The Dow Jones Industrial Average and other indexes were higher heading into the close after Fed Chair Jerome Powell spoke out on the future path of monetary policy Tuesday. Among individual stocks, Tesla (TSLA) surged on a deliveries beat while Amazon.com (AMZN) gained little ground despite a bullish call. Eli Lilly (LLY) and Novo Nordisk (NVO) fell on the stock market today after being criticized by President Joe Biden.
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The Dow Jones average was up almost 100 points, or 0.3%. The tech-heavy Nasdaq composite rose 0.7%. Chip stock ON Semiconductor (ON) fared well on the tech-heavy Nasdaq as it rose more than 4%.
Meanwhile, the S&P 500 added 0.4%. Paramount Global (PARA) stood out as it rose more than 4% amid speculation it may merge Paramount+ with a rival streaming service, such Warner Bros. Discovery‘s (WBD) Max. Fertilizer maker CF Industries (CF), however, skidded nearly 4% and is the worst performer today in the S&P index.
S&P 500 sectors were mixed in late trading. Consumer discretionary and communication services fared the best while energy and health care were the worst performers.
Small caps were gaining some ground after yesterday’s drawdown. The Russell 2000 reversed higher, rising 0.1%. The Innovator IBD 50 ETF (FFTY) erased losses to trade flat on the stock market today.
Biden Call Wobbles Weight-Loss Leaders
It has been a challenging week for President Biden. But he took some time out of the presidential campaign race to lash out at stock market leaders Eli Lilly and Novo Nordisk.
In an editorial co-authored with socialist Senator Bernie Sanders, a former rival, they accused the companies of ripping off Americans.
The duo said Novo Nordisk and Eli Lilly are charging “unconscionably” high prices for their popular prescription drugs. Novo’s Wegovy and Ozempic were called out specifically, along with Lilly’s Mounjaro.
Novo Nordisk remained down nearly 2%, but was off session lows. It has slipped back into the buy zone above a 137.22 entry. Eli Lilly, which is extended, pared losses and was down less than 1%.
Eli Lilly was boosted Tuesday afternoon after the Food and Drug Administration approved its Alzheimer’s drug, donanemab. It targets and clears amyloid plaque, though such drugs carry safety risks. The market for such treatments is large, with almost 7 million Americans suffering from Alzheimer’s.
Both Eli Lilly and Novo Nordisk are members of the IBD Leaderboard list of top growth stocks. Both stocks are up a huge amount in 2024, with Eli Lilly rising more than 56% and Novo Nordisk gaining more than 38%.
Updated 1:38 p.m. ET
Stock Market Today: Tesla Gains Accelerate
Tesla bulls manhandled the bears as the electric-vehicle play built on early gains. Tesla stock surged around 9% in afternoon trading after the firm beat analyst views on deliveries.
The company reported 443,956 deliveries in the second quarter, easily surpassing expectations for 420,000 to 425,000. While this cleared Wall Street views, it also came in below the 466,000 EVs delivered in the second quarter of 2023.
Tesla also said Tuesday that it deployed 9.4 gigawatt-hours of energy storage products in the second quarter. This was the firm’s highest quarterly deployment to date.
Tesla stock is now extended from a 191.08 handle buy point. The buy range ran as high as 200.63. It has surged well clear of the 200-day moving average. Shares rose the five previous sessions.
EV Stock Polestar Dives In Volume
But all was not rosy in the EV stock front. Polestar (PSNY) was getting pummeled after the firm posted results.
It fell more than 3% in high volume. The stock has lost almost 95% of its value after hitting an all-time high of 16.41 in November 2021 and trades at less than 1 a share.
The firm turned in a Q1 loss of $274.3 million vs. a loss of $37.7 million a year ago. Polestar reported an 80% increase in car deliveries in the second quarter of 2024 compared to the first.
It also announced it had cut 15% of positions, on top of a 10% reduction in 2023. Despite this, CEO Thomas Ingenlath said in a press release that the firm has “strong momentum as we enter the second half the year.”
Kinetik Stock Moves Above Entry
Energy processing services company Kinetik (KNTK) has moved clear of a flat-base entry at 41.77, according to MarketSurge analysis. The 5% buy zone goes as high as 43.85.
This is a first-stage base, which means it has a better chance of netting good gains. Overall performance is solid, with its IBD Composite Rating coming in at 92 out of 99.
The company, which operates in the Permian Basin, has segments including midstream logistics and pipelines.
Updated 11:52 a.m. ET
GM Reports Best Quarterly Sales In Years, Stock Steady
General Motors (GM) announced its best U.S. quarterly sales in a number of years, though the stock was little changed.
The car-making titan reported unit sales of 696,086 in the second quarter, a rise of 0.6% year over year. That was the company’s best unit sales figure since the fourth quarter of 2020. EV sales popped 40% to 21,930, though they remain a tiny fraction of sales overall.
GM stock battled to turn positive on the stock market today, but managed only a marginal gain. It continues to trade in a buy zone above a flat-base entry of 46.16, according to MarketSurge analysis.
Job Openings Rebound
The number of job openings in the U.S. fought back from a more than three-year low, the Labor Department said Tuesday.
Job postings popped to 8.1 million in May, with the bulk of the increase coming from government roles. This was an increase from 7.9 million in April.
Job openings hit a record of 12 million in 2022. While there has been some softening, they remain above pre-Covid levels.
It is a key week for labor data, with the latest jobs report due Friday.
Jeffrey Roach, chief economist for LPL Financial, says job openings in higher paying roles are moderating as the labor market shows early signs of cooling.
“As long as the job market is stable, the soft landing narrative appears likely as consumers will have some capacity to spend,” he said in a note to clients. “However, a strong labor market will make the Fed’s job more difficult in their efforts to get inflation closer to their 2% target.”
Updated 10:47 a.m. ET
Fed Chair Powell Speaks Out
Fed Chair Powell spoke out on the future path of interest rates at the European Central Bank forum Tuesday, and said that “significant progress” was made on bringing down both core and headline inflation.
“Sitting here last year there was a lot we didn’t know,” Powell said. “We didn’t know we were about to embark on a period of seven months of much lower inflation readings, we didn’t realize that the second half last year was going to be an extraordinary year from a growth standpoint and also from the same point of the labor, so things actually worked out in the second half last year in a remarkable way.”
He said that in the first half 2024 the U.S. “continued to have solid growth” as well as a “a labor market that’s still strong, though we’ve seen a continued rebalancing in the labor market.” He also said that inflation looks to be back on a disinflationary trend after pausing in the first quarter.
“I think the last reading, and the one before it to a lesser extent, do suggest that we are getting back on a disinflationary path. We want to be more confident that inflation is moving sustainably down toward 2% before we start the process of loosening policy,” Powell said. “What we would like to see is more data like what we’ve been seeing recently. We would also like to see the labor market remain strong. We’ve said that if we see the labor market unexpectedly weakening that is also something that could call for a reaction.”
Stock Market Today: Apple Stock Pops
Apple fared best among stocks on the Dow Jones Industrial Average, turning in a gain of nearly 1%. The stock is now extended past a cup base entry of 199.62.
3M (MMM) and Honeywell International (HON) also outperformed on the much-watched index.
Nike (NKE) lagged the most as it continues to suffer following its dreadful earnings report, skidding nearly 2%. Verizon Communications (VZ) also dropped, falling more than 1%.
Amazon Nears AI ‘Inflection Point’
Elsewhere, Mizuho analyst James Lee named another Magnificent Seven stock, Amazon, as a “top pick” in a note to clients. Lee gave the stock a price target of 240.
“Gen-AI projects are nearing an inflection point, with external-facing models six months away from commercial deployments,” Lee said in his note.
With the company’s large base of customers, he expects “inferencing activity should accelerate meaningfully” which increased his conviction in the firm’s cash cow Amazon Web Services business.
Amazon stock was nearly flat on the stock market today. It is trading in a buy zone above a flat base entry of 191.70.
The stock has a Composite Rating of 93 from Investor’s Business Daily and is a member of the prestigious IBD Leaderboard list of top growth stocks.
Stock Market Today: Stocks Near Buy Points
Financial software play Alkami Technology (ALKT) is flirting with a cup base entry of 29.29, according to MarketSurge analysis.
The stock holds a near-perfect IBD Composite Rating of 98. Earnings performance is solid, with its Earnings Per Share Rating coming in at 80 out of 99. It is in the top 5% of issues in terms of price performance over the past 12 months.
Banking giant Goldman Sachs (GS) is nearing a flat-base entry of 471.48 on the stock market today. The relative strength line is bending higher again after a dip.
Overall performance is good, with its IBD Composite Rating coming in at 97. Big Money has been snapping up shares of late, with its Accumulation/Distribution Rating sitting at B-.
Please follow Michael Larkin on X, formerly known as Twitter, at @IBD_MLarkin for more analysis of growth stocks.
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