The Dow Jones Industrial Average edged higher as the stock market ended a three-week losing streak. Tesla ( TSLA ) jumped as Elon Musk eyes new facility. Warren Buffett stock RH (RH) increased on the results. apple (AAPL) closed in on an important benchmark.
A number of stocks passed buy points. Palo Alto Networks (PANW) passed an early entry while Archer-Daniels-Midland (ADM) and Burger King parent Restaurant brands (QSR) attempted breakout.
Volume was mixed, moving higher on the Nasdaq but falling on the New York Stock Exchange, according to early data.
The yield on the benchmark index for 10-year government bonds rose three basis points to 3.32%. West Texas Intermediate crude rose nearly 3% to more than $86 a barrel.
Positive signs for the economy helped the market shake off hawkish noises from some senior Federal Reserve officials, according to Oanda senior market analyst Edward Moya.
“Economists are lowering their inflation forecasts a bit, and that could mean the Fed doesn’t need to go above 4%,” he said in a note to clients. “Another round of hawkish speech from both the Fed’s Bullard and Waller failed to derail today’s stock market rally.”
Nasdaq leads when small caps shine
The Nasdaq was the best performer of the major indexes as it rose 2.1%. Cyber security action Zscaler (ZS) was a top performer here, rocketing nearly 22% on revenue.
The S&P 500 also added muscle, jumping 1.5% and climbing back above its 50-day line. Dish Network ( DISH ) impressed here as it rose 8.6%.
The S&P 500 sectors were all positive, with communications services, technology and energy the top gainers. The defensive supply area gave way.
Small caps shone, with the Russell 2000 up and ending the session up 2%.
The Innovator IBD 50 ETF (FFTY), a watch for growth stocks, also impressed, rising 1.9%.
Dow Jones today: Apple shares rise as Salesforce leads
The Dow Jones Industrials lagged the other major indexes, but was still up nearly 400 points, or 1.2%.
Key component Apple stock is nearing its key 50-day moving average after rising 1.9%. It remains well shy of a handle entry of 176.25.
Earlier this week, the company announced its iPhone 14 smartphone family at a media event titled “Far Out”.
But it was Salesforce (CRM) was the star of the Dow Jones today as it rose 3.6%. larva (CAT) also impressed with a rise of 3.5%.
Tesla stock rises as Elon Musk’s eyes move
Tesla shares got a boost on the news that it is considering building a lithium processing plant in Texas. The electric vehicle giant, led by Elon Musk, is eyeing a facility to refine lithium hydroxide on the Gulf Coast of Texas.
If the project is approved, Tesla says it could begin construction by the fourth quarter, with commercial production starting by the end of 2024.
Tesla storage has formed a consolidation with a buy point of 402.73, according to MarketSmith analysis. It’s still a long way from its entry, but was up 3.6% for the day.
Adventurous investors may choose to use the retracement of the 200-day line on Friday as an entry, although this would be a very aggressive move.
Elon Musk also revealed in a tweet that he has had some “promising conversations” with iPhone giant Apple about using SpaceX’s Starlink system for connectivity.
Warren Buffett shares rise with earnings
RH, formerly known as Restoration Hardware, jumped after its latest earnings report. It ended the session up 4.4%.
Warren Buffett is a fan of the home furnishings retailer, with his firm Berkshire Hathaway (BRKB) currently has more than 2 million shares.
The legendary investor has reason to smile after RH released a profit report that exceeded the expectations of Wall Street. EPS of $8.08 came well above analysts’ views, while revenue of $992 million also beat.
It wasn’t all good news, however, as the firm said it expects third-quarter net income to fall 15% to 18%. The company’s CEO, Gary Friedman, said the economy is now in a recession.
“Anyone who thinks we’re not in a recession is crazy,” Friedman said on the conference call.
Outside Dow Jones: New manager passes entry
With the market rally gathering momentum again, now is the time to look for stocks to trade.
Palo Alto Networks crossed a trend line near 560. It is also looking for a higher cup-with-handle buy point at 578.89.
The stock won promotion to the IBD Leaderboard list of top stocks following its bullish move. It gathered in sympathy with its rival Zscaler (ZS).
Food processing giant Archer-Daniels-Midland broke past a cup-with-handle entry at 91.54, although it closed just below the entry. This is a third-stage base, which means that gains from the next breakout may be limited.
The relative strength line has moved higher even as the stock formed the handle, a bullish sign. The stock is among the top 6% of stocks in terms of price performance over the past 12 months, while earnings growth has also been strong. Analysts see profits rising 31% in 2022, according to MarketSmith data.
Burger King parent Restaurant Brands tested a cup-with-handle buy point of 61.19, coming within a few kroner of passing the entry. It closed within touching distance, so it’s one to watch.
The restaurant chain is among the top 11% of stocks in terms of price performance over the past 12 months. It has a strong composite rating of 95.
Follow Michael Larkin on Twitter at @IBD_MLarkin for more growth stock analysis.
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