Stocks ended mixed on Wednesday, but major indexes remained at or above a key support level after encouraging comments from the Fed. Nvidia slipped even though foundry partner Taiwan Semiconductor shook off effects from the Taiwan earthquake. And Tesla gained despite negative analyst views on the stock market today.
The Dow Jones Industrial Average spent much of the day in positive ground but reversed late and finished the day down 0.1%. Still, the index held its 21-day exponential moving average after dipping below the line during Wednesday's trades.
The S&P 500 gained 0.1% and rose above the 21-day line. Most of the S&P sectors gained while consumer staples and utilities lagged. Meanwhile, the Nasdaq composite led the major indexes with a 0.2% gain. The tech index also held the 21-day line after testing it on Tuesday.
The small-cap Russell 2000 rebounded with a 0.5% gain after two days of heavy selling. The Innovator IBD 50 exchange traded fund rebounded from its 50-day moving average with a 0.6% gain. And the yield on the benchmark 10-year Treasury note edged down one basis point to 4.35%.
Volume on the New York Stock Exchange was lower and higher on the Nasdaq compared with Tuesday. Breadth remained positive as advancers slightly outnumbered decliners on both exchanges.
Powell: Risks Balancing Out After 'Outside Force'
At a meeting of the Stanford Business, Government and Society Forum in California Wednesday, Federal Reserve Chairman Jerome Powell noted continued solid growth, a strong labor market and inflation moving down along a bumpy path in the economy.
Powell mentioned that risks are balancing out regarding rate cuts coming too early or too late. The recovery of the supply side after the pandemic was an atypical "outside force" that has temporarily changed the way higher interest rates usually curb demand and growth.
The Fed chief added indicators showed inflation would return to a target of 2% over time. On Monday, Powell had said February's inflation data was in line with expectations. But MarketWatch reported that Atlanta Fed President Raphael Bostic said Wednesday the Fed should wait until the fourth quarter before cutting rates.
In other economic news, the ADP employment report showed that the economy added 184,000 jobs in March, above views for 150,000, according to Econoday.
Dow Jones Stocks
Intel plunged more than 8% on the stock market today after the bellwether chipmaker said its foundry operations lost $7 billion in 2023. The company expects to break even on its operating margins "midway between now and 2030."
Among other tech stocks in the Dow, Microsoft is getting support at its 21-day moving average, according to IBD MarketSurge chart analysis tools. Microsoft stock is on the IBD Long Term Leaders list.
Salesforce rebounded from its 50-day moving average and appears to be building a base with a buy point of 318.71. Further, Caterpillar and IBM were among the biggest gainers in the index.
Apple rose 0.5% but its 50-day moving average has fallen below the 200-day line. Also Disney fell more than 3% despite the company's executives winning a boardroom battle with activist investor Nelson Peltz.
Why This Market Is So Dangerous; Time To Sell ELF Beauty?
Stocks Market Today: Tesla Reverses Higher
Tesla reversed and rose 1.1% despite a negative report from Deutsche Bank analyst Emmanuel Rosner. The analyst observed that slowing demand could be compounding the electric-car maker's high inventory problem.
Meanwhile, Nvidia switched directions and ended the day down 0.6%. Nvidia's key contract manufacturer is Taiwan Semiconductor, which had to halt some work following a powerful earthquake in Taiwan early today. But shares of Taiwan Semi ended the day up 1.3%. Nvidia, a Magnificent Seven stock, is a holding on IBD Leaderboard and the IBD 50.
Among earnings movers, game arcade and restaurant operator Dave & Buster's has gapped up and broken out from a three-weeks-tight base with a buy point of 64.90. Fourth-quarter sales grew 6% while earnings were 21% higher from the year-ago period.
Cal-Maine gapped up after getting support around the 10-week moving average. It is extended from a cup-with-handle entry of 57.95.
Warren Buffett holding Ally Financial got a downgrade from JPMorgan to underweight. Finally, IBD 50 stock ELF Beauty triggered a sell signal by falling below the 50-day moving average in heavy volume on the stock market today.
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