The Dow Jones Industrial Average reversed lower Thursday after an early release of fourth-quarter GDP and first-time jobless claims. Meanwhile, Tesla stock surged as much as 11% on strong fourth-quarter earnings results and Chief Executive Elon Musk's subsequent comments.
The Commerce Department's fourth-quarter GDP slowed to 2.9% annualized growth, higher than the expected 2.7% growth vs. third-quarter growth of 3.2%. Further, the Labor Department's initial unemployment claims unexpectedly fell to 186,000. Claims were expected to rise to 202,000 vs. 190,000 in the previous week.
Fourth-quarter earnings season continues, as results have come in from American Airlines, IBM, Mastercard, Mobileye Global, ServiceNow and Southwest Airlines.
American Airlines shares reversed 1% lower in morning trade, while Southwest stock declined nearly 4%. Dow Jones stock IBM beat Wall Street's fourth-quarter expectations, but shares fell more than 3.5% in early morning trade.
Shares of Mastercard rose less than 1% after its fourth-quarter report. Mobileye shares jumped more than 11% on strong fourth-quarter results. Finally, ServiceNow reported December-quarter earnings that topped views while revenue growth only met expectations. NOW stock rose almost 3% in morning trade.
Stock Market Today
Electric-vehicle leader Tesla rallied 7% on strong fourth-quarter results and a raft of analyst price target hikes. Dow Jones tech giants Apple and Microsoft were higher after today's stock market open.
IBD Leaderboard stock Axon Enterprise, recent IBD Stock Of The Day Etsy, Monster Beverage and Vertex Pharmaceuticals — as well as Dow Jones names Chevron, JPMorgan Chase and Visa — are among the top stocks to buy and watch, with the ongoing strength of the market rally.
Axon is an IBD Leaderboard stock. Etsy and Vertex were recent IBD Stocks Of The Day. Axon and JPMorgan were featured in this week's Stocks Near A Buy Zone column.
Dow Jones Today: Oil Prices, Treasury Yields
After Thursday's opening bell, the Dow Jones Industrial Average turned down 0.15%, and the S&P 500 moved up 0.2%. The tech-heavy Nasdaq composite cut gains to 0.7% in morning action.
Among U.S. exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust gained 0.7% and the SPDR S&P 500 ETF traded up 0.2% early Thursday.
Overseas, Hong Kong's Hang Seng Index reopened after its New Year's holiday break with a 2.4% advance. The mainland Shanghai Stock Exchange remains closed through Friday.
The 10-year U.S. Treasury yield ticked higher to 3.5% Thursday morning, looking to rebound after a two-day slide. With the advance in bonds now tacking toward a fourth week, the 10-year yield is trading near its lowest level since mid-September.
Oil prices rose nearly 2% Thursday, with West Texas Intermediate futures holding above $81 a barrel. Oil is down less than 1% for the week, after touching an eight-week high on Monday.
Stock Market Rally
On Wednesday, the Dow Jones Industrial Average inched higher, and the S&P 500 slashed early losses to less than 0.1%. The tech-heavy Nasdaq Composite gave up 0.2%, narrowing its decline after falling more than 2% early.
Wednesday's The Big Picture column commented, "To find the new leaders, it's time to use IBD screens and accept the results for what they are. This means checking the Stocks On The Move table, seeing what is making waves inside IBD Big Cap 20, and surveying the leading sectors within the daily New Highs list in IBD Data Tables — just to name a few lists."
Now is an important time to read IBD's The Big Picture column amid the ongoing stock market rally.
Five Dow Jones Stocks To Buy And Watch Now
Dow Jones Stocks To Buy And Watch: Chevron, JPMorgan, Visa
Energy giant Chevron is rounding out the right side of a cup base with a 189.78 buy point, according to IBD MarketSmith pattern recognition. Keep an eye out for a handle to offer a lower entry. Chevron's fourth-quarter earnings are due Friday. CVX shares jumped 3% Thursday after the company raised its dividend and announced a $75 billion stock buyback program.
CVX stock shows a solid 91 out of a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. The Composite Rating is designed to help investors easily find top growth stocks.
Banking giant JPMorgan is back above a 138.76 flat-base buy point following four consecutive sessions of gains. JPM shares were up 0.3% Thursday morning.
Payments leader Visa is trading in buy range above a 220.08 handle buy point in a long pattern. The 5% buy area goes up to 231.08. Visa shares rose 0.5% early Thursday ahead of the company's fiscal first-quarter results due out after the close.
4 Top Growth Stocks To Buy And Watch In The Stock Market Rally
Top Stocks To Buy And Watch: Axon, Etsy
Security leader Axon rallied 1.7% Wednesday, moving back into buy range above a 189.72 buy point in a cup-with-handle base. The buy zone tops out at 199.21. Axon shares were up 0.4% Thursday morning.
Backstory: Formerly known as Taser International, the company has taken advantage of the business opportunity offered by public demands for more oversight of police departments. Its line of body cameras and accompanying software are now market leaders. The Scottsdale, Ariz.-based company also boasts a cloud-based digital evidence platform.
Etsy broke out past a 137.01 buy point in a cup with handle Monday, but fell further below the entry with a 0.6% loss Wednesday. If the stock retakes the buy point, the 5% buy area goes up to 143.86. ETSY stock was up 2.8% Thursday.
Backstory: The company is a provider of an online e-commerce platform where creators of arts and crafts, vintage items and other unique goods go to sell their products. It has a unique business model that, in the last few years, has gone from a niche e-commerce marketplace to a top-of-mind shopping destination across numerous categories.
Monster, Vertex Eye Buy Points
Monster Beverage is within striking distance of a flat base's 104.75 buy point after Wednesday's 0.5% gain. MNST stock was up 0.1% Thursday.
Backstory: Monster Beverage leads an energy-drink duopoly with privately held competitor Red Bull. The company's portfolio of energy drink brands include Monster Energy, Reign and NOS Energy.
Monster dominates energy drinks in the U.S. and claimed a 39% market share last year, according to Jefferies data, resulting in a record $5.5 billion in revenue for the company. Red Bull accounted for 37% of the American energy drink market in 2021. Upstart Celsius, which is on an impressive growth streak, claimed 4.9% of the market.
Recent IBD Stock Of The Day, Vertex Pharmaceuticals, is approaching a 324.85 buy point in a cup base after bullishly retaking its 50-day line in recent sessions. VRTX stock rose 0.4% Thursday.
Backstory: The company is well-known for its cystic fibrosis treatments — a market that Vertex estimates at 88,000 patients. Of those, there are still 20,000 patients who could receive its old-school oral treatments. But analysts are watching for what's new from Vertex, including an updated regimen of three drugs that could strengthen Vertex's position against rival AbbVie.
Stocks To Buy And Watch In Stock Market Rally
These are seven top stocks to buy and watch in today's stock market, including three Dow Jones leaders.
| Company Name | Symbol | Correct Buy Point | Type Of Base |
|---|---|---|---|
| Monster | 104.75 | Flat base | |
| Vertex | 324.85 | Cup base | |
| Axon | 189.72 | Cup with handle | |
| Etsy | 137.01 | Cup with handle | |
| JPMorgan | 138.76 | Flat base | |
| Chevron | 189.78 | Cup base | |
| Visa | 220.08 | Cup with handle |
Source: IBD Data As Of Jan. 26, 2023
Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live
Tesla Stock Rallies On Earnings, Musk Comments
Tesla stock edged higher Wednesday, extending a win streak to four sessions ahead of the company's earnings results after the close. Despite their recent rebound, shares remain sharply below their 50- and 200-day lines. Tesla stock closed about 62% off its 52-week high.
Shares of the EV giant surged 7% Thursday morning after the company's strong fourth-quarter results. Tesla earnings advanced 40% to $1.19 a share while revenue grew 37% to $24.32 billion. Earnings topped estimates, while sales fell short of analyst forecasts.
Musk told investors Wednesday that so far in January, Tesla has "seen the strongest orders year-to-date than ever in our history." The Tesla CEO said orders currently are coming in at "almost twice the rate of production" and that is resulting in increased Model Y prices.
"I think there's just a vast number of people that want to buy a Tesla car but can't afford it. And so these price changes really make a difference for the average consumer," Musk said.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares slipped 0.5% Wednesday, snapping a four-day win streak. Shares remain above their 50-day line after strong gains in recent sessions. Still, the stock is around 21% off its 52-week high. Apple will report its quarterly earnings on Feb. 2. AAPL stock traded up 1.6% Thursday.
Microsoft stock dropped 0.6% Wednesday after the company's fourth-quarter earnings results. MSFT stock fell back below its 50-day line. A more decisive retake would be bullish for the stock's prospects, even though shares remain 24% off their 52-week high. Shares were up 1.8% early Thursday.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
