The stock market rallied on cooling inflation, led by Nasdaq composite and small-cap Russell 2000. Indexes remained near session highs in afternoon trading.
The Dow Jones Industrial Average surged 400 points in pre-market hours after this morning's reassuring inflation data raised investors' hopes of a soft landing. The blue chip index is up 1.5%.
The Nasdaq added to the morning's strong gains and is up by 2.5% in the afternoon session. The S&P 500 is up 1.9%. The Russell 2000 posted a strong 2.5% gain. Crude oil rose 1.4% to $91.42 a barrel.
Volume on the Nasdaq was lower by 8.5% compared to the same time yesterday. The NYSE saw stronger volumes by 9.5%. Advancing stocks led decliners by nearly 6-to-1 on the NYSE and by more than 3-to-1 on the Nasdaq.
Inflation and Economic Data
July's consumer prices index print came in at 8.5% compared to June's 9.1% increase. The less volatile core inflation number of 5.9% showed that it grew a fractional 0.3% from June.
The U.S. dollar softened and fell more than 1%, pulling the dollar index to 105.04. The index reached a peak of 108.54 in July after inflation peaked in June and strong employment numbers continued into July.
The Cboe Volatility Index has fallen below the 20 level for the first time since April.
Technology Stocks Surge in Broad Stock Market Rally
The broad rally in technology, consumer discretionary, materials, financials, industrials and communication services saw several blue chip names surge.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 33258.64 | +484.23 | +1.48 |
| S&P 500 | (0S&P5) | 4199.12 | +76.65 | +1.86 |
| Nasdaq | (0NDQC ) | 12800.01 | +307.03 | +2.46 |
| Russell 2000 | 194.93 | +4.76 | +2.51 | |
| IBD 50 | 29.46 | +0.72 | +2.51 | |
Last Update: 12:00 PM ET 7/27/2022 |
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Tech leaders Apple, Amazon.com and Google parent Alphabet rose over 3% in today's trading as 10-year Treasury yields fell 4 basis points to 2.76%.
Tesla shares rose 2.8% after CEO Elon Musk sold $6.9 billion worth of Tesla shares, according to disclosures. The sale may be to complete his acquisition of Twitter. TWTR shares rose 3% today.
Elsewhere, Nikola announced that Michael Locscheller, who is responsible for its Tre battery production, will become the new CEO next year when Mark Russell retires. The EV company retained its production target of 300-500 Tre battery electric trucks after it beat estimates last week.
Shares of Nikola pared gains and met resistance at their 200-day moving average on Monday.
In the finance sector, major banks are rising as the stock market hopes for a lower rate hike by the Fed. Banks are sensitive to rate hikes, and as hopes renew for a soft landing, bank stocks are flying.
Goldman Sachs surged over 10% and is breaking above its 200-day line while JPMorgan broke above its 50-day line.
$52 Billion Stimulus to Chipmakers
The federal Chip and Science Bill has finally been signed. Its $52 billion stimulus package for the semiconductor industry landed as top chip manufacturer Micron warned of cooling demand. Micron's lower capital spending plans drove shares of Applied Materials and Lam Research down sharply yesterday.
After today's inflation report, the Philadelphia Semiconductor Index has risen nearly 3% while the SPDR S&P Semiconductor ETF is set to end a four-day losing streak with a 4% gain today.
Earnings News In Today's Stock Market
Energy drink maker Celsius beat expectations late yesterday. Earnings of 12 cents a share came above FactSet estimates of 8 cents. Revenue of $154 million beat estimates of $148.7 million.
Last week, the stock rallied after PepsiCo announced that it would take a 8.5% stake in the company and join in a distribution pact. Celsius shares are well above their 50-day line and are trading 8% above yesterday's close.
Elsewhere, Wendy's missed revenue estimates with $537.8 million for its Q2, short of estimates by $2 million. The stock is down after the company also cut forecasts for new restaurant growth. The stock continues to form a cup base with a buy point of 21.59 but may test support at its 50-day line.
Earlier, Chipotle Mexican Grill beat earnings estimates. The burrito chain came in with earnings of $9.30 a share, above the expected $9.10, though revenues were $2.21 billion versus estimates of $2.25 billion. Shares traded above their 200-day line and are above a buy point of 1,645.10.
Shares of Disney are up by 3.3% ahead of earnings due later today.
Market Rally Enters Power Trend; These EV Plays Flash Buy Signals
Stock Market Breakouts Today
SunPower is breaking above a buy point of 25.34 in a cup base. The company beat earnings estimates with 3 cents a share on $414 million revenue, compared to estimates of 2 cents on revenue of $362 million for the second quarter.
Graphic Packaging pared gains but remained in the buy zone from a buy point of 23.09 in a cup-with-handle base.
Eastern Bankshares[ticker symb=EBC] are nearing a buy point of 20.74 in a cup-with-handle base. The stock is now above its 200-day line.
Molina Healthcare is in the buy zone from a buy point of 316.01. The stock has formed a double bottom is ranked No. 1 in the managed care industry group.
