The Dow Jones Industrial Average rallied on Friday on another dose of inflation data, the Personal Consumption Spending Index. Amazon stock plummeted on a weak selling outlook, while Apple, Intel and Chevron stock all climbed on earnings gains.
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Amazon (AMZN) shares slumped nearly 10% after the company late Thursday reported third-quarter results that topped earnings but gave an outlook that fell short. Apple (AAPL) shares are up more than 4% in morning trade. Late Thursday, the tech titan topped Wall Street’s targets for the fiscal fourth quarter thanks to strong iPhone and Mac computer sales.
Meanwhile, the Federal Reserve’s preferred gauge of inflation came out at 8:30 a.m. ET on Friday morning. The PCE price index rose 0.3% in September, according to estimates. Year over year, the PCE index rose 6.2%, weaker than the 6.3% estimate. Personal income rose 0.4% in September, just above estimates that called for a 0.3% rise.
The PCE Price Index is a measure of US inflation and tracks changes in the prices of goods and services purchased by consumers across the economy.
Stock market today: Chevron, Intel Earnings
Other key gain drivers on Friday were Dow Jones stocks rafters (CVX) and intel (INTC), along with the energy giant Exxon Mobile (XOM) and market leader in the field of renewable energies first sun (FSLR).
Chevron stock rose 1.9%, while Intel stock rose 8% after beating lowered third-quarter expectations and cutting fourth-quarter guidance. Exxon shares are up about 2%. And First Solar’s stock rose more than 2% despite missing earnings and revenue targets.
Giant of electric vehicles Tesla (TSLA) traded down about 2% on Friday morning while Dow Jones was the technology leader Microsoft (MSFT) was higher after the market open today.
AutoZone (AZO), cardinal health (CAH), Eli Lilli (LLY) and Texas Roadhouse (TXRH) – as well as Dow Jones stocks note (MRK) and United Health Group (UNH) – are among the top stocks to buy and watch. Remember, the new stock market rally is the perfect time for investors to put their watch lists into action and hone their pyramid technique.
Young rallies, especially those battling bear markets, often fail. Pyramiding provides a method of gradually entering new stock positions to minimize capital risk.
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 was up 1.3%, while the S&P 500 was up 0.8%. The tech-heavy Nasdaq Composite gained 0.7% in morning action, with Amazon trading at the bottom of the list.
Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) was up 0.2% and SPDR S&P 500 ETF (SPY) was up 0.5%.
The 10-year Treasury yield rose to 4.01% on Friday morning, paring 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 in the following three sessions. The 10-year Treasury yield is expected to start 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.
Stock market rally continues
On Thursday, the Dow Jones Industrial Average rose 0.6% while the S&P 500 fell 0.6%. The tech-heavy Nasdaq Composite lost 1.6%.
Thursday’s Big Picture commented, “Investors should continue to follow companies that are slightly beating earnings results and showing strong bullish reactions, such as: Enphase Energy (ENPH), which was Wednesday’s IBD stock of the day. They could be among the top stock markets if the market is able to shed its recent losses and rally higher.”
Now is an important time to read IBD’s The Big Picture column. After last week’s hefty gains, investors are looking to get their curated watchlists up and running to jump on future breakouts. But not all follow-throughs work, so it’s important to slowly and methodically increase engagement as the new uptrend proves its worth.
Check out IBD stock lists, like the IBD 50 and stocks near a buy zone, for stock ideas.
Five Dow Jones stocks to buy and watch
Dow Jones Stocks to Buy and Watch: Merck, UnitedHealth
Merck broke the buy point of a double bottom at 93.12 after reporting a solid third-quarter hit on Thursday. The 5% buy area rose to 97.78. Merck shares traded a fraction lower on Friday.
According to pattern recognition by IBD MarketSmith, healthcare giant UnitedHealth is nearing the handle cup buy point of 553.23. Shares fell 0.25% on Thursday, just underperforming the stock’s most recent entry.
UNH shares rose 0.4% on Friday morning.
4 Top Growth Stocks to Watchrightde Stock market rally
Top stocks to buy and watch: AutoZone, Cardinal, Eli Lilly, Texas Roadhouse
Auto parts leader and latest IBD stock of the day AutoZone is outside of the buy range above the buy point of a cup basis of 2,362.34 after rising 4.05% on Thursday. The 5% pursuit zone rose to 2,480.46. AutoZone shares rose 0.1% on Friday.
IBD leaderboard stock Cardinal Health is just outside the buy range behind a short cup with handle entry of 71.22, according to chart analysis by IBD MarketSmith. Shares are also above the buy point of a flat base of 72.38. The profits are scheduled for November 4th. CAH stock was up 0.7% early Friday.
IBD SwingTrader stock Eli Lilly closed above its buy range above the buy point of a flat basis at 335.43, up 1.9% on Thursday. Shares rose 1.3% on Friday morning ahead of next Tuesday’s earnings report.
Texas Roadhouse continued to move above the buy point from a flat base of 95.52 during Thursday’s 1.5% gain. But the stock fell 3.5% after the company’s earnings results.
Join IBD experts as they analyze leading stocks from the current stock market rally on IBD Live
Tesla stock
Tesla shares rose 0.2% on Thursday, climbing for a third straight session and continuing to recover after hitting a 52-week low on Monday. Despite recent gains, the stock ended about 46% below its 52-week high.
Shares of the EV giant are down around 2% as of Friday morning.
Dow Jones Leaders: Apple, Microsoft
Among the Dow Jones stocks, Apple shares fell 3.05% on Thursday, falling sharply for the second straight day. Stocks faced strong resistance around their 50-day moving average this week, which is an important level to watch. Apple shares rose more than 4% after the company’s earnings late Thursday.
Microsoft was down another 2% on Thursday, nearing its recent lows. Earlier this week, the stock faced clear resistance at its 50-day moving average. The software giant is down about 35% from its 52-week high. Microsoft shares rose 0.4% on Friday morning.
Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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