The Dow Jones Industrial Average closed higher as Senate Majority Leader Chuck Schumer pushed to get a debt-ceiling deal over the line. Dollar General cratered on earnings. Microsoft rose amid an AI deal with a startup backed by Nvidia. Dell Technologies was halted briefly after earnings were released during the session.
Breakouts were few despite the encouraging index action. Cameco passed a handle entry while Celsius cleared a trendline. Pure Storage rallied past a 32.28 buy point.
The 10-year Treasury yield slipped 3 basis point to 3.61% while the two-year yield fell 5 basis points to 4.35%. Yields slipped after Federal Reserve officials signaled they plan to hold rates steady this month. The odds of a rate hike have been cut dramatically on the CME FedWatch Tool.
Schumer Pushes Debt-Ceiling Bill Despite This Issue
The House passed the debt-ceiling bill Wednesday night, with most Republicans and Democrats backing the legislation.
But there was no time for a victory lap, as the measure now has to clear the upper house. Schumer struck a bullish tone.
"This is the best thing we can do right now for our economy and for American families," the Democratic leader said. "I'm optimistic the Senate is going to get this done, but it will take one more concerted, focused and bipartisan push to get us over the finish line."
But Republican Sen. Lindsey Graham threatened to hold up passage over defense spending.
"I'm tired of having default over my head as a reason to neuter the military at a time we need it the most," Graham (R-S.C.) said on the Senate floor.
Fellow GOP Sen. Susan Collins of Maine was also unhappy about defense spending, which will be capped at $886 billion in 2024 and roughly $895 billion in 2025.
Others opposing certain aspects of the bill include Utah Republican Mike Lee, Kentucky Republican Rand Paul and progressive Vermont Sen. Bernie Sanders.
Nasdaq Pops As IBD 50 Shines
The Nasdaq fared better than the other major indexes, closing up 1.3%. Match was a top performer as it gained 10.2%, though it remains in a deep correction.
The benchmark S&P 500 made a solid gain of 1%. NetApp shined here with an 8.5% lift.
Both the Nasdaq and the S&P 500 made their highest close since August. However, volume was lower on both the NYSE and the Nasdaq, according to early data.
The S&P 500 sectors were almost all positive. Technology and industrials were the top performers. The defensive consumer staples and utilities areas were the only laggards.
Small caps also flexed their muscles, with the Russell 2000 jumping more than 1%. Growth stocks also had a seat at the party, with the Innovator IBD 50 ETF reversing higher to end the session up 1.4%.
Dow Jones Today: American Express, Apple Stock Lift Index
The Dow Jones managed to turn in a gain of 153 points, or 0.5%.
American Express fared best with a lift of 2.6%. Visa was not far behind with a gain of 2.5%.
Apple rallied into the close on the Dow Jones today as it turned in a 1.6% gain. Apple made its highest close since January 2022. The computing play is clear of all its moving averages, MarketSmith analysis shows.
Microsoft Up Amid AI Deal With Nvidia-Backed Startup
Fellow Dow Jones stock Microsoft climbed amid news of another artificial intelligence deal. The software behemoth has inked a deal with CoreWeave that could be worth billions of dollars over multiple years, insiders told CNBC.
Microsoft is to pay a massive sum for cloud-computing infrastructure from the Nvidia-backed startup.
The deal will ensure Microsoft partner OpenAI, which operates ChatGPT, has access to enough computing power.
Microsoft has already rolled out a ChatGPT-enhanced version of its Bing search engine and is also bringing the technology to its Office suite.
Nvidia previously invested $100 million in CoreWeave. Microsoft and Nvidia are seen as two of the key players in the push toward AI.
MSFT stock ended the session up 1.3%, and is well extended. Nvidia fared even better, rising 5.1%. Microsoft is up nearly 39% so far in 2023, while NVDA has a gain of nearly 178% year to date.
Dollar General Earnings Sink Stock; Retailers Mixed
Dollar General surrendered to the bears after a disastrous earnings report. DG stock plummeted 19.6%, making it the worst performer on the S&P 500 today.
Its downward move in gargantuan volume caused it to lose even more ground on the 50-day moving average.
It was a mixed day for retail stocks. Department store play Macy's reversed higher despite missing revenue estimates and slashing its outlook. The stock closed off highs but still rose 1.2%. It remains in a downtrend.
Fellow department store stock Nordstrom jumped after it beat views and finished the session with a strong 4.7% lift.
Dell Earnings Released, Stock Briefly Halted
Dell stock was halted after the firm appeared to release its earnings report early. Its conference call is taking place after the close.
The firm posted EPS of $1.31, a decline of 29% but well clear of analyst views for 86 cents. Revenue fell 20% to $20.92 billion but also came in above views.
The computer hardware stock briefly spiked before reducing its gain to 1.5%. It is currently trading above its 50-day line but failed to retake its 21-day exponential moving average.
Futures Rise: Jobs Report Looms As Tesla Breaks Out
Outside Dow Jones: These Stocks Test Entries
There were surprisingly few breakout despite the strong upward momentum.
Cameco managed to clear a cup-with-handle entry of 29.16 and remains in buy range.
This is a second-stage pattern, which still counts as early stage. Volume was potent on the move, a good sign. The uranium miner has a strong IBD Composite Rating of 93 out of 99. Earnings are seen rising 113% in 2023.
Celsius managed to clear a short trendline near the 130 level. This would be an aggressive entry to the energy drink maker, which is a new member of the prestigious IBD Leaderboard.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more analysis of growth stocks.
