The stock market bounced off lows at midday Friday as the S&P 500 reversed higher and the Nasdaq pared losses. Transportation stocks fell after Bank of America downgraded multiple stocks.
The Nasdaq composite reduced its loss to 0.5% as it still has a tentative hold on its 50-day moving average. After Wednesday's sharp gap-down, the index held above its 50-day average. On Thursday, the Nasdaq reversed higher around the 50-day line.
The S&P 500 rose 0.2%. While the S&P has held above the 50-day average since March 18, it faces another test at the 200-day moving average. At midday, the index was slightly above the line.
The Dow Jones Industrial Average, up 0.7%, is finding support at the 50-day line this week.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 34561.44 | +64.93 | +0.19 |
| S&P 500 | (0S&P5) | 4478.23 | -2.92 | -0.07 |
| Nasdaq | (0NDQC ) | 13710.03 | -178.79 | -1.29 |
| Russell 2000 | 197.61 | -2.50 | -1.25 | |
| IBD 50 | 36.80 | +0.10 | +0.27 | |
Last Update: 10:04 AM ET 4/8/2022 |
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After Wednesday's close, IBD lowered its market outlook to "uptrend under pressure." Some leading stocks came under selling, while some techs saw renewed weakness.
Techs Lead Stock Market Losses
Volume today fell on the Nasdaq and the NYSE compared with the same time on Thursday.
Technology Select Sector SPDR fell 1.3% in one of the deepest drops among S&P sector ETFs. Semiconductors and some software industry groups were among the day's weakest.
The yield on the 10-year Treasury note rose 3 basis points to 2.68% and is up more than 30 basis points recently on hawkish talk from Fed officials.
LPL Financial broke out of a cup-with-handle base in heavy trading. The stock jumped past the 191.08 buy point and is in buy range to 200.63. JMP Securities upgraded the financial advisory firm to outperform from market perform on Thursday.
Shell rose above the 56.23 buy point of a flat base in active trading. The stock is in buy range to 59.04. Energy Select Sector SPDR rose 2.3% to lead all S&P sector ETFs. U.S. crude rose 1% to $97.01 a barrel.
Robinhood Markets slid 7.1% after Goldman Sachs downgraded the online brokerage to sell from neutral. Goldman also cut the price target to 13 from 15. Robinhood stock was already trading near all-time lows, closing at 12.07 Thursday. After rallying a few days after its July 2021 IPO, the stock has been in a long descent and is below the IPO price of 38 a share.
Airfreight, trucking and railroad industry groups fell more than 1% each, and SPDR S&P Transportation fell 0.5%, on pace for an eighth straight decline.
Transportation Sector Lower After Analyst Downgrades
Bank of America downgraded nine transportation stocks today, citing "deteriorating demand outlooks and rapidly falling freight rates." BofA downgraded UPS to neutral from buy. The stock fell 3% to the lowest point since Oct. 13.
It also downgraded Union Pacific and Canadian Pacific to neutral from buy, and several trucking and related companies, including Saia, ArcBest and container lessor Triton International. Triton, cut to underperform from buy, sold off 9% in huge volume. The stock fell to its 200-day line after breaking below the 50-day on Wednesday.
But C.H. Robinson Worldwide rose 1.7% after JPMorgan Chase upgraded the stock to overweight from neutral and lifted the price target to 117 from 91. The logistics company broke out of a cup-with-handle base March 25, but soon triggered the 7%-8% sell rule. The stock is now rebounding from its 50-day line.
IBD 50 Outperforms Stock Market
The Innovator IBD 50 ETF rose 0.3%. Fertilizer, energy and food-related stocks led the IBD 50. Regeneron Pharmaceuticals climbed to a new high and is extended from a 673.96 buy point.
Tesla was the worst-performing IBD 50 stock, down 1.4%. Late Thursday, the EV maker launched its Texas factory with a handful of deliveries. Tesla's Shanghai factory remains closed due to a surge in Covid cases. Also, China regulators said Tesla needs a safety-related software fix for a semiconductor component on more than 127,000 Model 3s.
