Dow Jones falls ahead of Fed rate hike decision, Powell comments; Tesla ramps up production in China
The Dow Jones Industrial Average briefly fell more than 225 points on Wednesday ahead of the Federal Reserve’s decision to raise interest rates, due in the afternoon. A social media company A click (I click) plunged as much as 13% after that not meeting revenue projections. And Tesla (TSLA) the stock turned lower even after Reuters reported The electric vehicle giant plans to increase production at its Shanghai plant due to rising demand.
The Two-day Fed policy meeting concludes on Wednesday with an interest rate decision at 2:00 PM ET, followed by comments from Fed Chairman Jerome Powell. The Fed is widely expected to raise the federal funds rate by 25 basis points to a range of 4.50% to 4.75%. Another quarter-point increase is expected in March, which would bring the Fed rate very close to the Fed’s final rate of 5% to 5.25%. This is where the Fed thinks it can stop raising interest rates to allow previous increases to work their way through the economy.
ADP released its employment report on Wednesday and showed payrolls for January were 106,000, below expectations of 158,000 and down from 235,000 in the previous month. The ADP report is a precursor to Friday’s jobs report from the Labor Department.
Key revenue drivers: AMD, Amgen
Advanced Micro Devices (AMD) rose 6% after the company beat its targets for the fourth quarter late on Tuesday, while guiding lower guidance for its sales in the current quarter. The pharmaceutical giant Dow Jones Amgen (AMGN) fell 2.3% after its mixed fourth quarter earnings report.
early wednesday Peloton Interactive (PTON) jumped 10% following fiscal second-quarter results.
Meta platforms (META) will report after the market closes, while Amazon (AMZN), An apple (AAPL), Alphabet (GOOGLE) are scheduled for late Thursday.
Stock market today
Electric vehicle leader Tesla was down 1.1% on Wednesday morning. Dow Jones tech giants Apple and Microsoft (MSFT) were mixed afterwards today’s stock market open.
IBD ranking availability imp (PI), Etsy (ETSY) and Wingstop (WING) — as well as Dow Jones stocks JPMorgan Chase (JPM) — are among the best stocks to buy and watch, with the continued strength of the market rally.
It’s Impinj IBD ranking availability. Etsy it was recent IBD Stock of the Day. Impinj and Wingstop were included this week the Stocks column near a buy zone.
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Dow Jones Today: Oil Prices, Treasury Yields
After Wednesday’s open, the Dow Jones Industrial Average fell 0.4% and the S&P 500 was down 0.1%. The tech Nasdaq composite rose, supported by a rally in AMD shares.
Among us exchange traded fundsthe Nasdaq 100 tracker Invesco QQQ Trust (QQQ) traded down 0.3%, and the SPDR S&P 500 ETF (A SPY) was down 0.4% early Wednesday.
The yield on 10-year US Treasuries fell to 3.46% on Wednesday morning ahead of today’s Fed decision. The 10-year yield continues to trade below its 50-day line and just above its recent lows.
Oil prices rose after modest gains on Tuesday. West Texas Intermediate futures gained less than 1% in morning trade, bouncing between $79 and $80 a barrel as investors await Wednesday OPEC Production Decision.
Stock market rallies
On Tuesday, the Dow Jones Industrial Average rose 1.1% and the S&P 500 rose 1.5%. The tech-heavy Nasdaq Composite advanced 1.7%.
The Big Picture column on Tuesday commented, “Distribution days have been virtually non-existent since January 6th. The S&P 500 currently shows three, but only one felt like a significant institutional selloff. That was on January 18, when the index fell 1.6% on higher volume. The big picture on Friday increased its invested percentage to a range of 60% to 80% as the Nasdaq jumped above its 200-day line.”
Now is an important time to read IBD’s The Big Picture column amid the ongoing stock market rally.
Five Dow Jones Stocks to Buy and Watch Now
Dow Jones stocks to buy and watch: JPMorgan
Banking giant JPMorgan is in a 5% buy range above a 138.76 flat buy base after a 0.6% gain on Tuesday. The 5% buy zone tops out at 145.70. Shares of JPM were trading down 0.9% early Wednesday.
JPM shares showing a solid 94 out of a perfect 99 IBD Composite Ratingaccording to IBD Stock Check. The Composite Rating is designed to help investors easily find the highest growth stocks.
4 Biggest Growth Stocks to Buy and Watch Stock market rallies
Top stocks to buy and watch: Impinj, Etsy, Wingstop
Stocks in the IBD Ranking Impinj ended Tuesday back above 129.12 points in a buy base after its recent breakout, as shares rose 3.9% on Tuesday. The 5% buy zone rises to 135.58. PI shares rose 1.7% on Wednesday.
Background: Impinj’s expertise lies in RF semiconductors for identifying, locating and authenticating items. While it lost money in 2020, the company earned 25 cents per share in 2021. And annual earnings are expected to grow 284% to 96 cents per share this year.
Etsy is back above 137.01 buy points in a handle cup after rising 2.1% on Tuesday. With the stock pulling back, the 5% buy zone rises to 143.86. Shares of Etsy were down 0.3% Wednesday morning.
Background: The company is a provider of an online e-commerce platform where creators of arts and crafts, vintage items and other unique goods go to sell their products. It has a unique business model that has evolved over the past few years from a niche e-commerce market to a preferred shopping destination across multiple categories.
Wingstop is quickly approaching a 170.97 buy point in a distorted base with a 1.2% gain on Tuesday. Watch for a potential handle to offer a lower entry. Shares of WING were down 0.3% early Wednesday.
Background: The Dallas-based restaurant chain has more than 1,900 locations in the U.S. and international markets, according to Dow Jones Newswires. Her international locations include Mexico, Colombia, Panama, Singapore and the United Kingdom. The company added a net 40 stores in the prior quarter. Earnings are due on February 22.
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Stocks to Buy and Watch in the Stock Market Rally
These are seven of the best stocks to buy and watch in today’s stock market, including two Dow Jones leaders.
|Company name||Symbol||Right point of purchase||Type of foundation|
|A monster||(MNST)||104.75||Flat base|
|Axon||(AXON)||189.72||Mug with a handle|
|Etsy||(ETSY)||137.01||Mug with a handle|
Source: IBD data as of February 1, 2023
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Tesla shares rose 3.9% on Tuesday, recovering from Monday’s decline. Despite their strong recovery since January 6, shares are still below the 200-day line. And Tesla shares closed about 57% off their 52-week high on Tuesday.
Shares looked to add to Tuesday’s gains, but turned 1.1% lower on Wednesday. According to ReutersThe electric vehicle giant plans to ramp up production at its Shanghai plant in the next two months to meet rising demand due to recent price cuts.
Dow Jones Leaders: Apple, Microsoft
Between Dow Jones Stocks, Apple shares rose 0.9% on Tuesday, recovering some of Monday’s 2% selloff. The stock is still holding above its 50-day line after strong gains in recent sessions. The stock remains about 20% off its 52-week high. Apple will report its quarterly earnings late Thursday. Shares of AAPL were down 0.6% on Wednesday.
Shares of Microsoft rose 2.1% on Tuesday, bouncing off support at its 50-day line, which it regained last week. Shares remain 22% below their 52-week high. MSFT traded a fraction higher on Wednesday.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.
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