The Dow Jones Industrial Average rose Friday on another dose of inflation data, the index of personal consumption expenditures. Amazon shares plunged on weak sales outlook, while Apple, Intel and Chevron shares all climbed on earnings pace.
Amazon ( AMZN ) shares fell nearly 10% after the company late Thursday reported third-quarter results that beat earnings but gave an outlook that fell short. apple ( AAPL ) stock rose more than 4% in morning trading. Late Thursday, the tech titan beat Wall Street’s fourth-quarter targets thanks to strong sales of iPhones and Mac computers.
Meanwhile, the Federal Reserve’s preferred inflation gauge came out Friday morning at 8:30 a.m. ET. The PCE price index rose 0.3% for the month of September, in line with estimates. Year over year, the PCE index rose 6.2%, cooler than the estimate of 6.3%. Personal income rose by 0.4% in September, just above estimates which called for an increase of 0.3%.
The PCE price index is one measure of US inflation, and tracks the change in the prices of goods and services purchased by consumers throughout the economy.
The stock market today: Chevron, Intel’s earnings
Other key earnings drivers on Friday were Dow Jones stocks Chevron (CVX) and Intel (INTC), together with the energy giant Exxon Mobil (XOM) and renewable conductor First Solar (FSLR).
Chevron shares rose 1.9%, while Intel shares jumped 8% after beating expectations for the third quarter and cutting its outlook for the fourth quarter. Exxon shares rose around 2%. And First Solar shares rose more than 2% despite missing earnings and revenue targets.
Electric vehicle giant Tesla ( TSLA ) was trading down about 2% Friday morning, while the Dow Jones technical lead Microsoft (MSFT) was higher after today’s market opening.
AutoZone (AVOID), Cardinal health (CAH), Eli Lilly (LLY) and Texas Roadhouse (TXRH) – as well as Dow Jones stocks Merck (MRK) and UnitedHealth Group (UNH) — is among the best stocks to buy and watch. Remember, the new stock market rally is the perfect time for investors to start their watch lists and to hone their pyramid scheme.
Young rallies, especially those battling bear markets, often fail. Pyramiding provides a method of moving into new equity positions incrementally, to minimize the risk to the capital.
Cardinal and Texas Roadhouse are IBD Leaderboard stocks. UnitedHealth was featured in this week’s Stocks Near A Buy Zone column, along with three other top stock ideas.
Dow Jones today: Treasury yields, oil prices
After Friday’s opening bell, the Dow Jones Industrial Average rose 1.3%, while the S&P 500 rose 0.8%. The tech-heavy Nasdaq Composite gained 0.7% in morning action, with Amazon trading at the bottom of the chart.
Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) traded up 0.2%, and the SPDR S&P 500 ETF (SPY) rose 0.5%.
The 10-year Treasury yield ticked up to 4.01% on Friday morning, cutting into this week’s losses. On Monday, the 10-year Treasury yield closed at 4.23%, settling at its highest level since June 2008 before falling over the following three sessions. The 10-year Treasury yield is set to snap a 12-week winning streak.
Meanwhile, US oil prices fell more than 1% on Friday, threatening to end a four-day winning streak. West Texas Intermediate futures traded below $88 a barrel.
The stock market rally continues
On Thursday, the Dow Jones Industrial Average rose 0.6 percent, while the S&P 500 fell 0.6 percent. The technology-heavy Nasdaq composite lost 1.6%.
Thursday’s The Big Picture commented: “Investors should continue to track companies that easily beat earnings results and have strong upside reactions, such as Enphase Energy (ENPH), which was Wednesday’s IBD Stock Of The Day. They could be among the stock market leaders if the market is able to shrug off recent losses and move higher.”
Now is an important time to read IBD’s The Big Picture column. After last week’s strong gains, investors want to put their curated watchlists to work, to jump on future breakouts. But not all follow-ups work, so it’s important to increase your exposure slowly and methodically as the new uptrend emerges.
Check out IBD stock lists, such as the IBD 50 and stocks near a buy zone, for stock ideas.
Five Dow Jones Stocks to Buy and Watch Now
Dow Jones stocks to buy and watch: Merck, UnitedHealth
Merck is extended beyond a double-bottom 93.12 buy point after reporting a solid third-quarter beat on Thursday. The 5% buy range went up to 97.78. Merck shares traded a fraction lower on Friday.
UnitedHealth healthcare is approaching the buy point for a cup with a handle at 553.23, according to IBD MarketSmith pattern recognition. Shares fell 0.25% on Thursday, just shy of the stock’s latest entry.
UNH stock was up 0.4% Friday morning.
4 top growth stocks to watch right nowra stock market rally
Top Stocks to Buy and Watch: AutoZone, Cardinal, Eli Lilly, Texas Roadhouse
Auto parts leader and recent IBD Stock Of The Day AutoZone is out of buy territory past a cupbase’s 2,362.34 buy point after running higher 4.05% on Thursday. The 5% hunting zone went up to 2,480.46. AutoZone shares rose 0.1 percent on Friday.
IBD Leaderboard stock Cardinal Health is just outside buy territory past a short cup handle at 71.22, according to IBD MarketSmith chart analysis. The shares are also above a flat base buy point of 72.38. Earnings are estimated for 4 November. CAH shares were up 0.7% early Friday.
IBD SwingTrader stock Eli Lilly closed past buy territory above a flat-base buy point of 335.43, climbing 1.9% on Thursday. Shares rose 1.3% on Friday morning, ahead of next Tuesday’s earnings report.
Texas Roadhouse moved further above a flat base’s 95.52 buy point during Thursday’s 1.5% gain. But the stock fell 3.5% after the company’s results.
Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live
Tesla shares were up 0.2% on Thursday, rising for a third straight session and continuing to rise after hitting a 52-week low on Monday. Despite recent gains, the stock closed about 46% off its 52-week high.
Shares of the EV giant were down around 2% on Friday morning.
Dow Jones Leaders: Apple, Microsoft
Among the Dow Jones stocks, Apple shares sold off 3.05% on Thursday, falling sharply for the second day in a row. Shares faced strong resistance around the 50-day line this week, which is a key level to watch. Apple shares rose more than 4% after the company’s results late Thursday.
Microsoft fell another 2% on Thursday, heading back toward recent months’ lows. Earlier this week, the stock faced clear resistance at its 50-day line. The software giant is about 35% off its 52-week high. Microsoft shares rose 0.4 percent on Friday morning.
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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