The Dow Jones Industrial Average fell as new Fed official Lisa Cook touted ongoing interest rate hikes. Marijuana stocks such as Canopy Growth and Tilray rocketed on a move by President Joe Biden. General Electric reversed amid layoffs.
Chevron and Caterpillar were top blue chips. Meanwhile, a trio of stocks were showing bullish signs. WillScot Mobile Mini passed a buy point while Molina Healthcare and O'Reilly Automotive were eyeing entries.
Volume was mixed on the Nasdaq and the New York Stock Exchange according to preliminary data.
The yield on the benchmark 10-year Treasury note rose seven basis points to 3.82%. West Texas Intermediate crude oil popped 1.4% to trade at around $89 per barrel.
Initial jobless claims rose to 219,000 in the week ended Oct. 1, higher than analyst expectations. The data comes ahead of the September nonfarm payrolls report due out Friday morning.
Fed Governor Backs Ongoing Hikes
New Federal Reserve Gov. Lisa Cook used her first public speech since taking office to push back against hopes the central bank will soon pause on raising interest rates. Instead, she underlined the importance of "ongoing rate hikes" amid runaway inflation.
"In our current economy, with a very strong labor market and inflation far above our goal, I believe a risk-management approach requires a strong focus on taming inflation," Cook said at a Peterson Institute for International Economics event.
Cook took office as a member of the Board of Governors at the end of May.
Oanda senior market analysts Edward Moya highlighted the new round of hawkish Fed speech.
"Minneapolis Fed President Neel Kashkari signaled there is no Fed pivot coming until financial conditions worsen significantly from here," Moya said in a note to clients. "Kashkari said the Fed will keep hiking rates to bring inflation down and that they are 'quite a ways away' from pausing their tightening cycle."
Nasdaq, Small Caps Reverse
A positive early open on the Nasdaq soon gave way to renewed selling pressure. It closed down 0.7%. The S&P 500 struggled even more, dipping 1%.
The S&P 500 sectors were nearly all negative, with only energy in the green. Utilities and real estate areas were struggling the most.
Small caps held up better but the Russell 2000 still fell 0.6%.
The Innovator IBD 50 ETF, a bellwether for growth stocks, reversed late to close down 0.5%.
Dow Jones Today: Chevron Stock Shines
The Dow Jones Industrial Average was at session lows, falling 347 points. This equates to a decline of 1.2%.
Chevron was the best performer on the Dow Jones today amid bullish action among energy stocks. It rose 1.8%.
Caterpillar stock was also among the better performers as it rose 0.2%.
Downside action was heavier, with 3M lagging most. It closed the day down 3.5%.
Marijuana Stocks Surge On Biden Move
Marijuana stocks exploded late on the news President Joe Biden has ordered a review of federal pot laws.
Secretary of Health and Human Services Xavier Becerra and Attorney General Merrick Garland will examine how marijuana is classified under federal drug laws.
He is also pardoned all prior federal offenses of simple marijuana possession, which equates to thousands of individuals.
"There are thousands of people who were convicted of marijuana possession who may be denied employment, housing, or educational opportunities as a result," Biden said. "My pardon will remove this burden on them."
Canopy Growth, whose Canadian ticker is WEED, closed up 22.2%. Tilray vaulted 30.9%. Cronos Group rose 13.5%.
Marijuana-focused exchange-traded fund MG Alternative Harvest gained 19.6%. Nevertheless, marijuana stocks remain well down so far in 2022.
GE Stock Slammed After Wind Move
Former investor favorite General Electric was among the stocks tumbling Thursday, falling 1.8%.
It was slipping after it emerged the company is firing 20% of its U.S. onshore wind workforce. The firm is taking the step amid rising input costs and increasing competition.
GE stock is currently in a state of flux as the firm looks to split into three different companies, one focused on health care, another on aerospace and the last on energy.
It is currently sitting around 9% below its key 50-day moving average after falling nearly 32% so far in 2022. This means it is underperforming the benchmark S&P 500 index.
Investors Take Out Trash Stocks
Waste management stocks had been flourishing despite the overall bearish action.
But that came to a crushing end for waste disposal play Waste Connections Thursday. It flashed multiple sell signals after it plunged 5%, though it ended the day off lows. It has now crashed below the 50-day moving average.
In addition, it briefly fell more than 8% below a cup-with-handle buy point of 144.56. Volume was high on the move. This is another key signal that investors are heading to the exits in droves.
It did find support at its 200-day moving average but rebounding from here will be key.
Waste Management was also struggling. It fell 4.3% and is nearing a test of its 200-day moving average.
Market Reverses As Jobs Report Looms; Musk Makes New Twitter Demands
Outside Dow Jones: 3 Stocks Look Bullish
WillScot Mobile Mini is trading in a buy zone after clearing a flat base entry of 43.81, MarketSmith analysis shows. Its relative strength line has surged to new highs, a bullish sign.
Stock market performance is a key strength, with WSC stock in the top 4% of issues in terms of price performance over the past 12 months. Institutional support is very strong, with 71% of shares held by funds.
The firm leases modular space and portable storage units to customers across multiple industries.
Meanwhile, Molina Healthcare also formed a flat base, though price has yet to reach its 361.35 buy point. The relative strength line is also looking impressive here, rising to a new high.
The company provides managed health care services through Medicaid and other insurers.
Earnings are a key strength, with the stock holding an EPS Rating of 92 out of 99. The Accumulation-Distribution Rating of "B-" is impressive as well, with 70% of shares held by funds.
O'Reilly Automotive is moving toward a 750.98 flat base entry. The auto parts retailer is also worth watching, given the market's defensive bent at the moment.
Both earnings and price performance are strong, winning the stock a mighty IBD Composite Rating of 95. It holds an Accumulation/Distribution Rating of B+, which reflects rising institutional investment.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more analysis of growth stocks.
