The Dow Jones Industrial Average lost ground Friday morning amid an earnings sell-off for Nike stock. Tesla stock also fell sharply on the stock market today amid news the company is reducing production at its Shanghai factory due to slack demand.
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Nike (NKE) was down more than 8% after the company reported a 24% increase in adjusted profit. Revenue was flat at $12.4 billion. The company acknowledged its direct-to-consumer strategy shift is facing challenges. Nike also said it’s losing share in the running category. The stock has been on a sharp downtrend since it gapped down on earnings in December.
Tesla (TSLA) pared some of its losses Friday, and was down 1.8% in recent action. The electric-vehicle giant reportedly is cutting production at its Shanghai factory due to waning demand.
Lululemon (LULU) didn’t fare much better. Shares plunged more than 15% after the company reported a 20% increase in quarterly profit. Revenue increased 16% to just above $3.2 billion, but the company warned of softening demand in North America. Lululemon stock gapped below its 200-day moving average, a longer-term support level.
Apple (AAPL) was mostly flat on the Dow Jones index after Thursday’s sell-off in higher volume. Sentiment was negative after the Department of Justice sued Apple, accusing the company of maintaining an iPhone monopoly.
Stock Market Today
Along with the Dow, the Nasdaq composite, S&P 500 and Russell 2000 small-cap index also dropped after the S&P 500 marked a stalling session Thursday. Stalling is another version of distribution, which is important to monitor during a stock market uptrend. When distribution days start to cluster in the Nasdaq and S&P 500, it can forewarn a looming pullback.
Losers beat winners on the Nasdaq by nearly 2-to-1. The ratio was less than 2-to-1 negative on the New York Stock Exchange.
See Which Stocks Are In The Leaderboard Model Portfolio
The 10-year Treasury yield was down 5 basis points to 4.22% after the Federal Reserve on Wednesday flagged three rate cuts before the end of the year, in line with market expectations.
FedEx (FDX) was the top gainer in the S&P 500, up more than 8%, helped by a strong earnings report and news of a $5 billion share buyback program.
Reddit (RDDT) slumped more than 7% on the stock market today after a strong debut Thursday. The stock priced at 34 Wednesday night and closed Thursday at 50.44.
Stocks On The Move
Inside the MarketSurge Growth 250, Google parent Alphabet (GOOGL) outperformed with a gain of more than 2%. Wedbush raised Alphabet’s price target to 175 from 160 while maintaining an outperform rating.
Bitcoin-related stocks lagged, with bitcoin down 3% to just over $63,000. MicroStrategy (MSTR), which has recently announced some debt offerings to help it buy more bitcoin, was down more than 4%.
At the end of February, MicroStrategy owned about 193,000 bitcoins worth $11 billion.
In the chip space, Arm continues to show strength and support after surging on earnings in February. A pullback and successful test of the 10-week moving average, currently around 113, would put Arm in an alternate buy area. The other scenario is that Arm will form a new base.
Follow Ken Shreve on X @IBD_KShreve for more stock market analysis and insight.
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