The Dow Jones Industrial Average rebounded into positive territory after key Fed official James Bullard spoke out. AMC Entertainment rocketed higher as it recouped some of the losses caused by an APE settlement. Costco Wholesale skidded on sales data. Microsoft and Apple rose.
While there were few breakouts, a trio of noteworthy stocks near buy points moved higher. O'Reilly Automotive, Vertex Pharmaceuticals and Manhattan Associates all look solid.
Fed Official Bullard Speaks; Jobs Report Looms
Markets seemed to welcome comments from St. Louis Federal Reserve President James Bullard Thursday.
Bullard cooled fears over a looming credit crunch during a speech in Little Rock, Ark.
"Only about 20% of lending is going through the banking system and only a fraction of the banks are small or regional banks," he said. "I just don't think it is big enough by itself to send the U.S. economy into recession."
Meanwhile, initial unemployment claims came in at 228,000, well above economists expectations for 201,000. In addition, the previous week's level was revised up by 48,000, from 198,000 to 246,000.
This comes after ADP data earlier this week showed the expansion in private payrolls was far lower than expected in March. Moreover, a report from Challenger, Gray & Christmas said layoffs are up 396% so far in 2023 compared to the same period last year.
The Good Friday jobs report now looms, though the stock market will be closed for the day, preventing any knee-jerk reaction.
Nasdaq, Small Caps Reverse Higher
The Nasdaq had the best day among the major indexes, reversing higher as it closed up 0.8%. If fell for the week though. Google parent Alphabet starred here with a gain of 3.8%.
The benchmark S&P 500 turned in a more modest 0.4% gain, as well as a nominal weekly loss. First Republic Bank stood out, rising 4.4%.
The S&P 500 sectors closed mostly higher. Communication services and utilities were the strongest areas while energy lagged.
Small caps reversed higher, though the Russell 2000 only gained 0.1%. Growth stocks lagged, with the Innovator IBD 50 ETF dipping 0.5%.
Dow Jones Today: Microsoft Stock, Apple Shine
The Dow Jones fought its way out of the red to close marginally higher.
Microsoft stock fared best on the much-watched index, rising 2.6%.
MSFT is trading near the top of a buy zone from a 276.86 flat base entry, MarketSmith analysis shows.
Apple stock was another solid performer as it gained 0.6%. It is well above its moving averages.
Caterpillar lagged the most as it dipped 2%. Salesforce also underperformed, dropping 1.4%.
AMC Stock Goes APE
AMC stock had a remarkable session. It ended the session with a gain of 21.4%.
The cinema stock failed in its attempt to erase its losses for the week though, losing just over 2%.
It was hammered earlier in the week after it announced a settlement with some of its shareholders.
The lawsuit settlement paved the way for the firm to convert APE preferred equity units into common stock.
It could also allow the firm to raise more capital. According to B. Riley Securities analyst Eric Wold, AMC could raise as much as $16 billion in equity.
AMC shares soared Thursday while AMC's preferred equity units (APE) tumbled after Delaware's Court of Chancery ruled Wednesday night against fast tracking a proposed settlement with shareholders that would allow a capital raise for the theater chain and meme stock
Costco Stock Falls After Sales Update
COST stock had a tough session after it reported its first monthly same-store sales drop in nearly three years.
The big box discount giant said global same-store sales fell 1.1% in March. It was the first time sales had fallen in this category since April 2020.
Costco said U.S. same-store sales fell 1.5% in March, and there was a 2.4% decrease in Canada. Internationally, those sales rose 2%. E-commerce comparable sales slid 12.7%.
Costco stock fell 2.2%, though it moved off session lows.
Nevertheless, it lost ground on the 50-day and 200-day moving averages. It has a long way to go before it reaches a consolidation pattern entry of 564.85.
Futures: Jobs Report Looms; Tesla Cuts EV Prices Again
Outside Dow Jones: 3 Stocks Eye Entries
A few noteworthy stocks are getting closer to buy points.
O'Reilly Automotive was moving higher as it tries to reach a cup base entry of 874.04.
The auto parts play could soon form a handle. All-around strong performance is reflected in an IBD Composite Rating of 95.
Vertex Pharmaceuticals is close to reaching a first-stage cup pattern buy point of 325.29.
Earnings are very strong here, with the stock boasting an EPS Rating of 96.
Manhattan Associates has also formed a cup base. It is shooting for a 158.71 buy point.
Enterprise software play MANH is in the top 9% of stocks in terms of price performance over the past 12 months.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more analysis of growth stocks.
