Futures ahead of key inflation report

The Dow Jones Industrial Average reversed from early losses on Wednesday after a hotter than expected inflation report – the consumer price index. Energy stocks rallied as oil prices rebounded after a two-session decline. Former stock market leaders Coinbase, Roblox, Trade Desk and Unity Software all fell after reporting their quarterly results.


Coinbase (PIECE OF MONEY), western oil (OXY), Roblox (RBLX), Commercial counter (TTD) and Unity Software (U) announced its earnings results on Tuesday evening. Meanwhile, Wendy’s (WEN) and Yeti (YETI) announced its results on Wednesday morning.

COIN shares plunged 27% while Occidental gained 1.4%. Roblox was up 3% while Trade Desk was down 4%. Unity plunged 36% while Wendy’s fell more than 8%. And Yeti was up about 3%.

Electric vehicle giant You’re here (TSLA) erased early losses on Wednesday morning. Dow Jones Leaders Apple (AAPL) and Microsoft (MSFT) were both down around 1% in the current stock market.

As the stock market correction appears to be bottoming out, Dow Jones leaders Chevron (CLC) and Merck (MRK) — with Energy Cheniere (LNG), Exxon Mobil (XOM) and Northrop Grumman (NOC) – are among the top IBD stocks to watch on Wednesday.

Cheniere Energy, Microsoft and Tesla are IBD ranking stocks. Exxon and Merck were featured in this week’s Stocks Near A Buy Zone column.

Dow Jones Today: Treasury Yields, Oil Prices, CPI

After Wednesday’s open, the Dow Jones Industrial Average rose 0.7%, while the S&P 500 rose 0.8%. The Nasdaq also reversed its 0.6% rise in morning trading.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) rose 0.6%. The SPDR S&P 500 ETF (SPY) gained 0.8%.

The 10-year Treasury yield jumped to 3.01% on Wednesday morning after closing Tuesday just below 3%. On Monday, the 10-year Treasury yield hit its highest level since November 2018. Meanwhile, US oil prices rose 4%, with Texas Intermediate crude hovering around $104 a barrel.

Consumer prices rose 0.3% in April, beating Econoday’s estimate for a 0.2% increase. Meanwhile, inflation rose 8.3% in April from a year ago, warmer than the 8.2% estimate.

The stock market correction deepens

On Tuesday, the Nasdaq composite rose 1%, recovering less than a quarter of Monday’s 4.3% drop. The S&P 500 rose slightly, while the Dow Jones Industrialists fell slightly. The Nasdaq and S&P 500 are each heading for their sixth straight weekly decline. The Dow Industrials index is in opposition for its seventh week of decline.

Tuesday’s The Big Picture column commented: “Add these factors to the reality that pure growth stocks are far from suitable buy points, and the regular reader of this column can conclude that sitting on a big wad of cash is still a smart move.”

If you are new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one of the keys to investing guidelines. IBD offers a wide range of growth stock listings, such as Leaderboard and SwingTrader.

Investors can also create watchlists, find companies close to a buy point, or develop custom screens at IBD MarketSmith.

Five Dow Jones stocks to watch now

Dow Jones stocks to watch: Chevron, Merck

Dow Jones leader and energy giant Chevron is in a flat basis that has a buy point of 174.86, according to IBD MarketSmith’s chart analysis. CVX shares rose 1% on Tuesday, but are still caught below resistance at their 50-day line. Chevron shares gained 1.8% on Wednesday morning.

CVX stock boasts a perfect composite rating of 99 IBD, per IBD stock check. Investors can use the IBD Composite Rating to easily assess the quality of a stock’s fundamental and technical metrics.

Drug leader Merck is just below a cup with the buy point of 89.58 after a brief breakout attempt last week. Shares rose 0.1% on Wednesday morning.

On the positive side of the stock, its relative strength line is making new highs, indicating strong stock market outperformance during the current stock market correction.

Three growth stocks to watch in the currentrent Stock market correction

Stocks to watch: Cheniere, Exxon

IBD Leaderboard Cheniere Energy stock is one of the top stocks to watch despite losing another 2.4% on Tuesday. Shares are falling further below their 50-day line, even as they continue to etch a flat base that shows a buy point of 149.52, according to IBD MarketSmith’s chart analysis. LNG shares rose 0.2% on Wednesday.

Energy giant Exxon Mobil broke above the 89.90 buying point of a tumbler with handle last week. But the shares gave up the entry and are about 5% below the buy point. This stops before triggering the auto-sell rule. But the shaky breakout illustrates the danger of owning stocks in the current market environment. Shares of XOM rose 1.9% on Wednesday.

Defense contractor Northrop Grumman continues to burn a handle cup with a buy point of 477.36. Stocks are just below their 50-day line after Tuesday’s 0.9% loss. Northrop shares edged higher on Wednesday.

Join IBD experts as they analyze the top stocks of the current market correction on IBD Live

Tesla Stock

Tesla stock erased early losses Wednesday morning, still looking to add to Tuesday’s 1.6% gain. Stocks remain significantly below their 50- and 200-day lines amid their recent weakness.

The stock traded as high as 1,243.49 on Nov. 4 and is about 36% off that all-time high.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares rebounded 1.6% on Tuesday, but remain below their 200-day line. Apple stock fell 0.7% on Wednesday.

Software leader Microsoft gained nearly 2% on Tuesday, ending a three-day losing streak. The stock closed around 24% off its 52-week high. MSFT shares fell 0.8% on Wednesday morning.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen to learn more about growth stocks and the Dow Jones Industrial Average.


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