Dow Jones Rallies After Stock Market Dive; Platoon, Upstart Crash On Earnings

The Dow Jones Industrial Average rallied as much as 400 points Tuesday, rebounding after Monday’s stock market dive saw major indexes sustain heavy losses to hit new correction lows. Later today, President Joe Biden will discuss inflation and other matters in a White House speech.


Earnings news stirred widely mixed early action. CarGurus (LOAD), microchip (MCHP) and upstart (UPST) reported their earnings results late Monday. Meanwhile, Chinese electric-vehicle leader Li Auto (LI), Platoon (PTON), Planet Fitness (PLNT) and transdigm (TDG) are among the companies reporting Tuesday morning.

CarGurus shares dived 15% early. And Microchip stock rallied nearly 6% morning trade. Upstart crashed 54%. Li Auto jumped 10%. Platoon plunged 17%. Planet Fitness swings up 2.5%. And TransDigm gained 3.7%.

electric-vehicle giant Tesla (TSLA) rallied about 4% Tuesday morning, despite data from the China Passenger Car Association showing a sharp slowdown in Tesla’s China sales in April. Dow Jones Leaders Manzana (AAPL) moved up 2.6%, and microsoft (MSFT) gained 3% in today’s stock market.

Amid a deepening stock market correction, Dow Jones leaders Chevron (CLC) and Merck (MRK)—along with Cheniere Energy (LNG) and Exxon Mobil (XOM) — are among IBD’s top stocks to watch for Tuesday.

Cheniere Energy, Microsoft and Tesla are IBD Leaderboard stocks. Exxon and Merck were featured in last week’s Stocks Near A Buy Zone column.

Dow Jones Today: Treasury Yields, Oil Prices

After Tuesday’s open, the Dow Jones Industrial Average gained 1.2%. The S&P 500 advanced 1.3%. And the Nasdaq climbed 1.5% in morning trade after paring early gains.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) moved up 1.5%. The SPDR S&P 500 ETF (SPY) rose 1.3%.

The 10-year Treasury yield dropped to 2.98% Tuesday morning after closing Monday around 3.08%. The 10-year Treasury yield is at its highest level since November 2018. Meanwhile, US oil prices traded 0.5% higher, with Texas Intermediate crude hovering around $103 a barrel.

President Biden will give a speech at 11:30 am ET Tuesday, highlighting his attempts to fight rising inflation. On Wednesday, April’s consumer price index will provide a report card on that fight. Per Econoday, consumer prices are expected to rise 0.2% on the month in April versus March’s 1.2% increase which was the largest monthly advance in 42 years.

According to Bloomberg, Biden plans to detail his legislative efforts ahead of November’s midterm elections. Meanwhile, Biden’s approval rating is back near February’s low point.

Stock Market Correction Deepens

On Monday, the Dow Jones industrials, Nasdaq and S&P 500 hit new correction lows, as the stock market plunged. The S&P 500 and Nasdaq Composite have each declined for five straight weeks — the longest consecutive downtrend for both since a six-week drop in June-July 2008.

The market’s dive to new correction lows snuffed out anything resembling a rally attempt. That means investors should be on the lookout for an up day to signal the start of a new rally attempt.

Monday’s The Big Picture column commented, “The Nasdaq’s 4.3% loss Monday cemented a three-day losing streak of more than 10%. That’s the largest three-day decline since March 2020 (during the pandemic bear market). Its three-day, 1,341-point loss is the largest on record, according to Dow Jones Market Data.”

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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, Merck

Despite the market drop, US oil prices continue to hold above $100 a barrel. That has helped keep Dow Jones leader and energy giant Chevron in a flat base that has a 174.86 buy point, according to IBD MarketSmith chart analysis. CVX shares traded down 6.7% Monday, placing them below their 50-day line. Chevron shares gained 2.5% Tuesday morning.

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

Drug leader Merck is just below a cup with handle’s 89.58 buy point following a brief breakout attempt last week. Shares were flat early Tuesday.

Positively, the stock’s relative strength line is at new highs, indicating big stock market outperformance during the current stock market correction.

Three Top Growth Stocks To Watch In The Current Stock Market Correction

Stocks To Watch: Cheniere, Exxon

IBD Leaderboard stock Cheniere Energy is one of the top stocks to watch despite losing 8.6% Monday. Shares are etching a flat base that shows a 149.52 buy point, according to IBD MarketSmith chart analysis. LNG shares were up 2% Tuesday.

Energy giant Exxon Mobil broke out past a cup with handle’s 89.90 buy point last week. But shares gave up the entry and are about 6% below the buy point following Monday’s 7.9% dive. The faltering breakout illustrates the danger of owning any stocks in the current market environment. XOM shares rebounded about 2% Tuesday.

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

Tesla Stock

Tesla stock rebounded more than 4% Tuesday morning, looking to recover a part of Monday’s 9.1% dive and snap a three-day losing streak. Shares are again below their 50- and 200-day lines.

The stock traded as high as 1,243.49 on Nov. 4 and is about 37% away from that all-time high.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares lost 3.3% Monday, falling further below their 200-day line. Apple stock rose 2.6% Tuesday.

Software leader Microsoft slid 3.7% Monday, declining for a third session in a row. The stock closed about 24% off its 52-week high. MSFT shares moved up 3% Tuesday morning.

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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