The Dow Jones Industrial Average fought its way off lows but the Nasdaq cratered as jobless claims fell. Former leader Nvidia was smashed lower on China news, with AMD also getting hit. Bed Bath & Beyond stock dived amid analyst doubts, with fellow meme stocks AMC Entertainment and GameStop also plunging. Coinbase slipped as Bitcoin fell.
A few stocks managed to flex their muscles despite the torrid action. Meridian Bioscience and AES both showed strength near entries.
Volume was up on the Nasdaq vs. the same time on Wednesday, a bad sign for growth stock investors.
The yield on the benchmark 10-year Treasury note spiked 13 basis points to 3.26%. West Texas Intermediate crude oil fell nearly 4% amid rising recession fears, trading at just over $86 per barrel.
Dow Jones and other indexes were not helped by new jobs data, which showed initial jobless claims fell by 5,000 to 232,000 for the week ended Aug. 27. This was far under the Econoday consensus of a rise in jobless claims to 246,000. The shortfall indicates continued strength in the labor market, fueling concerns the Fed will increase rates this month.
"U.S. stocks are declining after another round of strong labor and manufacturing data confirm the Fed's hawkish stance, that they can remain aggressive with the tightening of policy," Oanda senior market analyst Edward Moya said in a note to clients.
Nasdaq Dives As IBD 50 Falls
The Nasdaq was getting hit the hardest out of the major indexes even as it moved off lows. It fell about 1%. Okta was a major laggard as it fell more than 30%.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 31529.26 | +18.83 | +0.06 |
| S&P 500 | (0S&P5) | 3944.46 | -10.54 | -0.27 |
| Nasdaq | (0NDQC ) | 11695.84 | -120.36 | -1.02 |
| Russell 2000 | 180.52 | -2.98 | -1.62 | |
| IBD 50 | 27.38 | -0.90 | -3.18 | |
Last Update: 3:00 PM ET 9/1/2022 |
||||
The S&P 500 powered off lows, but remained down 0.3%. Monolithic Power Systems struggled here as it dipped nearly 7%.
S&P 500 sectors were mixed, with utilities and health faring best. Materials and energy were the worst laggards.
Bears were also feasting on small-cap investors, with the Russell 2000 down 1.6%.
The Innovator IBD 50 ETF, a bellwether for growth stocks, was doing particularly badly. It plunged more than 3% after being down more than 4% earlier today.
Dow Jones Today: Boeing Stock Stalls
The Dow Jones Industrial Average was faring best out of the major indexes. It fought its way off lows and tried to turn positive.
Boeing was the worst performer on the Dow Jones today. It slammed below its 50-day moving average as it plunged nearly 5%.
Merck and Johnson & Johnson fared best as both rose about 2%.
Nvidia Stock Hit Amid China Restrictions
Nvidia's stock was trying to fight back but remained down nearly 9% in a high-volume move.
It gapped down and lost more ground on the 50-day moving average. The former leader has now shed more than half its value so far this year. This latest drop comes after the company revealed the U.S. government is restricting the sale of some of its chips to China.
Fellow chip stock Advanced Micro Devices was also suffering after it emerged it also was told to stop selling artificial intelligence chips to China.
Among other chip stocks, Micron Technology reversed higher to post a slight gain. Broadcom remained down nearly 2% despite moving off lows, and Qualcomm skidded more than 2%.
BBBY Stock Battered Amid Analyst Doubts
Meme stock Bed Bath & Beyond continued to hemorrhage. It's trading near lows for the day after falling almost 7%, though volume was lighter.
BBBY stock was walloped this time on analyst doubts over the retailer's turnaround plan.
The company has revealed ongoing moves to shore up its finances that include commitments for more than $500 million in new debt. The stock was punished after the firm filed to sell additional shares in the future.
It got a shellacking earlier this month after GameStop Chairman Ryan Cohen's RC Ventures sold all its stock in the company. Bed Bath & Beyond stock has already flashed multiple sell signals and fell further below its downward-sloping 200-day moving average.
AMC stock was down nearly 8% while GameStop, the original meme stock, fell over 3%.
Coinbase Stock, RIOT Flogged As Bitcoin Falls
Coinbase was trying to move off lows for the day but remained down almost 3%.
The stock, which slashed its full-year forecast last month, has now knifed below the 50-day line. COIN shares are down more than 74% since the start of 2022.
Bitcoin was struggling, falling below the psychologically important $20,000 mark as it slid about 1% in the past 24 hours, according to CoinDesk.
Other cryptocurrency plays also fell sharply. The Grayscale Bitcoin Trust fell over 2% while Bitcoin mining play Riot Blockchain plunged more than 6%.
Market Rally Gets Reprieve; What To Look For In Friday's Jobs Report
Outside The Dow Jones: These Plays Flex Near Entries
It is important that investors continue to work on their watchlists even as markets toil. Here are a couple of candidates showing impressive relative strength.
Utility play AES formed a cup base. It is shooting for a buy point of 26.62 according to MarketSmith analysis.
AES flashed a bullish sign as its relative strength line hit a new high. It is in the top 8% of stocks in terms of price performance over the past 12 months. Earnings are not ideal, with its EPS Rating sitting at 73 out of 99. It offers an annualized dividend yield of 2.5%. This beats the S&P 500's average.
Meridian Bioscience has formed a cup with handle base with an entry of 33.27. The RS line is rising here, even as it forms its handle. All-around performance is strong, with its IBD Composite Rating coming in at 90.
Big Money has been buying up the stock of late. This is reflected in its Accumulation/Distribution Rating of B, on an A+ to E scale.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more analysis of growth stocks.
