Dow Jones reverses after key economic data; Warren Buffett stock jumps on upgrade
The Dow Jones Industrial Average turned slightly higher Tuesday amid key economic data, including a consumer confidence reading and two home price indices. Warren Buffett stock Occidental Petroleum (OXY) rallied on an analyst upgrade, while the Chinese e-commerce giant Ali Baba (BABA) jumped on a massive restructuring plan.
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The consumer confidence index rose to 104.2, topping Wall Street estimates for a 101.0 reading in March, down slightly from February’s 102.9 reading. The Case-Shiller house price index rose 2.5% in January, less than the expected 3.7% increase against December’s 4.6% increase. Furthermore, FHFA’s house price index rose 0.2% compared to the expected fall of 0.2% for January.
Walgreens Boots Alliance ( WBA ) rose nearly 2% Tuesday after the company’s second-quarter financial results topped earnings and sales estimates. (For the latest coverage of the market, visit our Stock Market Today page.)
Stock market today: Warren Buffett stock jump
Warren Buffett stock Occidental Petroleum rose 3.5% after TD Cowen upgraded the stock to outperform, with a price target of 70. Late Monday, Securities and Exchange Commission filings showed Buffett’s Berkshire Hathaway (BRKB) increased its stake by 3.66 million shares between March 23 and March 27.
Alibaba, China’s equivalent of Amazon.com (AMZN), rose nearly 11% on plans to split the business into six independently run units. The move represents the largest structural overhaul in Alibaba’s history.
Electric vehicle giant Tesla ( TSLA ) fell 1.6% early Tuesday. Dow Jones technology giants apple (AAPL) and Microsoft (MSFT) was lower after today’s market opening.
Adjust technology (ALGN), IBD SwingTrader stock Meta platforms (META) and IBD Leaderboard Palo Alto Networks (PANW) – as well as Dow Jones stocks Cisco Systems (CSCO) and Nike (NKE) — is among the best stocks to watch in the ongoing stock market correction.
Palo Alto is an IBD Leaderboard stock. Cisco was featured in this week’s Stocks Near a Buy Zone column. And Meta is an IBD SwingTrader stock. Palo Alto, Align, Microsoft and Meta were all recent IBD Stock Of The Day subjects.
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Dow Jones today: Oil prices, Treasury yields
After Tuesday’s opening bell, the Dow Jones Industrial Average was up 0.2%, while the S&P 500 was down 0.1%. The tech-heavy Nasdaq composite fell 0.5% in morning action.
Among U.S. exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust ( QQQ ) lost 0.5%, while the SPDR S&P 500 ETF ( SPY ) also fell 0.2% early Tuesday.
The 10-year US Treasury yield on Monday jumped to 3.52%, snapping a three-day losing streak. Last week, the 10-year yield briefly reached its lowest level since mid-September. On Tuesday, the 10-year ticked up to 3.56%.
US oil prices continued to rise on Tuesday after Monday’s sharp rally, as West Texas Intermediate futures traded above $73 a barrel.
Stock correction
On Monday, the Dow Jones Industrial Average rose 0.6 percent. The S&P 500 pared gains to 0.2%. And the Nasdaq followed with a 0.5% decline as techs slowed.
Monday’s Big Picture column commented: “The Nasdaq and S&P 500 continue an attempted rally that started about two weeks ago. But so far there has been no follow-through signal to confirm a new uptrend. That has left the stock market in an ambiguous place, making provisional progress only to meet sellers.”
Now is an important time to read IBD’s The Big Picture column amid the ongoing stock market correction.
Five Dow Jones Stocks to Buy and Watch Now
Dow Jones stocks to watch: Cisco Systems, Nike
Cisco Systems is nearing a flat base buy point at 51.84, according to IBD MarketSmith pattern recognition. Bullishly, the stock’s relative strength line reached a new high last week, a sign of excess returns in the stock market. CSCO shares fell 0.4% on Tuesday morning.
Nike shares continue to track a flat base that has a buy point at 131.41. The stock failed to hold above its 50-day line last week, facing resistance. The NKE share rose 0.1 percent on Tuesday.
3 top growth stocks to watch Stock correction
Top stocks to watch: Align, Meta, Palo Alto
Align Technology continues to track a consolidation that has multiple buy points: an early entry at 357.10 and a conventional entry at 368.97. ALGN stock is looking for support around its 50-day moving average. If the stock breaks this level, further weakness is expected. ALGN shares rose 0.2% on Tuesday morning.
Background story: The company makes clear teeth straightening systems called Invisalign. UBS analyst Kevin Caliendo says investors have recently regained confidence in Align stock, which is up 50% this year. December-ended quarterly results from Align and its competitors, management comments, US economic data and a recent increase in demand for Invisalign cases support this view, he said in a note to clients.
Background story: Like its social media rivals, Meta is struggling due to a sharp reduction in ad revenue as clients reel over macroeconomic concerns, recession fears and higher interest rates. This comes as it spends billions of dollars in a risky effort to build the “metaverse,” a virtual reality world that has yet to catch on.
IBD Leaderboard stock Palo Alto Networks continues to trade above and below its 192.94 buy point out of a cup with handles amid Monday’s 0.5% gain. The buy range will run up to 202.59 if the stock retraces its entry. The PANW share fell 0.6 percent on Tuesday.
Background story: Through acquisitions, Palo Alto Networks has expanded into endpoint security and vulnerability management. Endpoint tools detect malware on laptops, mobile phones and other devices that access corporate networks.
Learn how to time the market with IBD’s ETF Market Strategy
Shares to watch in the stock market Correction
These are four top stocks to watch in today’s stock market, including two Dow Jones leaders.
| company name | Symbol | Right point of purchase | Type of point of purchase |
|---|---|---|---|
| Meta platforms | (META) | 197.26 | Flat base |
| Nike | (of) | 131.41 | Flat base |
| Palo Alto Networks | (PANW) | 192.94 | Cup with handle |
| Cisco Systems | (CSCO) | 51.84 | Flat base |
Source: IBD data as of March 27, 2023
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Tesla shares
Tesla shares rose 0.7% on Monday as it continues to see some support around its 50-day moving average. Shares closed Monday about 50% off their 52-week high. TSLA stock was down 1.5% on Tuesday morning.
On Tuesday, weekly Chinese electric car insurance registration data could be an important gauge of Tesla’s demand in the world’s largest electric car market, which is in the middle of a huge price war started by Tesla.
Dow Jones Leaders: Apple, Microsoft
Among the Dow Jones stocks, Apple shares fell 1.2% on Monday, ending a two-day winning streak. Shares remain near recent highs. AAPL shares were down 0.6 percent on Tuesday.
Microsoft shares are again trying to capture a flat-base buy point at 276.86, but closed back below the entry during Monday’s 1.5% loss. The stock is just below the 5% buy range that goes up to 290.70. And shares fell 1.1% early Tuesday.
Microsoft shares rose earlier this month after the company announced it is adding artificial intelligence tools to its popular Office productivity applications. It follows the company’s investment in AI startup OpenAI, the firm behind the buzz-worthy ChatGPT application.
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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