The Dow Jones futures Industrial Average rallied Friday, as China's central bank unexpectedly cut a key interest rate overnight to support its struggling economy. Companies with strong China exposure, including Microsoft, Apple, Nike, were leaders in early trade. And retailer Ross Stores crashed after reporting disappointing first-quarter earnings and sales results, along with weak guidance.
Applied Materials, Deckers Outdoor and Palo Alto Networks also reported earnings late Thursday. And Deere and Foot Locker released earnings Friday morning.
AMAT shares rose nearly 1% while Deckers jumped 16%. Palo Alto surged around 12% as Ross Stores plummeted 22%. And Deere shares declined almost 7% while Foot Locker jumped 7%.
Electric-vehicle giant Tesla traded up around 1% Friday morning. Elsewhere, Dow Jones tech leaders Apple and Microsoft rose more than 1% each in today's stock market.
Amid a young and struggling stock market rally, Dow Jones leaders Chevron and Merck — along with Northrop Grumman, Eli Lilly, Exxon Mobil and World Wrestling Entertainment — are among IBD's top stocks to watch for Friday.
Microsoft is an IBD Leaderboard stock. Merck is on IBD SwingTrader. And Eli Lilly and Merck were featured in this week's Stocks Near A Buy Zone column.
Dow Jones Today: Treasury Yields, Oil Prices, China Rate Cut
After Friday's open, the Dow Jones Industrial Average moved up 0.55%, while the S&P 500 rose 0.9%. The tech-heavy Nasdaq composite advanced 1.2% in morning trade.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust rose 1.2%. The SPDR S&P 500 ETF gained 0.9%.
The 10-year Treasury yield ticked higher to 2.87% Friday morning after ending Thursday at 2.85%. The 10-year Treasury yield remains off last week's 52-week high of 3.16% after falling seven of the last nine trading days. Meanwhile, U.S. oil prices inched higher, with West Texas Intermediate crude trading just above $112 a barrel.
Overnight, the People's Bank of China cut its benchmark rate for loans of five years or more from 4.6% to 4.45%, as the central bank attempts to strengthen its slowing economy.
Stock Market Rally Attempt
The major stock indexes posted more disappointing action Thursday, as the Dow Jones industrials, Nasdaq composite and S&P 500 finished with modest losses. The Dow undercut its prior low from May 12, while the S&P 500 and the Nasdaq stopped short of that rally-ending violation. Still, the market's unpredictable behavior has the young uptrend on the ropes.
Thursday's The Big Picture column commented, "Broadcom's recent action underscores the danger in the current stock market. On Tuesday, AVGO shares jumped more than 4% to retake the 50-day moving average and break out past a downward-sloping trend line, which triggered an early buy signal. One day later, however, the stock dived more than 6% to break down through the 50-day line. On Thursday, the stock broke its long-term 200-day line, falling more than 4%."
If you're new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one key to the investment guidelines. IBD offers a broad range of growth stock lists, such as Leaderboard and SwingTrader.
Investors also can create watchlists, find companies nearing a buy point, or develop custom screens at IBD MarketSmith.
Five Dow Jones Stocks To Watch Now
Dow Jones Stocks To Watch: Chevron, Merck
Dow Jones leader and energy giant Chevron continues to build a flat base that has a 174.86 buy point, according to IBD MarketSmith chart analysis. Shares stemmed their slide Thursday around their 50-day line. CVX shares traded up 1.1% Friday.
CVX stock boasts a perfect 99 IBD Composite Rating, per IBD Stock Checkup. Investors can use the IBD Composite Rating to easily gauge the quality of a stock's fundamental and technical metrics.
Merck, a Dow Jones and IBD SwingTrader stock, is holding in a buy range above a cup-with-handle's 89.58 buy point, even as shares inched lower Thursday. The 5% buy area goes up to 94.06. MRK shares were slightly higher Friday morning.
The stock's relative strength line hit more new highs, a strong indicator of stock market outperformance during the current stock market correction.
Four Top Growth Stocks To Watch In The Current Stock Market Rally
Stocks To Watch: Northrop Grumman, Exxon, Eli Lilly, WWE
Wednesday's IBD Stock Of The Day, Northrop Grumman, is building a cup with handle with a 477.36 buy point, according to IBD MarketSmith chart analysis. The stock is back below its 50-day line after Thursday's 1% fall. NOC stock was up 0.3% Friday morning.
Energy giant Exxon Mobil is just above a cup-with-handle's 89.90 buy point, falling 1.6% Thursday. Shares are in the 5% buy area that goes up to 94.40. XOM shares rose 1% Friday.
Pharmaceutical giant Eli Lilly rose 0.7% Thursday. Shares of the IBD Leaderboard stock are finding support around their 50-day moving average line and are approaching a flat base's 314.10 buy point. Eli Lilly shares were up 1% Friday.
World Wrestling Entertainment is one of the top stocks to watch after closing Thursday right above its 50-day line. A decisive retake of this level would be bullish for the stock's immediate prospects. WWE shares are forming a flat base with a 63.81 buy point, according to IBD MarketSmith chart analysis. Shares were up 0.4% early Friday.
Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live
Tesla Stock
Tesla stock inched lower Thursday, adding to Wednesday's sharp losses. Shares looked to recover from those losses Friday morning, trading up around 1%. Shares remain sharply below their 50- and 200-day moving averages.
The stock traded as high as 1,243.49 on Nov. 4 and is about 43% away from that all-time high.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares sold off another 2.5% Thursday. The stock is far below its long-term 200-day line and about 25% off its 52-week high. Apple shares moved up 1.4% Friday.
Software leader Microsoft declined 0.4 Thursday, falling for a second straight day. MSFT shares are sharply below their 50- and 200-day lines. The stock closed around 28% off its 52-week high. Microsoft stock gained 1.5% Friday.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
