The Nasdaq composite started to make headway in morning trading Thursday as investors digested a growing plate of earnings news and gained some ground. Meanwhile, chip giant Nvidia (NVDA) undercut its 50-day moving average on the stock market today, testing the bulls. And Taiwan Semiconductor (TSM), a fellow chipmaker, delivered a defensive sell signal.
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Nearly an hour into the session, the Nasdaq composite edged less than 0.2% lower, then erased those losses to post a 0.5% gain. The Nasdaq has fallen more than 3% for the week, marking the worst performance since the tech-centered index slid more than 3.2% in the first week of January.
The S&P 500 traded near break-even initially, then bobbed 0.6% higher. It headed into Thursday’s session up 5.3% year to date. The Russell 2000 moved up 0.9%, while the Dow Jones Industrial Average climbed 0.8%.
Meanwhile, the benchmark U.S. 10-year government bond yield rose 5 basis points to 4.63%.
Stock market investors are focusing on the outlooks given by companies reporting quarterly results. Watch for earnings from Netflix (NFLX) and Intuitive Surgical (ISRG) after the regular session close.
Gains in any of the indexes have been meager even though the Philadelphia Fed’s manufacturing index showed a larger-than-expected rise to 15.5 in April. The Econoday forecast called for a zero reading. Weekly jobless claims inched up to 212,000, but remained below expectations of 215,000.
Nvidia Ekes Out A Gain, Taiwan Semi Slumps
Nvidia, the leader in data-center chipsets for accelerated computing and artificial intelligence, whipsawed traders as it briefly fell but then rebounded for a gain of 1.5% on the stock market today.
Readers can go to Leaderboard for a full analysis of the Nasdaq megacap tech’s chart action. The company maintains a three-quarter-size position on the model portfolio for winning growth stocks.
Taiwan Semi sank more than 4% in rapid turnover. The stock spurred a profit-taking signal by dropping sharply below its 50-day moving average. The chip giant also slashed through its 10-week line for the first time in more than five months.
The company reported a 9% rise in profit to the equivalent to $1.38 per share. That snapped a three-quarter slump in the bottom line. But investors apparently focused on the company’s revision to its 2024 sales outlook.
Management also said the company would take a 50-basis-point hit to profit margins, according to MarketWatch. Taiwan Semi said the massive Taiwan earthquake, while not causing major structural damage to facilities, rendered batches of its chips useless.
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Bank stocks helped the market’s cause in Thursday’s action.
Comerica (CMA), a super-regional bank, jumped nearly 4% despite missing Wall Street’s revenue estimate, coming in at $784 million vs. a forecast of $806 million. But Comerica posted adjusted earnings of $1.29 per share, 17 cents above the consensus view.
The news helped boost peers including JPMorgan Chase (JPM), a Dow Jones stock, Wells Fargo (WFC) and Bank of America (BAC). Wells Fargo is near a potential breakout at 58.44; Bank of America is trying to reclaim its rising 50-day moving average, a bullish sign.
Elsewhere on the cyclical side of the stock market, D.R. Horton (DHI) attempted to retake its 50-day line with a gain of more than 3% in heavy volume on the stock market today. The major U.S. homebuilder reported March-quarter earnings of $3.52 a share, up 29% vs. a year ago. Wall Street saw earnings of $3.07 a share.
Horton’s sales rose 14% to $9.11 billion, smashing the FactSet consensus view of $8.15 billion. Horton shares recently triggered a loss-cutting sell rule when it fell 7% below a breakout point of 157.93 in a shallow nine-week cup-style base.
Please follow Chung on X/Twitter: @saitochung and @IBD_DChung
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