The Dow Jones Industrial Average closed slightly higher on Monday after dipping into negative territory just before the close. Tech stocks struggled as the Nasdaq composite led the downside. Investors are gearing up for key earnings reports from several heavyweight tech stocks this week, including Google parent Alphabet and Dow Jones component Microsoft on Tuesday.
Dow Jones Lower After Last Week's Gains
The market paused on Monday after last week's solid gains led the major indexes to reclaim support at key moving averages. But overall market direction remains up in the air as investors tread lightly, ahead of a key Federal Reserve decision on interest rates on Wednesday.
As such, trading volume was significantly lighter compared to the close on Friday, according to early data, with volume on the Nasdaq down 11% and 5% on the NYSE.
Additionally, a slew of major tech firms are expected to report earnings this week, adding to uncertainty.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 31990.00 | +90.71 | +0.28 |
| S&P 500 | (0S&P5) | 3966.72 | +5.09 | +0.13 |
| Nasdaq | (0NDQC ) | 11782.67 | -51.44 | -0.43 |
| Russell 2000 | 180.52 | +1.01 | +0.56 | |
| IBD 50 | 27.00 | +0.19 | +0.71 | |
Last Update: 4:14 PM ET 7/25/2022 |
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At the close, the Dow Jones was up 0.3% after dipping briefly into the negative. The S&P 500 was up around 0.1%. The Nasdaq led the downside with a 0.4% loss, after paring downside of over 1.0%. Small caps fared best, holding gains of 0.6% into the close.
Energy stocks led the upside among the S&P 500 sectors, while technology and consumer discretionary stocks led the downside. The broad-based SPDR energy select sector ETF gained 3.4% while WTI crude oil traded up 2.2% to around $96.80 a barrel.
Dow Jones Heavyweights Lead Big Reporting Week
This week, a handful of major tech firms are set to report earnings, including Facebook-parent Meta Platforms, Dow Jones giant Apple, Amazon and more. Both Alphabet and Microsoft are expected to report on Tuesday. Alphabet is expected to report EPS of $1.29 per share on sales of $69.87 billion. Meanwhile, analysts expect Microsoft to show EPS of $2.29 per share on revenue of $52.36 billion.
Investors always place high importance on quarterly earnings from major tech firms but this quarter is especially important. These reports should give investors a better idea of the inflation outlook — and thus, interest rate hikes — as well as how recent Covid shutdowns in China and the Ukraine war have impacted profits.
Amazon is expected to report earnings on Thursday alongside Dow Jones leader Apple.
Stocks To Watch: These Stocks Break Out
Shares of World Wrestling Entertainment broke out on Monday from a cup-with-handle base with a 68.83 buy point. The relative strength line spiked upward and hit a new high as the stock surged 8.5%. Shares are now well above their 50-day and 21-day moving averages.
The stock jumped Monday in reaction to news that CEO Vince McMahon is retiring. This came after WWE launched a misconduct investigation into the controversial founder. Additionally, the firm raised Q2 revenue guidance and received an analyst upgrade to buy at Loop Capital.
Elsewhere, McKesson scored a breakout from a 340.04 flat-base entry. The firm, which distributes specialty health care products and medical supplies, faded from the entry in afternoon trading. Even so, it closed with a 1.7% gain on strong volume. The RS line also neared a new high, according to a MarketSmith analysis.
Follow Rachel Fox on Twitter at @IBD_RFox for more Dow Jones and stock market commentary.
