Dow Jones Reverses Lower On Weak Data; Oil Prices Rally On Surprise Production Cut

The Dow Jones Industrial Average reversed lower Tuesday morning after the release of key economic data, as U.S oil prices rose after a surprise OPEC+ production cut.




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IBD 50 stock Shockwave Medical (SWAV) dropped more than 6% after an Oppenheimer downgrade. Electric-vehicle leader Tesla (TSLA) rose almost 1% Tuesday. Among the Dow Jones industrials, tech titans Apple (AAPL) and Microsoft (MSFT) were both higher after today’s stock market open.

In the market’s current volatility, Arista Networks (ANET), Costco (COST) and Ulta Beauty (ULTA) — as well as Dow Jones stock Chevron (CVX) — are among the top issues to buy and watch. Keep in mind the market’s increased volatility is a good reason for investors to be more defensive.

Costco is an IBD Leaderboard stock in the wake of a recent breakout, while Chevron and Ulta Beauty were featured in last week’s Stocks Near A Buy Zone column.

Dow Jones Today: Treasury Yields, Oil Prices, Key Data

After the opening bell Tuesday, the Dow Jones Industrial Average turned down 0.7%, while the S&P 500 fell 0.8%. And the tech-heavy Nasdaq composite lost 1.1% in morning trade.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.4% and the SPDR S&P 500 ETF (SPY) moved down 0.2% in early trade.

The 10-year Treasury yield ticked higher to 3.28% early Tuesday, recovering from Friday’s losses. Last week, the 10-year Treasury yield notched its highest closing level since June 21.

U.S. oil prices slashed gains Tuesday, threatening to add to last week’s sharp losses. West Texas Intermediate futures rallied 4% Monday morning after OPEC+ — which includes the Organization of the Petroleum Exporting Countries and key allies such as Russia —  agreed to cut production quotas by 100,000 barrels per day, starting in October. But WTI futures erased early gains, trading back around $87 a barrel.

Early Tuesday, the U.S. Services Purchasing Managers’ Index, known as Services PMI, measured 43.7, below Econoday estimates that called for a 44.1 reading. It was its lowest reading since May 2020. August survey data signaled a sharp decline in business activity across the U.S. service sector.

Next, the Institute For Supply Management services index reading measured 56.9, topping the 55.4 estimate.


Nasdaq Extends Losing Streak; iPhone 14 On Call


Stock Market Rally Under Pressure

The stock market ended lower Friday, with the Nasdaq composite once again the worst performer out of the major indexes. It extended its losing streak to six sessions as it fell 1.3%.

Friday’s The Big Picture column commented, “The S&P 500 ended near session lows as it skidded 1.1%. It was turned away at its 50-day line following an early pop. It has now fallen in five of the past six trading days.”

If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one key to the investment guidelines. IBD offers a broad range of growth stock lists, such as Leaderboard and SwingTrader.

Investors also can create watchlists, find companies nearing a buy point, or develop custom screens at IBD MarketSmith.


Five Dow Jones Stocks To Watch Now


Dow Jones Stocks To Watch: Chevron

Dow Jones stock Chevron rallied 1.5% Friday, snapping a three-day losing streak. Shares continue to build a cup base with a 182.50 buy point — according to IBD MarketSmith chart analysis — amid a strong performance by energy stocks so far this year. An early entry at 164.76 is also in play. The stock rose 1.2% early Tuesday, as oil prices moved higher.

CVX stock shows a strong 97 out of a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. Investors can use the IBD Composite Rating to easily gauge the quality of a stock’s fundamental and technical metrics.


4 Top Growth Stocks To Buy And Watch In The Current Stock Market Rally


Top Stocks To Watch: Arista, Costco, Ulta

Arista Networks has added a handle to a double-bottom base, placing the correct entry at 132.97, according to IBD MarketSmith chart analysis. Arista’s relative strength line is starting to give ground, as the stock falls below its long-term 200-day line. ANET shares were up 0.9% early Tuesday.

IBD Leaderboard stock Costco gave up much-needed support at its 50-day line Friday and is falling further below its 552.81 buy point from a cup with handle. The stock is close to triggering the 7%-8% loss-cutting sell rule. Shares traded up 0.6% Tuesday.

Cosmetics retailer Ulta Beauty remains modestly above a 417.08 buy point in a double bottom base following Friday’s 0.3% drop. ULTA shares were up 0.5% Tuesday morning.


Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live


Tesla Stock

Tesla stock skidded 2.5% Friday, closing right at its 50-day line, which is a potential support level to watch. Shares of the electric-vehicle giant gained almost 1% Tuesday morning, as Wolfe Research upgraded the stock from peer perform to outperform, with a 360 price target.

Tesla stock found resistance at its 200-day line in recent months and is about 35% off its 52-week high.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares declined 1.4% Friday, closing below support at their 50-day line. The stock is about 12% away from a buy point at 176.25 off a cup with handle. Despite the recent losses, the stock’s relative strength line is holding near new highs, indicating steady stock market outperformance. Shares rose 0.65% Tuesday morning.

Microsoft fell 1.7% Friday, extending a losing streak to six sessions and falling further below its 50-day line. Shares remain sharply below their long-term 200-day line and about 27% off their 52-week high. The stock gained 0.4% early Tuesday.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.

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Dow Jones Reverses After Economic Data; Oil Prices Climb On Surprise Production Cut