The Dow Jones Industrial Average fell even as Walt Disney popped despite further escalation in its fight with Florida Gov. Ron DeSantis. A trio of Warren Buffett stocks are near entries as Berkshire Hathaway rose on earnings. AMC Entertainment rose while Advanced Micro Devices flashed a bullish signal.
A trio of names attempted breakouts despite the mixed action. Royal Caribbean Cruises, Fortune Brands Innovations and Axsome Therapeutics tested entries.
Meanwhile, the New York Fed's Survey of Consumer Expectations showed that the outlook for household spending fell in April. It dipped by 0.5% to an annual rate of 5.2%. This is the lowest reading since September 2021.
In addition, the Fed's Senior Loan Officer Opinion Survey showed share of banks tightening credit rose from 44.8% to 46.0%.
"A couple key takeaways from the Fed (Senior Loan Officer) survey were that the commercial real estate space is going to feel more pain soon and as banks expect to tighten standards across all loan categories for the remainder of the year," Oanda senior market analyst Ed Moya said in a note to clients. "This key survey should support recessionary calls for the third quarter."
Treasury yields moved higher. The 10-year yield rose seven basis point to 3.52% while the two-year yield spiked nine basis points to 4.1%. The yield curve remains inverted.
Nasdaq Gains As Small Caps Fall
The Nasdaq fared best out of the major indexes but only rose 0.2%. CrowdStrike was among the Nasdaq standouts as it popped 8.1%.
The benchmark S&P 500 was also slightly higher, rising less than 0.1%. Advanced Micro Devices impressed here as it popped about 6%, breaking out from a trendline. It offers an entry around 90. The stock is still in a consolidation pattern with a 102.53 buy point.
The S&P 500 sectors were mixed. Communication services and consumer discretionary were the top performers while industrials and real estate lagged the most.
Small caps lagged, with the Russell 2000 closing down 0.3%. Growth stocks reversed higher, with the Innovator IBD 50 ETF gaining 0.3%.
Dow Jones Today: Disney Stock Leads As DeSantis Fight Intensifies
The Dow Jones fared worst out of the major indexes. It closed down 56 points, or 0.2%
Walt Disney stock fared best on the Dow Jones today, rising 2.5%. The company will report earnings on Wednesday.
It was up despite news the firm has expanded its federal lawsuit against DeSantis. It took the step after he signed legislation that voided the firm's development deals in Orlando, Fla.
Disney is accusing the potential Republican presidential candidate of enacting a political retribution campaign against it.
Warren Buffett Stocks Near Entries Amid Berkshire Earnings
Berkshire Hathaway stock closed higher after the firm reported better-than-expected Q1 earnings last weekend.
The Warren Buffett-led firm posted a 12.6% increase in operating earnings. EPS came in at $3.69 vs. analyst expectations for $3.58, according to FactSet.
Berkshire stock finished off highs but still lifted 0.7%. It is trading below a cup base entry of 352.20, MarketSmith analysis shows.
Meanwhile a trio of Warren Buffett stocks are trading near buy points after the earnings report.
Insurance play Aon is in the buy zone above a cup with handle entry of 328.43. Excellent all-around performance has netted it an IBD Composite Rating of 91.
Chinese EV stock BYD is now eying its own cup with handle buy point of 31.17. Earnings are a key strength, and it boasts an impressive EPS Rating of 97.
Mastercard moved higher in its buy zone above a double-bottom base entry of 369.25. The stock was a recent IBD Stock Of The Day.
Zscaler Stock Soars On Results
Cybersecurity stock Zscaler surged after the firm preannounced results Monday.
The company expects non-GAAP income in a range of $60 million to $64 million in the April quarter, up from previous guidance for $55 million to $56 million. It raised full-year income outlook to about $222 million.
It expects revenue to be in a range of $415 million to $419 million for the April quarter. This cleared its previous forecast for $397 million at the midpoint of its outlook.
For full-year fiscal 2023, the cybersecurity firm predicted revenue in a range of $1.581 billion to $1.591 billion, up from an earlier outlook of about $1.56 billion.
"Today's announcement would put revenue about 5% above our estimate at the midpoint, but more importantly the upside in billings shows an acceleration from last quarter," MoffettNathanson analyst Sterling Auty said in a note to clients.
Zscaler stock rocketed 20.6%. The stock popped above its 50-day moving average, but this would be a very aggressive entry point.
It turned in its largest its percentage increase since Dec. 3, 2020, when it rose 26.45%, according to Dow Jones Market Data.
AMC Stock Up Amid Settlement News
Movie theater play AMC closed slightly higher following the news it had struck a deal to settle a shareholder lawsuit.
The firm announced it has reached an agreement with equity holders over a proposed conversion of AMC Preferred Equity Units to common company shares. AMC stockholders who are class members can still object to the settlement. The deadline for this is May 31.
The settlement proposal must also be approved by a Delaware Chancery Court judge, with a hearing set for June 29-30.
AMC stock was briefly dragged lower along with the overall market, but was slightly positive heading into the close.
Outside Dow Jones: Three Stocks Test Entries
A trio of noteworthy stocks attempted breakouts amid the mixed action.
Royal Caribbean Group sits in a buy zone after sailing above a cup-base entry of 76.40. The relative strength line is at fresh heights, while the issue is among the top 5% performing over the past 12 months.
Building materials play Fortune Brands Innovations is actionable after clearing a cup-with-handle buy point of 65.59.
Volume was 34% above average in the move. Overall strong performance is reflected in its Composite Rating of 91.
Axsome Therapeutics is below its entry after testing a consolidation buy point of 82.10. A handle entry at 76.45 is also discernible on the chart, and Axsome is above it. Earnings are a major weakness, with its EPS Rating a poor 12 out of 99.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more analysis of growth stocks.
