The Dow Jones Industrial Average ended the day at highs as stocks gained. Tesla CEO Elon Musk mocked a lawyer on Twitter as the stock rocketed amid record profits. Leaderboard stock United Rentals was a big earnings winner. Microsoft was a top blue chip but Bed Bath & Beyond collapsed.
Meanwhile, a trio of noteworthy names were among stocks passing buy points. Plains GP, Arcelor Mittal and PulteGroup all tested entries.
Stocks were boosted by the latest GDP data. The Commerce Department reported Q4 GDP slowed to 2.9% annualized growth, higher than the expected 2.7% growth vs. Q3 growth of 3.2%. The PCE price deflator came in notably below consensus views, up 2.1% vs. the consensus estimate for a 2.6% rise.
Nasdaq Shines, Small Caps Lag
The Nasdaq was the strongest of the major indexes as it gained 1.8%. China stock Pinduoduo excelled as it jumped 8.5%.
The S&P 500 added 1.1%. Seagate Technology was strong, flying 10.9% on earnings.
The S&P 500 sectors were nearly all positive. Energy and consumer discretionary were the best performers, while consumer staples was the only loser.
Small caps lagged, but the Russell 2000 still squeezed out a 0.7% gain.
Growth stocks also jumped, with the Innovator IBD 50 ETF finishing up 1.4%.
Dow Jones Today: Microsoft Shines
The Dow Jones Industrial Average reversed higher as it jumped 206 points, or 0.6%
Salesforce ended up the top performer on the Dow Jones today as it popped 5.7%.
Microsoft stock also had a good session as it rose 3.1%. This allowed it to reclaim the key 50-day moving average, MarketSmith analysis shows.
IBM had the the toughest time as it fell 4.5%. Merck drooped 1.6%.
Tesla Stock Soars; Elon Musk Mocks Lawyer
Tesla was rocketing Thursday afternoon after the firm posted record profits late Wednesday. It ended the day up 11%.
The stock gapped up through its 50-day moving average, which would be a very aggressive buy point given the stock remains below its 200-day line.
TSLA stock was boosted after earnings jumped 40% to $1.19 per share while revenue grew 37% to $24.32 billion. Earnings topped estimates, though sales missed some estimates.
Analysts were mixed on the results, but investors reacted positively to Musk's statement during the earnings call that the firm is seeing its "strongest orders year to date" in the company's history. It expects to deliver about 1.8 million vehicles this year.
It seems the firm's positive results had put the firm's flamboyant CEO in a good mood as he had a joke at the expense of a legal opponent.
"Changed my name to Mr. Tweet, now Twitter won't let me change it back," Musk tweeted.
He made the faux pas in reference to lawyer Nicholas Porritt, who is representing shareholders suing him over 2018 tweets about taking Tesla private. He accidentally called Musk "Mr. Tweet" during the trial on Monday.
BBBY Stock Sinks On Debt Worries
Bed Bath & Beyond stock cratered after the firm warned it does not have enough cash to pay its debts.
Trading was briefly halted after the firm said it has defaulted on its credit line with JPMorgan Chase.
The firm said in a new securities filing that it lacks "sufficient resources to repay the amounts under the Credit Facilities and this will lead the Company to consider all strategic alternatives, including restructuring its debt under the U.S. Bankruptcy Code."
The company owes $550 million under an asset-backed loan with JPMorgan and a further $375 million to lender Sixth Street. It also owes almost $1.2 billion in unsecured notes.
In the filing the firm warned it "has concluded that there is substantial doubt about the Company's ability to continue as a going concern for the next 12 months."
BBBY, which became infamous as a meme stock alongside AMC Entertainment and GameStop ended the session down 22.2%.
Leaderboard Stock Flexes Muscles On Earnings
Another stock soaring on earnings was Leaderboard name United Rentals, which rose on quarterly results.
URI built on early gains as it popped 10.1%, pulling further away from a buy zone. It is extended past a 368.04 buy point.
The stock was boosted after the company reported earnings and initiated a quarterly dividend of $1.48 per share. It also announced plans to buy back $1 billion worth of stock this year.
Quarterly profit increased 32% to $9.74 per share. Revenue rose 19% to $3.3 billion.
United Rentals also raised revenue guidance for 2023. URI now sees revenue of $13.7 billion to $14.2 billion, the midpoint slightly ahead of the $13.46 billion consensus.
Chevron Pops Amid Buyback; XOM Passes Entry
Chevron stock gapped up in above-average volume. It ended the day up 4.9% but remains below a flat-base entry of 189.78.
Shares vaulted after Chevron announced a $75 billion share buyback. The firm also said it will boost its dividend payout by 9 cents to $1.51 per share. Chevron is getting set to post its latest earnings report Friday morning.
Its great rival Exxon Mobil rose 4%, jumping into a buy zone above a 114.76 flat-base entry. But Exxon is a risky purchase because the firm is getting set to post earnings Tuesday.
An approach highlighted by Investor's Business Daily is to use options as a strategy to reduce risk around earnings. It's a way to capitalize on the upside potential of a stock's move around earnings, while reducing the downside risk.
Futures: Tesla Drives Rally To Big Test, Intel Dives Late; Inflation Report Due
Energy Stock Among Breakouts
Energy transport play Plains GP broke out of a cup base with a 13.51 entry. Volume was weak, however.
Through its subsidiary Plains All American Pipeline it operates in two segments, crude oil and natural gas liquids. Analysts expect annual EPS to explode 458% to $1.73 in fiscal 2022 and to grow by a further 38% to $2.38 in 2023.
The stock was featured in today's MarketDiem newsletter.
ArcelorMittal cleared a cup-with-handle buy point of 31.82, best viewed on its weekly chart. The relative strength line is looking mighty.
Big Money has been snapping up the steel stock of late, with its Accumulation/Distribution Rating coming in at A-.
Homebuilders have been strong of late, and Pulte tested a cup-with-handle entry of 52.38. The RS line is at highs.
Earnings are due in the next five days, however, so it would be prudent to keep an eye on this stock rather than taking action now.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more analysis of growth stocks.
