The Dow Jones Industrial Average reversed lower on Tuesday, after an early dose of economic data kicked off the short and final trading week of the year. China-based stocks rallied as that country eased Covid restrictions. Tesla stock fell nearly 5% after that Reuters reported The electric car giant plans to run a reduced production schedule at its Shanghai plant in January.
Tuesday’s economic data includes two housing reports, with the Case-Shiller Home Price Index and the FHFA Home Price Index – both at 9 a.m. ET – along with the Dallas Fed Manufacturing Survey at 10:30 a.m. ET.
The Case-Shiller Home Price Index for October came in better than estimates, but still fell 0.5% after a September drop of 1.2%, and an annual increase of 8.6%. Meanwhile, the FHFA Home Price Index was flat for the month of October, up 9.8% year-over-year.
Finally, the Dallas Fed Manufacturing Survey is expected to print -11.0 in December versus -14.4 in the previous month.
On the earnings front, the schedule is clear from this week heading into the last week of 2022, with Cal Maine Foods (calm) The only reporter on Wednesday after closing.
Southwest Airlines (luv) fell more than 4% after Canceled company More than two-thirds of its flights are on Mondays, with plans to reduce its schedules on Tuesdays and Wednesdays due to winter storms during the holiday.
midpiece (MEDP), IBD Leaderboard stock Neurobiological Sciences (nbix), O’Reilly Auto Parts (Orly) And the Texas Roadhouse (TXRH) – as well as the names of the Dow Jones Amgen (AMGN) And the Larva (Cat) – among the top stocks to consider on investor watchlists. Keep in mind that recent market weakness should keep investors on the defensive.
Dow jones today: oil prices and treasury yields
After the opening bell on Tuesday, the Dow Jones Industrial Average fell 0.1%, while the S&P 500 lost 0.3%. The tech-heavy Nasdaq Composite fell 0.6% in the morning move, with Tesla firmly lower and China issuing names. Trip.com (TCOM), binduodu (PDD) And the JD.com (Dinar) recorded strong gains.
Chinese authorities said the country will end the mandatory quarantine requirement for inbound travelers starting January 8. Restrictions on passenger numbers and international flights will also be lifted. The latest step in China’s easing of strict Covid restrictions comes even as infections were reported to be spreading rapidly across the country.
China-based solar manufacturers posted some of the strongest early moves, with Genco Solar (JKS) And the Daco New Energy (Knock) each in excess of 4%. Among the ETFs, KraneShares CSI China Internet (KWEB) jumped 2.3%. iShares MSCI China (MCHI) added 2.2%.
The 10-year Treasury yield rose to 3.82% Tuesday morning, with the 10-year yield rising after last week’s strong gains. Meanwhile, US oil prices rose less than 1% on Tuesday, with West Texas Intermediate crude futures trading above $80 a barrel in morning trade.
The stock market is under pressure
On Friday, the Dow Jones Industrial Average rose 0.5% and the Standard & Poor’s advanced 0.6%. The heavy Nasdaq Composite climbed just 0.2%.
Friday’s Big Picture column He commented: “The Nasdaq Composite also fought back from negative territory, although its gains were a miserable 0.2%. The tech-heavy index was down 1.9% for the week, still more work to do to break its downtrend. Worse than the S&P 500 This year, he’s given up nearly 34%.”
Now is an important time to read IBD’s The Big Picture column Amidst the constant fluctuations in the stock market.
Dow stocks to watch: Amgen, Caterpillar
Pharmaceutical maker Amgen continues to track a flat base amid a three-week losing streak. Stocks retreated from the 50-day line after sharp losses. At the moment, the correct buy point is 296.77, but the stock needs to retake 50 days decisively first. AMGN stock rose 0.6% on Tuesday.
Dow Jones member Caterpillar broke through the 239.95 buy point on a flat base last week, to me IBD MarketSmith Pattern Recognition, and only a few cents under the post-advance entry on Friday. To the upside, the stock’s RSI line, a major technical indicator, reached new highs. CAT stock rose 0.2% on Tuesday.
Top stocks to watch: Medpace, Neurocrine, O’Reilly, Texas Roadhouse
Medpace rebounded sharply from the 50-day line last week, with a gain of 3.3%. The stock rose 0.7% on Friday, extending the winning streak into four sessions. For now, the correct buy point is looming at 235.82, but early entry at 220.09 is also in play. MEDP shares fell 0.3% on Tuesday.
IBD Leaderboard Neurocrine stock fell 1.7% on Friday, ending a five-day winning streak that saw the biotech leader find support at the 50-day level. The strong rebound is bullish for the immediate outlook for the stock and the stock is likely to form the right side of a new base. NBIX stock fell 0.1% on Tuesday.
O’Reilly Auto Parts also found much needed support at the 50 day line last week and it remained squarely above the flat 750.98 entry level. A big bounce off the 50-day line may lead to a follow-up entry point, but the uptrend in the market is under pressure at present, which increases the risk of buying stocks. It is likely that a new base will form, which will provide new entry in the near future. ORLY shares rose 0.5% on Tuesday.
Texas Roadhouse is showing a new buy point at 101.85 in a flat base, but is now consolidating below the 50 day line. IBD Leaderboard stock will look to reclaim this key benchmark over the coming sessions, and the current two-day streak of gains is a promising start. TXRH stock was trading slightly higher on Tuesday morning.
Stocks to watch
These are the top four stocks to watch in the stock market today, including two Dow leaders.
|The Company’s name||Code||The right point of purchase||base type|
|Texas Roadhouse||(TXRH)||101.85||Flat base|
Source: IBD data as of December 27, 2022
Tesla stock It fell another 2% on Friday, extending the losing streak to six sessions and reaching a 52-week low. Last week, Tesla shares fell 18% to a 52-week low of 121.02. The shares closed about 69% from their 52-week high.
Shares extended losses on Tuesday morning, dropping another 5% after Reuters reported that Tesla extended production cuts that began this month into next year. Tesla stock hit a new low, trading as low as 116.49.
Tesla reportedly suspended production at its Shanghai factory on Saturday, accelerating its plan to halt production at the factory at the end of December.
Dow Jones leaders: Apple and Microsoft
in between Dow Jones stockApple shares fell 0.3% on Friday, closing near a 52-week low set on June 16 at 129.04. The stock is up about 28% from its 52-week high. The shares lost 0.6% on Tuesday.
Microsoft stock rose 0.2% on Friday, but remained below the 50-day line after last week’s drop of 2.4%. The software giant is still about 30% off its 52-week high. MSFT shares rose 0.1% early on Tuesday.
Be sure to follow Scott Lehtonen on Twitter at @employee Learn more about developing stocks and the Dow Jones Industrial Average.
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