The stock market remained near session lows at midday as Treasury yields continued to climb and the IBD 50 was down sharply.
In an erratic session so far, the S&P 500 and Nasdaq composite fell 0.4%. The Dow Jones Industrial Average fell 0.3%. Small caps underperformed, as the Russell 2000 lost nearly 1%.
Volume rose on the Nasdaq and fell on the NYSE compared with the same time on Wednesday. Declining stocks outnumbered advancers by nearly 4-to-1 on the NYSE and by 5-to-2 on the Nasdaq.
The Innovator IBD 50 ETF saw its drop worsen to 2.6% at midday. Amphastar Pharmaceutials was the worst stock on the IBD 50. The biotech plummeted 17% in heavy volume, which caused a sell signal. The stock was dropped from Leaderboard.
Darling Ingredients fell back below the 85.02 buy point of a breakout on Tuesday from a cup-with-handle base. Also in the IBD 50, Eagle Bulk Shipping dipped below its 50-day moving average as shipping stocks continued to sink.
Treasury Yields Up Again
The yield on the 10-year Treasury note rose 2 basis points to 3.05% at midday. The benchmark yield has jumped more than 30 basis points in two weeks.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 32815.73 | -95.17 | -0.29 |
| S&P 500 | (0S&P5) | 4101.15 | -14.62 | -0.36 |
| Nasdaq | (0NDQC ) | 12043.04 | -43.23 | -0.36 |
| Russell 2000 | 186.19 | -1.76 | -0.94 | |
| IBD 50 | 32.58 | -0.71 | -2.13 | |
Last Update: 11:46 AM ET 6/9/2022 |
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Earlier today, the European Central Bank said it intends to raise its key rate by a quarter percentage point. It would be its first rate increase in more than a decade and add the ECB to the list of central banks raising rates to battle inflation.
"The ECB didn't beat around the bush. It actually announced when and by how much it would raise rates," BMO Capital Markets economist Jennifer Lee said in a note. The ECB intends to raise key rates by 25 basis points at the July 21 meeting, and again at the Sept. 8 meeting. "But it left the door open for a 50 bp hike."
The number of U.S. jobless claims jumped to 229,000 from 202,000 the previous week. Economists polled by Econoday had forecast 210,000.
Tesla Climbs On Data, Analyst Upgrade
Electric-vehicle reports came in better than expected today.
Tesla sales in China improved sharply from April, when production was shut down due to a Covid lockdown. News reports said Tesla's China operations are back to full strength. Tesla stock rose 3% in heavy volume.
UBS upgraded Tesla to buy from neutral today, saying the company's "operational outlook is stronger than ever."
Analyst Patrick Hummel cited a record-high order backlog and the ramp-up of the company's two new gigafactories. After a Q2 dip, auto gross margin should top 30% on pricing and innovation. In addition, Hummel noted a "structural competitive edge in key supply chains, resulting in superior growth and profitability." UBS raised its estimates of Tesla's EPS growth for the next three years to 40%, or $28 a share in 2025.
China-based Nio beat first-quarter earnings estimates early Thursday and implied a big jump in June deliveries as the country's Covid lockdown winds down. Nio expects Q2 deliveries of 23,000-25,000 vehicles, which would mean an increase of 5%-14% vs. a year earlier, but down slightly from Q1.
Nio shares fell nearly 7%, breaking a rally that took the stock up more than 23% from May 27.
Market Rally Suffers Big Losses With Key Inflation Data Due
Stock Market Gets More Retail Earnings
In retail, Five Below pared its loss to 3.5%. The company's April-quarter sales rose 7% to $639.6 million but missed forecasts. Same-store sales fell 3.6%, and management cut its full-year profit guidance.
Several analysts, including those at Wells Fargo and Citigroup, cut their price targets on Five Below. The stock has been rebounding from its May lows but remains miles away from any clear buy point.
The price of U.S. crude oil fell 0.4% to $121.66 a barrel. It wasn't much change, but helped the Energy Select Sector SPDR fall 1.2% to the day's worst S&P sector performance.
