The Dow Jones Industrial Average fell Wednesday ahead of the Federal Reserve's rate hike decision and Fed Chair Jerome Powell's subsequent comments. Meanwhile, retailer GameStop soared as much as 53% on a surprise profit before trimming gains.
The Federal Reserve's two-day meeting concludes Wednesday. The Federal Reserve may be reluctant to raise its target interest rate as rescue attempts for several U.S. regional and community banks remain less than certain. (For the latest coverage of the market, visit our Stock Market Today page.)
As of Tuesday, markets had priced in 88% odds of a quarter-point rate hike at the conclusion of Wednesday's Federal Reserve meeting. That would lift the Fed's key interest rate to a range of 4.75% to 5%. Still, Goldman Sachs economists are sticking by their prediction that the Fed will pause rate hikes "because of stress in the banking system."
The Fed's rate hike decision is due out at 2 p.m. ET, with Powell's comments expected at 2:30 p.m. (For our latest coverage of the market's action, go to our Stock Market Today page.)
Federal Reserve Rate Hike Odds Grow As Bank-Crisis Fears Ebb; S&P 500 Rises
Earnings Results: GameStop, Nike
Array Technologies, GameStop, Nike, Ollie's Bargain Outlet and Winnebago were earnings movers Wednesday morning.
Array shares rose 3.5%, while NKE stock declined nearly 1% in early morning trade. OLLI stock jumped 13%. And Winnebago shares rose 6% in morning action.
GameStop blew away expectations for fourth-quarter earnings late Tuesday, reporting its second positive period in the last 12 quarters. Adjusted earnings leapt to 16 cents per share vs. a 47-cent loss last year. Net sales dipped 1.2% to $2.226 billion. Analysts expected GameStop to report a loss of 13 cents per share on a 3.2% drop in revenue to $2.18 billion.
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Stock Market Today
Chip leader Nvidia rose more than 2% after a number of price-target hikes amid the company's 2023 GPU Technology Conference. Electric-vehicle giant Tesla traded 0.3% lower Wednesday. Dow Jones tech giants Apple and Microsoft were mixed after today's stock market open.
Chip leader Advanced Micro Devices, IBD SwingTrader stock Meta Platforms and IBD Leaderboard Palo Alto Networks — as well as Dow Jones stocks Nike and Salesforce — are among the top stocks to watch in the ongoing stock market correction.
Palo Alto is an IBD Leaderboard stock. Microsoft was featured in this week's Stocks Near A Buy Zone column. And Meta is an IBD SwingTrader stock.
Dow Jones Today: Oil Prices, Treasury Yields
After Wednesday's opening bell, the Dow Jones Industrial Average fell 0.1%, and the S&P 500 lost 0.15%. The tech-heavy Nasdaq composite move down 0.2% in morning action, with Google-parent Alphabet down more than 1%, at the bottom of the list.
Among U.S. exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust fell 0.15% and the SPDR S&P 500 ETF moved down 0.1% early Wednesday.
The 10-year U.S. Treasury yield bounced to 3.6% Tuesday. On Wednesday, the 10-year added to those gains, ticking higher to 3.62% ahead of the Fed rate decision.
U.S. oil prices paused after Tuesday's gains pushed West Texas Intermediate back above $69 a barrel. WTI futures traded down 0.6% early Wednesday, just above $69 a barrel, ahead of the Energy Information Administration's weekly oil inventories.
Stock Market Correction
On Tuesday, the Nasdaq composite climbed 1.6%, while the S&P 500 rose 1.3%. The Dow Jones Industrial Average added 1%.
Tuesday's Big Picture column commented, "Leaderboard is lightly invested ahead of Wednesday's policy statement. But the action in individual growth stocks has improved quite a bit. So there should be ample opportunity to increase exposure, especially if market conditions continue to improve. Until the market proves itself more, exposure should be kept between 0% and 20%."
Now is an important time to read IBD's The Big Picture column amid the ongoing stock market correction.
Five Dow Jones Stocks To Buy And Watch Now
Dow Jones Stocks To Watch: Nike, Salesforce
Since bottoming on Oct. 3, Nike shares have rallied as much as 59% to their recent high at 131.31. Now the stock is consolidating within a flat base that offers a 131.41 buy point, according to IBD MarketSmith pattern recognition. NKE stock moved down nearly 1% early Wednesday after the company's earnings results.
Following Tuesday's advance, the stock bullishly regained its 50-day moving average, a key benchmark. The relative strength line is also holding up well during the rapidly developing stock market correction.
In recent weeks, Dow Jones leader Salesforce showed big upside strength after strong fourth-quarter results. The stock is now above a 178.94 cup-with-handle entry after last week's big gains. Still, the market is in a correction, so investors should avoid new purchases until the market environment improves. CRM stock moved down 0.1% early Wednesday.
3 Top Growth Stocks To Watch In The Stock Market Correction
Top Stocks To Watch: AMD, Meta, Palo Alto
Advanced Micro Devices broke out past an 89.04 buy point in a flat base last week and has a solid 8% cushion above the entry despite two straight days of losses. The 5% buy range topped out at 93.49. AMD stock fell 0.2% Wednesday morning.
Backstory: In early February, the chipmaker reported stronger-than-expected data center chip sales in the fourth quarter. But AMD tempered that news with a soft outlook for the current period.
Backstory: Like social media rivals, Meta is struggling due to a sharp reduction in advertising revenue as clients squirm over macroeconomic concerns, recession fears and higher interest rates. This is happening as it spends billions of dollars on a risky bet to build the "metaverse," a virtual reality world that has yet to take hold.
IBD Leaderboard stock Palo Alto Networks broke out past a cup-with-handle's 192.94 buy point during Tuesday's 2.7% advance. The buy area runs up to 202.59. PANW stock traded down 0.2% Wednesday.
Backstory: On Feb. 21, the cybersecurity giant announced good results for the January-ended quarter that saw earnings hit $1.05 a share, up 81% vs. a year earlier, on a 26% jump in revenue to $1.7 billion.
Learn How To Time The Market With IBD's ETF Market Strategy
Stocks To Watch In Stock Market Correction
These are four top stocks to watch in today's stock market, including two Dow Jones leaders.
| Company Name | Symbol | Correct Buy Point | Type Of Buy Point |
|---|---|---|---|
| Meta Platforms | 197.26 | Flat base | |
| Nike | 131.41 | Flat base | |
| Palo Alto Networks | 192.94 | Cup with handle | |
| Salesforce | 178.94 | Cup with handle |
Source: IBD Data As Of March 21, 2023
Join IBD experts as they analyze leading stocks in the current stock market correction on IBD Live
Tesla Stock
Tesla stock surged 7.8% Tuesday, extending its bullish rebound from its 50-day moving average. Shares closed Tuesday around 49% off their 52-week high.
TSLA stock turned down 0.3% Wednesday morning, as it still looked to extend Tuesday's rise.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares rose 1.2% Tuesday, adding to Monday's 1.55% rally. Shares closed at their highest level since Sept. 12. AAPL rose 0.3% Wednesday.
Microsoft shares broke out above a flat base's 276.86 buy point Friday. But the stock gave up that entry during this week's losses. MSFT stock fell 0.2% early Wednesday.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
