The stock market today lost opening gains and the major indexes moved lower in the first 45 minutes of trading. Nvidia staged a follow-on buy point. Chip shares led the upside, but enterprise software firms continued to cool.
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Bond prices continued to weaken, sending up yields and creating a near-term headwind for stocks.
The Dow Jones Industrial Average bore the brunt of the early-morning selling, down 0.6% to 38,221. At least seven of the 30 components slumped 2 points or more, including Wall Street giant Goldman Sachs (GS). On Friday, JPMorgan Chase (JPM), BlackRock (BLK) and Wells Fargo (WFC) are among the financial institutions that report first-quarter results.
A New Buy Point For Nvidia
Nvidia (NVDA), a mainstay on the Leaderboard portfolio for more than a year, tested the 10-week moving average near 841 and is trying to erase losses for the week. Shares in the AI processor powerhouse gained as much as 14 points to an early-session high of 884.96. Some of those gains faded.
The megacap tech holds a sterling 99 Composite Rating on a scale of 1 to 99.
This Investor’s Corner highlights the benefit of buying powerful growth stocks on the first or second pullbacks to the 10-week line after a strong breakout.
Stock Market Today
At around 10:15 a.m. ET, the Nasdaq composite rose slightly but had lost a gain of around 0.5%. The S&P 500 and S&P MidCap 400 lost 0.3% to 0.4%. The Russell 2000, which undercut its 50-day moving average Wednesday in the wake of a disappointing report on March consumer prices, eased nearly 0.3%.
Volume was running sharply lower on both the Nasdaq and NYSE stock exchanges vs. the same time on Wednesday.
Also on Thursday, savvy investors are keeping a close eye on the cost of money. In recent days, the yield on the 10-year U.S. Treasury bond has lifted from 4.3% to as high as 4.58%. As bond prices fall, their return (or yield) goes up, making them more appealing vs. equities.
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Going back to tech stocks, Marvell Technology (MRVL) is reportedly planning an event to discuss its AI initiatives. The stock rallied nearly 0.9% early and is trying to form a new base. It later erased early gains, however.
Alphabet (GOOGL), the web search titan that is also working on its own chips for cloud computing and accelerated computing, continued to move past a fresh buy point of 153.78 in a nine-week base. The stock is in the buy zone up to 161.47. Google shares, up roughly 0.4%, are on track to rise four of the past five sessions.
Not all stocks in the semiconductor space joined Nvidia to the upside.
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Intel (INTC) has shown sour action since gapping down 8% on April 3. Since then, the chip manufacturing behemoth has sunk below the long-term 200-day moving average.
Leading Retailer
Elsewhere in the stock market, Costco Wholesale (COST) attempted to retake its 50-day line as shares moved mildly higher and attempted a third straight gain. The company announced a quarterly dividend hike of 14 cents to $1.16 per share. A new base is forming.
After the close Wednesday, the membership-based discount retail chain posted a 6.4% jump year over year in net sales for the first 31 weeks of its fiscal year, to $146.6 billion.
On the downside, Regeneron Pharmaceuticals (REGN) dropped more than 2% to its lowest level since mid-January. A big slide below the 50-day moving average last week did not come in heavy volume. However, loss of support at the key technical level suggests further weakness ahead.
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The biotech giant is reportedly being investigated by the Department of Justice for potential pricing fraud related to its Eylea medicine to treat wet age-related macular degeneration. Regeneron shares hold a mediocre 73 Relative Strength Rating. The RS line has been sloping lower since late February.
Please follow Chung on Twitter: @saitochung and @IBD_DChung
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