The stock market held onto small afternoon gains Tuesday to finish the day up slightly. The Bank of Japan shocked investors, lifting the top end of its 10-year government bonds.
The S&P 500 edged up 0.1% while the Nasdaq was unchanged. The Dow Jones Industrial Average rose 0.3%. The Russell 2000 small-cap index showed the most strength, up 0.5%. The Dow is the only index holding above its 50-day moving average.
The tech-heavy Nasdaq 100-tracking Invesco QQQ trust ETF gave back 0.1%.
Volume on the NYSE and Nasdaq was lower vs. the same time on Monday, as investors are getting into the holiday mood.
Crude oil gained 0.8% to $75.98 per barrel. The Energy Select Sector SPDR ETF popped 1.5%. On the flip side, natural gas plunged 8.7% and is trading at $5 per million British thermal units.
Bitcoin futures regained 1.9% to $16,815.
The 10-year Treasury note yield edged up 10 basis points to 3.69%. Bonds have come under pressure as the yield curve steepens, reversing after rallying on lower CPI numbers.
Bond Yield Surprise
Investors were taken aback by the Bank of Japan's flexible 10-year government bond policy.
The BOJ said it would allow the top end of the bond yield to rise to 0.5%, from 0.25%. The move dropped the U.S. dollar versus the Japanese yen, adding to ongoing concern of a global recession.
European markets were mixed, with the German DAX and Paris CAC 40 losing less than a point. However, the London FTSE 100 inched up 0.1% to close out the day.
Odds for a 25-basis-point hike by the U.S. Federal Reserve at the February meeting stand at 69%. That would take the yield to the 4.5%-4.75% range. Meanwhile, 31% of analysts are looking for a 50-basis-point hike, according to the CME FedWatch Tool.
Stock Market: Oil Services Stock Leads, Food Stock Drops
Oil services stock SLB gained 3.9% in light volume as energy stocks rose along with crude oil prices. The stock is an S&P 500 leader today.
SLB shares are back in the 5% buy zone of a cup base with a 49.93 buy point.
Moderna clawed back to a 5.9% gain after three down days.
The stock pulled back on Dec. 15 after breaking out above the 21-day line. It extended above the 5% buy zone of a cup-with-handle base with a 188.75 buy point, and then turned lower. It is back in the 5% buy zone, which stretches to 198.19.
General Mills dropped 4.6% and gapped down, despite a positive fiscal Q2 2023 earnings report. The packaged-food purveyor beat EPS and sales estimates, and raised its guidance for the full fiscal 2023 year. But it cited inflation and supply-chain issues as the largest factors impacting 2023.
The stock pulled back after being extended from a flat base with an 81.34 buy point. Shares are finding resistance at the 21-day exponential moving average.
Stock Market Today: IBD 50 Movers
The Innovator IBD 50 ETF crept up 0.2%, in line with the major stock market indexes.
Super Micro Computer regained 6.4% in heavy volume after news it will be added to the S&P MidCap 400. The stock rebounded from yesterday's 3% drop, where it found support at its 50-day moving average. Today's move pushed the stock above its 21-day line, creating a support line.
The company ranks first in the Computer-Hardware/Peripheral industry group, which holds the 39th place out of 197 IBD groups.
Catalyst Pharmaceuticals popped 13.4% in heavy volume, and is extended from the 5% buy zone of a cup-with-handle base with a buy point of 16.76.
The biotech agreed to buy the rights to Eisai's epilepsy medicine for $160 million. Piper Sandler liked the news, and raised its price target on Catalyst to 20. The investment bank maintained its overweight rating on Catalyst. Its shares are trading around 18 in today's session.
Arcus Biosciences, the IBD 50's biggest loser today, is down a catastrophic 32.5% in heavy volume. Rival Roche produced superior results over Arcus and Gilead Sciences for its lung cancer treatment.
GILD shares are down a tempered 1.9%. It's also an S&P 500 top loser today.
