stock market correction
Top stocks to watch: AutoZone, Cardinal, Molina, Vertex
Auto parts leader and recent IBD Stock Of The Day AutoZone is about 3% away from a cupbase buy point of 2,362.34. Keep an eye out for a potential handle to offer a lower entry. AutoZone shares rose 0.2% early Tuesday.
IBD Leaderboard stock and medical leader Cardinal Health is forming a flat base that has a buy point at 72.38, according to IBD MarketSmith chart analysis. Earnings are due on November 4. Shares rose 1.8% on Tuesday.
Molina Healthcare ended Monday just 2% below a flat-base buy point of 361.35. The stock’s RS line hit a new high last week, confirming that healthcare is a leader to watch. Molina’s earnings are expected on October 26. The MOH share rose 1.4% early Tuesday.
Biotech leader Vertex Pharmaceuticals continues to build a flat base with a buy point at 306.05 and an early entry at 296.90. Its RS line has hit a new high in recent sessions, a sign of big stock market gains. Earnings are due on 27 October. Shares rose 1.8% on Tuesday morning.
Netflix revenue
The Netflix earnings will come on Tuesday after the stock market closes. The streaming giant’s adjusted earnings are expected to fall 33% to $2.14 a share on revenue of $7.83 billion.
Netflix shares are building a double bottom base with a buy point at 250.49. The stock is about 65% off its 52-week high.
Join IBD experts as they analyze leading stocks in the current stock market rally attempt on IBD Live
Tesla shares
Tesla shares rose 7% on Monday, nearly erasing Friday’s 7.55% plunge. On Friday, shares closed at their lowest level since June 2021. Despite Monday’s rally, the stock is still about 47% lower than its 52-week high. Tesla shares rose 4.2 percent on Tuesday.
The EV giant’s results for the third quarter will come late on Wednesday. Tesla is expected to earn an adjusted $1.01 per share on sales of $22.1 billion.
Dow Jones Leaders: Apple, Microsoft
Among the Dow Jones stocks, Apple shares rose 2.9% on Monday, back from Friday’s 3.2% selloff. Still, shares are about 23% off their 52-week high and below the 50- and 200-day lines. AAPL stock rose 2.7% Tuesday morning.
Microsoft climbed 3.9% on Monday, continuing its retreat from last week’s 52-week low. The software giant is about 32% off its 52-week high. Shares rose 2.3% early Tuesday, as the company reportedly trimmed nearly 1,000 jobs. Meanwhile, Barclays maintained an overweight rating on the Dow Jones stock, reducing its price target from 335 to 310.
Apple earnings are expected on October 27, while Microsoft’s is due on October 25.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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