The Dow Jones Industrial Average greeted the new year by briefly dropping 195 points Tuesday, as investors digested reports on manufacturing and construction spending. Meanwhile, Tesla rallied on better-than-expected fourth-quarter deliveries, while Apple stock sold off on an analyst's downgrade.
After the opening bell, the Dow Jones Industrial Average dropped 0.1%, while the S&P 500 fell 0.6%. The tech-heavy Nasdaq composite declined 1.5% in morning action.
Among U.S. exchange traded funds, the Nasdaq 100 tracker Invesco QQQ Trust was down 1.4%, while the SPDR S&P 500 ETF fell 0.6%.
Oil prices looked to rebound after a three-day losing streak, as West Texas Intermediate futures climbed more than 1% Tuesday morning, going past $72 a barrel.
Early Tuesday, the S&P Global Purchasing Managers' Manufacturing Index for December fell to 47.9 vs. 49.4 in November.
Also, the Labor Department said that construction spending rose 0.4% in November, slightly below estimates for a 0.6% rise.
On the earnings front this week, Cal-Maine Foods, Conagra and Dow Jones member Walgreens Boots Alliance will report their quarterly results.
Apple Downgrade, Tesla Deliveries
Apple declined 3.1% Tuesday morning after Barclays downgraded the stock to underweight from equal weight, with a new price target of 160 that is down from 161. Barclays analysts noted weakness in sales of iPhones and Mac computers.
Meanwhile, electric-vehicle giant Tesla reported fourth-quarter deliveries of 484,507 vehicles, above Wall Street's estimate for deliveries between 475,000 and 480,000, according to Barron's. TSLA stock reversed up 0.5% in morning trading.
The EV giant skidded another 1.9% Friday, falling back below its latest entry at 252.75. Tesla stock has a big double-bottom pattern with conventional buy point of 278.98.
Stock Market Forecast 2024: A Soft Landing May Not Bring The Gains You Expect
Dow Jones At New Highs
The Nasdaq composite ended Friday down 0.6%, booking a yearly gain of 43.4%. This was its best annual lift since 2003.
The S&P 500 also gave up ground, falling 0.3% in the year's final session. The benchmark index climbed 24.2% during 2023.
Finally, the Dow Jones Industrial Average held up the best out of the major indexes on Friday despite a 0.1% dip. The Dow 30 blue chip stocks rallied 13.7% for the year.
Friday's Big Picture column commented, "A notable feature of 2023's outperformance was the tremendous returns of stocks in the so-called Magnificent Seven group. Investors undoubtedly would like to see the stock market rally broaden out in the coming year. Key to this will be the Fed cutting interest rates. Investors undoubtedly will scour Fed minutes due in the coming week as they look for clues to future policy direction. The data is set to be released on Wednesday."
Now is an important time to read IBD's The Big Picture column amid the continuing stock market gains. Be sure to read how to invest during the ongoing uptrend.
Learn How To Time The Stock Market With IBD's ETF Market Strategy
Best Stocks To Buy And Watch
Magnificent Seven player Alphabet, Celsius, Monday.com, Netflix and Snowflake — along with Dow Jones components Amgen, Caterpillar and Visa — are among the best stocks to buy and watch in the current market rally.
Microsoft and Netflix are featured in this Stocks Near A Buy Zone column.
Get Real-time Buy And Sell Alerts On Stock Market Leaders With IBD Leaderboard
Dow Jones: Amgen Attempts Breakout
Drug leader Amgen is trying to break out past a 288.46 official buy point in a flat base amid a 0.15% fall Friday. AMGN stock rose 0.3% early Tuesday.
Heavy machinery giant Caterpillar remains above a 293.88 buy trigger, despite a 0.4% drop Friday. CAT stock was off 0.5% Tuesday morning.
Payments leader Visa remains in buy range above a 250.06 entry in a cup base, according to IBD MarketSmith pattern recognition. V stock was down 0.4% Tuesday.
4 Top Growth Stocks To Watch In The Stock Market Rally
Alphabet, Netflix In Buy Range
Alphabet is testing a 139.42 buy point in a cup with handle following a Dec. 20 breakout move. GOOGL stock dropped 1.6% early Tuesday.
Netflix ranks among the best stocks to buy and watch, even as it fell 0.7% Friday. The streaming giant broke past a 482.70 buy point out of a cup with handle in recent weeks. NFLX stock lost 2.6% Tuesday morning.
Fitness drink leader Celsius raced higher last week, bullishly retaking the 50-day line for the first time since early November. Investors could view the recent strength as an aggressive entry. The official buy point is 68.95. Investors could use 62.99 or a downward-sloping trendline as other early entries. CELH stock fell 2% Tuesday morning.
Monday.com continues to hold just above a 185.81 buy point in a cup with handle after a 1.6% loss Friday, according to IBD MarketSmith. MNDY stock was down 4% Tuesday.
Artificial intelligence leader Snowflake remains squarely in its buy range past a cup-with-handle's 192.66 buy point, with a 1.1% fall Friday. SNOW stock declined 3.2% early Tuesday.
Best Bets In Today's Action
These are four best stocks to watch in today's stock market, including a Dow Jones leader.
| Company Name | Symbol | Correct Buy Point | Type Of Buy Point |
|---|---|---|---|
| Celsius | 68.95 | Consolidation | |
| Caterpillar | 293.88 | Cup base | |
| Netflix | 482.70 | Cup with handle | |
| Snowflake | 192.66 | Cup with handle |
Source: IBD Data As Of Jan. 2, 2024
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Magnificent Seven Stocks: Nvidia
Magnificent Seven stock Nvidia lost 3.5% Tuesday morning.
Nvidia ended Friday's session unchanged, holding just shy of a flat base's 505.48 buy point. An IBD Leaderboard stock, Nvidia still is considered to be in a buy zone off a double-bottom base with a 476.09 entry that formed prior to the flat base.
Dow Jones Leaders: Microsoft
Among the Dow Jones stocks in the Magnificent Seven, Microsoft, traded lower after Tuesday's stock market open.
Microsoft stock gained 0.2% Friday, still modestly above a 366.78 cup-base buy point. And the software giant was down 2.1% Tuesday morning.
Be sure to follow Scott Lehtonen on X, formerly known as Twitter, at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
