The Dow Jones Industrial Average soared as Treasury yields plunged. An analyst said arguably the ultimate Warren Buffett stock, Berkshire Hathaway, is offering an attractive entry. Apple fell late as sales declined again. Starbucks soared on earnings.
A few stocks broke out in high volume amid the ebullient action. Tenaris, Afya and Cigna all cleared entries in strong volume. But Vistra broke out of a flat base in weak volume.
Bulls were continuing to charge hard Thursday after Federal Reserve Chair Jerome Powell took a more cautious stance on interest rate increases following yesterday's Fed meeting.
"We've come very far with this rate-hiking cycle," Powell said. "We're proceeding carefully because we can proceed carefully at this time. Monetary policy is restrictive (and) we see its effects."
Investors have taken this as a sign central bankers are done raising rates. Treasury yields retreated as equities rallied. The 10-year yield fell 12 basis points to 4.67%, the 30-year plunged 17 basis points to 4.80% and the 5-year yield skidded 6 basis points to 4.65%.
Friday's jobs report is now key, according to Oanda Senior Market Analyst Edward Moya.
"If Wall Street sees a soft NFP (nonfarm payrolls) report tomorrow, you can kiss the chance of one more Fed rate hike this cycle goodbye," he said.
Nasdaq Jumps As Small Caps Outperform
The tech-heavy Nasdaq powered up 1.8%. EV stock Lucid outperformed as it popped 12.1%. But onetime darling Moderna plunged 6.5% as it posted a sharp loss on waning Covid vaccine demand.
The S&P 500 vaulted 1.9%. Teleflex was a star here as it popped 11.6% on quarterly results.
The S&P 500 sectors all made gains. Real estate and energy performed best on the stock market today. Communication services turned in the slimmest gain.
Small caps gave the bears the bloodiest nose, with the Russell 2000 soaring 2.6%. Growth stocks lagged the major indexes though, with the Innovator IBD 50 ETF falling 0.1%.
Dow Jones Today: Apple Earnings Beat But Sales Fall
The Dow Jones Industrial Average kept pace with the other major indexes. It soared 565 points, or 1.7%.
Apple stock rallied ahead of its quarterly report after the close, finishing up 2.1%. The stock managed to retake the 50-day moving average, though this would be a very risky entry. AAPL the fell in extended trading after it posted results.
Apple earnings came in at $1.46 a share on sales of $89.5 billion. Analysts had expected them to rise 8% to $1.39 per share and had seen revenue slipping around 1% to $89.3 billion.
Sales fell for a fourth consecutive quarter. Services revenue came in above views, iPhone revenue was inline while Mac revenue was lower than expected.
In the same quarter last year Apple had earned $1.29 a share on sales of $90.1 billion.
Nike and Walgreens Boots Alliance were the best-performing stocks on the Dow Jones today, both rising 4.2%.
Only Travelers ended the day in negative territory, the insurance giant falling 0.2%.
Ultimate Warren Buffett Stock Offers 'Attractive Entry'
Berkshire Hathaway is getting set to post third-quarter earnings on Saturday. And a Wall Street analyst says the stock is currently offering a viable entry point.
CFRA analyst Catherine Seifert said in a research note that the stock is attractively priced.
"At current levels, Berkshire's Class B shares trade at 17x our 2025 operating EPS estimate of $19.95 and at 18x our 2024 EPS estimate of $18.85, a 20% discount to the three-year average forward multiple of 22.6x, offering investors an attractive entry point to acquire the shares," she said.
Seifert believes investors should take into account the Buffett-led firm's Occidental Petroleum strategy, its overall acquisition strategy and its plans for share buybacks.
Berkshire Hathaway finished the session with a 1.5% gain. However, it is currently trading below its 50-day moving average, a bearish sign.
Nevertheless, it is off consolidation lows as it continues to form a flat base with an ideal buy point of 373.34, MarketSmith analysis shows.
Starbucks Earnings Spark Caffeine High
Starbucks stock came to a boil after the coffeehouse giant served up a beat on the top and bottom lines in its latest quarterly report.
It gapped up through its 50-day moving average and for a spell also retook its 200-day line. It ultimately closed just below the latter benchmark as it soared 9.5%. The fact the 50-day line remains below the 200-day gives its chart a longer-term bearish look.
Other earnings movers included Qualcomm, which jumped 5.8% after topping views for its fiscal fourth quarter.
Palantir Technologies also impressed, soaring as much as 20.4% after the company bested Q3 earnings views. It closed up 17.97%. It remains shy of a consolidation entry of 20.24.
However, SolarEdge closed well off session lows but still down 4% in mammoth volume after the firm missed revenue expectations and served up disappointing guidance.
Outside Dow Jones: 3 Stocks Test Entries
Now is the time for investors to be looking out for stocks staging breakouts. Here were some of the notable movers today.
Tenaris is in a buy zone after it cleared an entry with a 34.20 buy point. It popped after revenue topped estimates. Overall performance is strong here, which is reflected in its IBD Composite Rating of 94.
Afya cleared a cup-base entry of 17.17 in above-average volume, closing a penny below the entry. The stock is in the top 7% of issues in terms of price performance over the past 12 months. Earnings are due in 11 days.
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.
Cigna cleared a handle entry of 316.14. The managed health care stock popped after it beat earnings views.
Please follow Michael Larkin on X, formerly known as Twitter, at @IBD_MLarkin for more analysis of growth stocks.
