The Dow Jones Industrial Average, Nasdaq composite and S&P 500 began selling off late in the afternoon session after trending higher for most of the day on Tuesday. After briefly turning positive, the Nasdaq traded mildly in negative territory while the S&P 500 reversed slightly lower.
Dow Jones Pares Gains, Nasdaq Leads Downside
After moving steadily higher for most of the entire session, the Dow Jones had a sudden drop late in the session and pared gains to around 0.5%.
Meanwhile, the S&P 500 reversed lower losses and traded down 0.1%. Small caps held some gains, with the Russell 2000 advancing 0.3% before cooling off for a 0.4% loss with 45 minutes left in the regular session. The Nasdaq composite led the downside and declined 0.6%. Elsewhere, oil prices fell 3.6% to $86.17 per barrel.
Oil hit the lowest levels since late January.
5 Nasdaq Stocks To Buy And Watch Now
Volume was higher on the Nasdaq and on the NYSE vs. the same time Monday.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 34103.13 | +190.69 | +0.56 |
| S&P 500 | (0S&P5) | 4296.72 | -0.42 | -0.01 |
| Nasdaq | (0NDQC ) | 13064.48 | -63.57 | -0.48 |
| Russell 2000 | 200.60 | -0.47 | -0.23 | |
| IBD 50 | 29.37 | -0.46 | -1.54 | |
Last Update: 3:12 PM ET 8/16/2022 |
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Tuesday was an important day for the indexes, which all traded around the key resistance level around their 200-day moving averages. This level will either provide an area of support or resistance depending on there the index is trading relative to the position of the line. The Dow Jones regained support at this level for the first time since April of this year.
Meanwhile, the S&P 500 and Nasdaq remain just below this area. Should the indexes be able to retake their 200-day lines, it would be a bullish indicator for the current market uptrend.
Wednesday at 2 p.m. ET, the Federal Reserve will release the minutes from its recent interest-rate policy meeting. At the July meeting, the central bank raised the benchmark interest rate three-quarters of a point for the second time. This has been the most aggressive rate-hike series in more than three decades, in a bid to counteract record inflation.
Inside The Dow Jones: Walmart Leads On Earnings
Boosting the Dow Jones on Tuesday was Walmart, which rose around 5.5% and led the upside among blue chips.
Walmart reported earnings in Tuesday's premarket. Analysts expected America's largest retailer to report Q2 earnings of $1.60 per share on sales of $149.96 billion. The firm announced earnings of $1.77 a share on sales of $152.9 billion also beat views. Prior to today's report, the company reported weak fiscal Q1 results and guidance on May 17. Walmart then followed up with another warning on July 26, saying shoppers have been cutting back on clothing and other discretionary items that carry higher profit margins.
Walmart gapped above its 200-day moving average on Tuesday in very strong volume, a bullish sign. According to MarketSmith, the stock still remains 13% below a 160.97 buy point.
Home Depot also posted strong earnings late Monday. Analysts expected EPS of $4.93 on revenue of $43.3 billion. But Home Depot reported EPS of $5.05 a share on $43.79 billion in sales. Shares held a gain of 4.1% in afternoon trading and also led the upside among blue chips
On the downside, tech giants Apple and Salesforce.com led with losses of 0.8% and 1.2% each.
Automotive Stocks Breaking Out
A handful of stocks broke out on Tuesday including two automotive-related stocks, O'Reilly Automotive and Penske Automotive Group.
O'Reilly broke out above a 748.78 cup-base buy point. The stock held modest gains of 0.6% in afternoon trading however and remained just below the proper entry. Shares are trading higher for their seventh-straight week as the stock powers higher. O'Reilly is also well extended above its 50-day moving average at this time, which could be a cause for concern.
The retail auto parts industry group currently ranks No. 18 out of IBD's 197 groups. This six-month price performance ranking shows significant leadership among these stocks.
Another automotive-related stock, Penske Automotive, broke out above a 121.55 cup-with-handle entry. Shares shot up over 6% higher and traded near the upper edge of their 5% buy zone in afternoon trading. The breakout occurred in average volume.
Follow Rachel Fox on Twitter at @IBD_RFox for more Dow Jones and stock market commentary.
