Major stock indexes held onto most of their afternoon gains to close near session highs on Thursday, as Nvidia (NVDA) continued to rally after comments from CEO Jensen Huang and Bernstein analysts, pushing the stock above its 50-day moving average.
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Nasdaq S&P 500 Extends Winning Streak; Look to Arista Networks, Royal Caribbean, and Stride
The Dow Jones Industrial Average turned positive, closing up 0.6%. The index rebounded from its 50-day moving average on Wednesday. The S&P 500 closed up about 0.8% on the stock market today. The Nasdaq rose 1%, closing above its 50-day line again in a notable move.
Trading volume on the NYSE and Nasdaq was down compared to the same time on Wednesday, but the number of stocks that rose on the NYSE more than tripled and the Nasdaq nearly doubled.
The small-cap Russell 2000 rose 1.2%, while the Innovator IBD 50 ETF (FFTY) outperformed, rising 1.5%.
The yield on the benchmark 10-year Treasury note rose nearly 3 basis points to 3.68%.
RELX (RELX) ADR has broken out of a cup with handle with a buy point of 47.31. The British company provides information and analysis to professionals and businesses and has posted steady sales and revenue growth over the past eight quarters.
1:54 PM ET
Cathie Wood sells AI plays
Two stocks triggered sell signals: Investment bank and brokerage group Lazard (LAZ) fell below its 50-day moving average, with shares attempting to get back to that level in late trading.
In retail, Caleres (CAL) fell below its 200-day moving average in heavy trading after the shoe company reported weaker-than-expected July-quarter results and lowered its guidance, citing slowing demand.
Meanwhile, Cathie Wood’s Ark Innovation ETF (ARKK) sold 184,000 shares of software maker Palantir (PLTR). The artificial intelligence company is up 100% so far this year, and shares are just outside the profit zone from a 27.50 buy point.
12:16pm ET
Two Growth 250 Stocks Breakout
In the IBD MarketSurge Growth 250, Veeva Systems (VEEV) is trending lower after breaking out of the cup-with-handle at a buy point of 224.71. Veeva Systems is ranked #1 in the Medical Software industry group.
HA Sustainable Infrastructure Capital (HASI) is looking to trade above a buy point of 34 on a cup basis. The firm offers equity, joint ventures, real estate and other financing methods to facilitate the transition to alternative energy.
10:44 AM ET
Producer price index broadly in line with expectations
The producer price index rose 0.2% from the previous month in August, in line with consensus expectations. This data follows the August consumer price index, which showed core inflation was slightly higher than expected in August.
On an annual basis, however, inflation slowed as producers saw price increases shrink to 1.7% from the expected 1.8%.After Thursday’s inflation report, traders were pricing in an 85% chance of a 25-basis-point rate cut at next week’s Fed policy meeting.The chance of a larger 50-basis-point cut was just 15% according to the CME FedWatch tool.
Initial claims for unemployment insurance also rose to 230,000 from 227,000 in the week ending Sept. 7, in line with economists’ expectations, according to Econoday.
Futures: Nvidia leads seven new purchases, market signals bullish signs
Dow Jones Stock Index
Tech stocks Intel (INTC) turned lower, while Apple (AAPL) tried to recover to its 50-day moving average after dropping below it on Monday. Salesforce (CRM) rose 1.6%.
Among Dow retailers, Amazon.com (AMZN) and Walmart (WMT) rose, with Walmart hitting an all-time high despite a small increase.
Outside the Dow, Moderna (MRNA) plunged 12% after reports that sluggish vaccine sales are hurting the company’s research and development activities. The company plans to cut its research and development budget by 20% over three years. Moderna posted losses in its last two quarters. The company’s shares have been trending lower since June, according to IBD MarketSurge.
Profits lifted retailer Kroger (KR) after the company reported second-quarter profit of 93 cents per share, beating expectations of 91 cents per share, on sales of $33.9 billion, bouncing off its 200-day moving average, though sales fell short of the $34.1 billion target.
Magnificent Seven stock, Nvidia, rose, adding to a three-day rally, with the stock now rising above its 50-day moving average after falling 14% last week.
“Investors are concerned about sustainability because the numbers are so good (and rising so fast), but it’s clearly not time to worry,” Bernstein analyst Stacey Rasgon said Thursday. On Wednesday, CEO Jensen Huang said the return on investment in AI infrastructure remains strong.
Nvidia is listed on the IBD Leaderboard and the IBD 50.
Among other AI stocks, Adobe (ADBE) fell in after-hours trading after reporting third-quarter earnings. Revenue was $5.4 billion, up 11% year over year, and earnings per share were $4.65, up 14%. The company forecast $5.53 billion in revenue and $4.66 per share at the midpoint of the quarter, below analyst expectations of $5.6 billion in revenue and $4.67 per share.
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