Chip stocks helped the Nasdaq and S&P 500 climb to record highs the stock market today, while Nvidia and Apple reached the $3 trillion mark in market capitalization. Microsoft is the only other U.S. company in the $3 trillion club.
The Nasdaq composite closed 2% higher as it crossed back above the 17,000 level. The Nasdaq is also up a stout 14.5% since Jan. 1. The S&P 500 cllmbed 1.2% for its fourth-straight gain. The index lost 0.5% last week but made a bullish bounce off the 10-week moving average. The S&P 500 is up more than 12% year to date.
Certainly, Nvidia and Apple helped both index as Nvidia reached a $3 trillion market cap for the first time and Apple regained a market cap of $3 trillion for the first time since Jan. 24, according to Dow Jones Market Data.
Apple is etching the right side of a first-stage, cup-style pattern, one of at least seven key bases that can help an investor make a timely buy during a strong, confirmed market uptrend.
For now, a standard cup-without-handle entry sits at 199.62. However, Apple is also arguably actionable by rising past an aggressive entry at 196.38. From this buy point, the 5% buy zone goes up to 206.20.
VanEck Semiconductor, a popular chip-sector exchange traded fund, outperformed with a gain of more than 4% and at new highs. Meanwhile, the iShares Expanded Tech-Software ETF rallied 2% and climbed back above the long-term 200-day moving average.
The Dow Jones Industrial Average struggled to stay in positive territory. It rose less than 0.3%.
On the upside, Goldman Sachs and Microsoft produced gains of six points or more. The Magnificent Seven stock will holds its Worldwide Developers Conference at its headquarters in Cupertino, Calif., next week.
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Stock Market Today: Techs Rise On Cooling Payrolls
The ADP payroll report showed the private sector added 152,000 jobs in May, lower than the Econoday forecast of 173,000. The numbers suggested that the monetary tightening campaign during 2022 and part of 2023 is truly having an effect on cooling the economy and inflation. Meanwhile, the April 192,000 net-job increase got revised lower to 188,000.
Watch for the Labor Department's May nonfarm payrolls report on Friday before the stock market opens.
Meanwhile, on Wednesday the ISM services index jumped to 53.8 for May, well above the consensus estimate of 50.7 and April's 49.4 figure.
Beyond The Stock Market Today
Bond investors headed further into long-dated U.S. Treasurys. The benchmark 10-year government bond traded 5 basis points lower, at 4.28%.
Crude oil futures, which got slammed in recent days, rebounded nearly 1% to $73.99 a barrel. Oil's year-to-date gain has wilted to less than 4%. Natural gas surged 6.8% to $2.76 per million BTUs. Gold futures stretched early gains. Gold rose 1.2% to $2,375 per ounce, while silver jumped 1.7% and hopped back above to $30 per ounce.
Among IBD's 197 industry groups, eight groups rose 3% or higher, and the majority came from the tech sector. They included semiconductor equipment, security software, computer hardware and fabless semiconductors. Solar and alternative energy also rallied fiercely.
Among megacaps in the stock market today, most Magnificent Seven companies rallied. Alphabet rose less than 1% following a bullish test of the 21-day exponential moving average, creating an alternative buy point. The stock also formed a three-weeks-tight entry at 178.77. The Google search engine giant announced Anat Ashkenazi, a veteran in the pharmaceutical and biotech industry, as its new CFO.
Breakout In The Semiconductor Area
Meanwhile, ASML, in the chip equipment sector, staged a breakout past a trendline entry near 993. Shares surged 9%. The Dutch expert in ultrasophisticated lithography systems for chipmaking shows a solid Relative Strength Rating of 88.
ASML got some airplay in Wednesday's "IBD Live" show and is today's IBD Stock of the Day. ASML is also a new half size position in IBD Leaderboard.
CrowdStrike, a cybersecurity leader, jumped more than 11% in massive volume following an excellent fiscal Q1 report. Earnings rose 63% to 93 cents a share on a 33% jump in sales to $921 million. The stock is working on a new cup with handle.
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Smaller Stocks Still Meek
Small caps, meanwhile, joined the market advance in the stock market today. The Russell 2000 rose 1.3%, while the S&P MidCap 400 expanded its gain to around 1%.
Volume rose on the Nasdaq and the NYSE,
Also in the stock market today, SMCI, one of the hottest tech stocks over the past year, climbed 3%. Yet while trading near 797, the AI data center supplier is not at a proper buy point. Why? For starters, the stock has traded mostly below its 10-week line for at least seven weeks. Translation: It's not made much of an effort to build the right side of its new base.
A daily chart shows SMCI also still trading well beneath its 50-day line. Strong growth stocks in the stock market today do the exact opposite. They not only traverse above this key technical level but also lead them upward in slope.
The San Jose, Calif.-based firm on Tuesday introduced a ready-to-deploy liquid-cooled AI data center to help companies accelerate generative AI adoption across multiple industries.
According to IBD Stock Checkup, SMCI holds a 99 Composite Rating on a scale of one to 99. This means the large cap is superior in fundamental, technical and institutional sponsorship metrics. However, a high Composite Rating does not at all mean that it's an immediate buy.
Please follow Chung on Twitter: @saitochung and @IBD_DChung
