The Dow Jones Industrial Average pared back gains to trade 0.7% higher at noon, after surging nearly 600 points in early trading.
The S&P 500, which matched the Dow's early advance, also gave up the bulk of its gains to trade 0.7% higher. The Nasdaq rose over 2% in early trading but pared back to a 0.6% gain.
Volume on the NYSE and on the Nasdaq was higher compared to noon on Monday.
Crude oil fell to $82.50 per barrel.
The yield on the benchmark 10-year Treasury note climbed back above 4%. The small-cap Russell 2000 gave up half of its early gains to trade 1% higher. And the Innovator IBD 50 ticked 0.5% higher.
Stocks Moving Today
Energy stocks are setting up potential buy points.
ConocoPhilips has been in a buy zone with a buy point of 115.57. Dow Jones component Exxon Mobil is in a flat base and nearing a buy point of 105.67.
Among IBD 50 stocks, Murphy USA is nearing a buy point of 303.19 in a flat base. It is testing its 50-day moving average.
EOG Resources is in a cup-with-handle base that shows a buy point of 130.41. Devon Energy is also in a cup-with-handle base with a 75.37 entry.
Warren Buffett stake and Tesla rival BYD is surging nearly 3% after preliminary estimates forecast a whopping $764.5 to $820 million in Q3 sales.
The 300%+ increase over last year will likely offset soaring production costs while profits for the Chinese EV maker are expected to quadruple.
Shares of Tesla are up 1% ahead of earnings on Wednesday.
Industrial output increased 0.4% in September. Manufacturing and mining rose while utilities fell.
Capacity utilization of 80.3 showed the economy was in full steam, lifting 0.7 above its long-term average since 1972. The motor vehicle assembly rate was slightly higher at 10.65 million from August's 10.64 million, and the highest since November 2020. The combined 2018 and 2019 average was 11.11 million.
According to Bill Adams, Coamerica's Chief Economist, increases in manufacturing and capacity utilization support monetary tightening. On the other hand, the NAHB Housing index fell to its lowest point since 2012, excluding the Covid-impacted months.
Jeffrey Roach, Chief economist at LPL Financial, sees more downside in the housing market as interest rates climb.
Dow Jones Megacaps Release Q3 Reports
Dow Jones leader Goldman Sachs is up more than 4% after strong earnings. Bond trading income jumped 41% from last year, driving $11.98 billion in revenue and earnings of $8.25 per share. Stock trading and investment banking revenue declined. GS shares are approaching their 50-day moving line.
Johnson & Johnson beat views with revenue of $23.8 million and earnings of $2.55 per share. The Dow Jones stock is paring gains after lowering its full-year outlook, due to slowing demand for Covid vaccines.
Netflix earnings are on tap after Tuesday's closing bell. The stock is trading higher and approaching a buy point of 252.09 in a long consolidation.
Target shares have risen over 5% after Jefferies analyst Corey Tarlowe upgraded it to a buy from hold with a $185 price target. Shares are approaching their 50-day line.
Cryptocurrencies
Bitcoin took 85 minutes to mine a block on Monday, leaving 13,000 transactions in limbo with a pending status. The usual time to mine a block is 10 minutes.
Mining difficulty has reached an all time high despite the crypto bear market. The leading cryptocurrency is trading below $20,000 but is off recent lows that undercut the $18,500 level.
Follow Vidya Ramakrishnan on Twitter @IBD_Vidya
