The stock market reversed higher Monday morning. Indexes opened lower on a new warning in the retail sector but losses evaporated about an hour into the session.
The Nasdaq composite climbed 0.7%. Early on Tuesday it dipped below the 21-day exponential moving average, but at 11 a.m. ET was back above it. The line had been offering the Nasdaq and other major indexes support, so it's an important level to watch.
The S&P 500 went from a loss of more than 0.5% to a gain of 0.4%. The Dow Jones Industrial Average climbed 0.2%. Both indexes are trying to hold to their 21-day lines.
Volume fell on the NYSE and Nasdaq compared with the same time on Monday.
This morning's reversal comes after the stock market faded Monday, although it closed higher. The week's action so far reflects the market's volatility.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 32974.67 | +58.89 | +0.18 |
| S&P 500 | (0S&P5) | 4137.07 | +15.64 | +0.38 |
| Nasdaq | (0NDQC ) | 12142.57 | +81.20 | +0.67 |
| Russell 2000 | 189.62 | +1.75 | +0.93 | |
| IBD 50 | 33.72 | +0.59 | +1.78 | |
Last Update: 10:56 AM ET 6/7/2022 |
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The Reserve Bank of Australia lifted its key policy interest rate by 0.5 percentage point, which was more than expected. The news contributed to a drop in many world markets. But U.S. Treasury yields fell 5 basis points to 2.99%.
Target Shakes Retail Sector
Target tumbled more than 8% at the open but pared its loss to 2%. The retailer warned of shrinking profits because it is overstocked with unwanted merchandise that will force it to cancel orders with its vendors for more merchandise, or offer bigger discounts to customers. At the same time, it also plans price hikes on other merchandise due to rising costs.
The forecast reflects a mismatch between supply in stores and shifting demand among consumers. Walmart fell in sympathy, down 2.4%. SPDR S&P Retail ETF fell 2.2%, extending a downward trend.
Target's warning comes nearly three weeks after the retailer missed earnings estimates due to inventory problems and higher costs.
But J.M. Smucker climbed more than 3% in heavy trading. The food, beverages and pet food company beat April-quarter expectations, but warned that a voluntary recall of Jif peanut butter will impact full-year earnings. The stock is rebounding after snapping a four-day losing streak Monday.
IBD 50 Outperforms Stock Market
The Innovator IBD 50 ETF outperformed the stock market with a 0.5% increase. Arch Resources led the IBD 50 with a 7.6% jump to almost a new high. Jefferies upgraded the coal stock to buy from hold and lifted the price target to 225 from 160.
Jefferies also upgraded other coal stocks, including Warrior Met Coal and Peabody Energy. Both rose sharply and are forming the right side of bases.
Darling Ingredients rose above the 85.02 buy point of a cup-with-handle base, but volume is light and the price gain is unconvincing so far.
