The Dow Jones Industrial Average and major stock indexes reversed from a premarket deficit and surged higher in morning trades Friday as an inflation report helped investors shake off concerns over a partial government shutdown. Meanwhile, a Donald Trump stock plunged as Nvidia (NVDA) stock tried to stage a recovery on the stock market today.
Dow stocks added nearly 400 points, or 0.9%, in morning action after blue chips managed to break a 10-day losing streak on Thursday. The S&P 500 jumped 0.8% as well. The Nasdaq reversed from early losses and joined the party with a 0.8% gain.
Volume on the New York Stock Exchange and on the Nasdaq was higher compared with the same time on Thursday. Advancing stocks outnumbered decliners by 4-to-1 on the NYSE and nearly 5-to-2 on the Nasdaq.
Small caps on the Russell 2000 jumped more than 1%, reversing some recent losses. The Innovator IBD 50 (FFTY) exchange traded fund also jumped, gaining 1.6%
Inflation Eases, Bonds Sink
Helping stocks was the fact the Personal Consumption and Expenditure index rose 0.1% vs. economists’ estimates of a 0.2% increase month on month. On an annual basis, the index rose 2.4% vs. views of 2.5%. Core inflation rose 0.1% on a monthly basis and 2.8% annually. Economists had expected a monthly increase of 0.2% and 2.9% annually.
That helped investors overlook the fact that on Thursday, a government spending bill backed by President-elect Donald Trump failed to pass the House. Now, a partial government shutdown looms over the weekend.
Treasury yields surged this week, but on Friday the yield on the benchmark 10-year note fell 5 basis points to 4.52% after the inflation report surfaced.
Elsewhere, the University of Michigan’s survey of consumer sentiment for December met preliminary estimates of 74. And monthly options are set to expire Friday.
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How Invested In The Stock Market Should You Be Right Now?
Stock Market Today: Trump Stock Dives
Trump Media and Technology (DJT) was a big loser on the stock market today after reports the president-elect had moved shares to a revocable trust. Shares fell near the 50-day moving average.
Earnings sent FedEx (FDX) stock soaring at first, but gains were minimized as the session wore on. Sales of $22 billion declined 1% while earnings of $4.05 were 1.5% higher than the prior year. FedEx also announced that it would spin off its freight business. Shares soared over 20% but gave up their gains and fell over 1%. The stock undercut the 50 day moving average in heavy volume — a sell signal.
Carnival (CCL) jumped 3% after fourth-quarter results. Sales of $5.9 billion met views but earnings of 14 cents surprised to the upside. Analysts polled by FactSet had expected 8 cents after a 7-cent loss the prior year. But the stock is well past a profit zone.
Obesity drug leader Novo Nordisk (NVO) plummeted after a late stage clinical trial failed. Its experimental drug CagriSema missed a targeted 25% weight loss. Novo stock fell more than 20%. Rival Eli Lilly (LLY) surged 4% but remained below a downward sloping 50-day moving average.
Among the Magnificent Seven, Tesla (TSLA) added a fraction, reversing from earlier losses. Meta (META) did the same, while Microsoft (MSFT), Amazon (AMZN) and Apple (AAPL) lagged. Alphabet and Meta are on the IBD Leaderboard model portfolio.
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Alphabet | Amazon | Apple | Meta | Microsoft | Nvidia | Tesla
Warren Buffett’s Berkshire Hathaway (BRKB) holding Occidental Petroleum (OXY) jumped nearly 5% amid news that the famed investor had bought another 8.9 million shares of the oil company. Shares are well below their recent highs of 71.19.
Dow Jones: Nvidia Stock Climbs
Nvidia gained ground Friday after the stock finished higher Thursday, though shares of the Dow Jones component remain below their 50-day moving average. Nvidia is on IBD Leaderboard along with a hedge, the Granite 2x Short NVDA Daily ETF (NVD).
Nike (NKE) fell on the stock market today after its earnings report. Sales fell 8% to $12.4 billion while earnings of 78 cents per share also declined 24% from the prior year. Nike stock is meeting resistance at that key level.
Most health care and finance stocks in the Dow gained while tech and retail leaders lagged.
