The Dow Jones Industrial Average and other indexes closed lower as the Nasdaq composite and S&P 500 fell below important levels. Nvidia rose even as fellow Magnificent Seven names Tesla and Meta Platforms lagged. Meanwhile, a Bill Ackman stock fell on the stock market today.
Indexes in general added to an underwhelming Santa Claus Rally period so far. The Dow Jones average closed with a 1% loss. Laggards included Johnson & Johnson and Merck, both down about 1% and in a deep slump.
The Nasdaq composite closed off session lows but still lost 1.2% for the day. It fell below its 21-day exponential moving average.
Stock Market Today: Energy Shines As Most Sectors Slip
The S&P 500 fell 1.1% and fell below its 50-day moving average. EQT was a standout in the index, popping more than 5% in active trading. The stock broke out above a trendline entry around 45.
Embattled computer server stock Super Micro Computer struggled, falling about 4%. Its November-early December rebound has faded.
The S&P 500 sectors were all lower at the close. Volume was higher on the New York Stock Exchange and the Nasdaq from Friday's totals, based on early data. Declining stocks outnumbered advancers by 8-5 on the NYSE and Nasdaq, according to FactSet.
Small caps also ended well off lows, though the Russell 2000 still lost 0.8%. The Innovator IBD 50 ETF fell 2% and also closed below its 50-day moving average.
Treasury yields were mostly lower. The 10-year Treasury note fell seven basis points to 4.55%.
3:08 p.m. ET
Bill Ackman Stock Nike Lags
Even the best investors can find themselves under water. And that is the case at the moment for hedge fund titan Bill Ackman, at least with one holding. He currently finds himself down more than 7% on the 16.28 million shares his fund holds in sportswear giant Nike.
His firm Pershing Square Capital Management currently lags its average purchase price of 82.41, according to HedgeFollow.
Investor's Business Daily recommends selling issues that fall more than 7% below the purchase price.
"To preserve your hard-earned money, I think a 7% or 8% loss should be the absolute limit," IBD founder William J. O'Neil said in "How To Make Money In Stocks." "The average of all your losses should be less, perhaps 5% to 6%, if you're strictly disciplined and fast on your feet."
Nike stock is currently trading below its 50-day moving average, which itself is on a downward path. This is another red flag.
The Dow Jones stock is on track to fall an eye-watering 31% in 2024. This is a huge loss considering the fact the firm has a market cap of $112 billion.
Ackman runs a highly-concentrated portfolio, with holdings in nine companies. This comes to 10 positions in total, as his firm owns two classes of Alphabet stock, the GOOGL shares which give the holder one vote per share and the nonvoting GOOG stock.
1:57 p.m. ET
Bitcoin Falls Again; MicroStrategy, Coinbase Stumble
Bitcoin surged to amazing heights following the reelection of Donald Trump, as high as $106,490.10 per coin.
While it was off 24-hour lows, the cryptocurrency was down to less than $94,000 per coin, according to Coindesk. In fact, it fell all the way to $91,516.39 before paring some losses. This is a decline of just over 14% from its highs.
Crypto exchange stock Coinbase confirmed a sell signal by losing more ground on its 50-day moving average. It has lost more than a quarter of its value since hitting 349.75 on Dec. 6.
MicroStrategy lagged with a drop of about 4% and is now below the 50-day moving average. It disclosed it had sold more than 592,000 shares and bought more bitcoin. It purchased 2,100 of the cryptocurrency tokens from Dec. 23 to Dec. 29.
Other cryptocurrency stocks were also struggling. Bitcoin mining play Riot Platforms skidded more than 3% and MARA, formerly known as Marathon Digital, lost over 4%.
Magnificent Seven: Tesla Lags, Nvidia Outperforms
The so-called Magnificent Seven stocks were struggling despite coming off lows.
Tesla skidded more than 2%. However, it remains above its 21-day exponential moving average, according to MarketSurge analysis.
Overall performance is stout, with its IBD Composite Rating coming in at 93 out of 99. Heavy institutional buying of late is reflected in its Accumulation/Distribution Rating of A-.
Amazon.com, Microsoft and Apple also declined around 1% each. But they were comfortably off lows for the day in afternoon trading.
Meta Platforms fell nearly 1% on the stock market today. It is testing buyers at its 50-day moving average and is below a flat-base entry of 602.95. A member of the prestigious IBD Leaderboard list of stocks, Meta remains on track for a gain of more than 68% this year.
Google parent Alphabet was fractionally lower. But Nvidia outperformed as it rallied nearly 2%. The AI stock is just below its 50-day line but remains up more than 180% in 2024.
12:28 p.m. ET
Nasdaq, NYSE Announce Jimmy Carter Move
Americans are mourning the death of Jimmy Carter, who served as president from 1977 until early 1981.
Following his passing at the age of 100, the New York Stock Exchange and the Nasdaq observed his death with a moment of silence ahead of Monday's open. Both exchanges will close on Jan. 9 to observe a National Day of Mourning for the former leader.
Carter's presidency was marked by runaway inflation, an unfortunate economic issue whose reemergence has taken a toll on the country today.
But following his exit from office, Carter won acclaim for his work as a humanitarian.
Stock Market Today: 3 Issues Strong Near Entries
While indexes were lower, investors have to be prepared for every eventuality. Here are a few issues near entries for your watchlist.
Boston Scientific has formed a flat base with a 91.93 buy point. It has been getting support at the 50-day moving average.
Earnings have been ramping up of late, with EPS growing an average 21% over the past three quarters. This is below the 25% growth sought by those following IBD investing principles. EPS is expected to grow by a further 14% next year.
Institutions have been standing pat on Boston Scientific stock of late, with its Accumulation/Distribution Rating sitting at C. Nevertheless, 57% of shares are currently held by funds, and fund ownership has risen for the past eight quarters.
Adtalem Global Education is nearing a flat-base entry of 92.93. It is getting support at the 21-day exponential moving average, a positive.
Earnings performance is key for Adtalem, with its EPS Rating a muscular 97 out of 99. Big Money has also been snapping up the stock lately, netting it an Accumulation/Distribution Rating of B+. In total, 72% of its stock is held by funds, according to MarketSurge data.
The company operates educational institutions, including the American University of the Caribbean School of Medicine, Chamberlain University, and the Ross University School of Medicine.
Clothing stock Ralph Lauren is holding support at the 21-day line as it eyes an entry of 237.16.
All-around performance is solid, which is reflected in its IBD Composite Rating of 91 out of 99. Its relative strength line has just hit fresh heights, a good sign.
10:52 a.m. ET
Dow Jones Today: Boeing Stock Falls Amid 737 Move
Boeing tumbled in early action after South Korea ordered an inspection of all 737-800 planes.
The safety move comes after a deadly crash on Sunday killed 179 of 181 people on board. The Jeju Air flight incident occurred at Muan International Airport in Muan County, South Korea.
Uncertainty still surrounds the exact reasons for the accident. The aircraft's pilot reported a bird strike before attempting a landing. But after the pilot issued a mayday call air traffic control data cut out.
Video footage suggests the aircraft touched down without its landing gear being deployed. According to the BBC, the aircraft had carried out 13 flights in the 48 hours before the crash.
The Boeing 737-800 is a third-generation derivative of the Boeing 737. The firm is now on its fourth generation of the line, the Boeing 737 MAX.
Boeing stock fell 4% but is bouncing off the 200-day moving average. It remains above its 50-day line, which has been starting to turn higher after a prolonged downtrend.
Stock Market Today: Strong Stocks Undercut Key Line
With the stock market uptrend coming under renewed pressure Monday, a few noteworthy stocks were undercutting the 50-day moving average.
Such breaches can be a sell signal. If a stock breaks below the 50-day line in heavy volume and can't rally back, it's an indication that buying demand is drying up and the stock's run is ending. However, if buying support emerges, it can be a bullish indicator.
DoorDash has fallen more than 1% below its 50-day line. It comes amid a decline of nearly 2% in today's session.
It still retains strong gains from a breakout past a 131.21 entry, so this could be an opportunity to take some partial profits.
Costco Wholesale fell below the key 50-day benchmark after dropping more than 2%. It has also slipped below a flat-base buy point of 923.83. Volume was running slightly above average, a negative. The relative strength line is also slipping. The retailer has an IBD Composite Rating of 83.
IBD 50 stock Hims & Hers Health dropped below the 50-day line amid a decline of more than 5%. Volume was below average here. The stock is in danger of round-tripping gains from a 23.74 cup-with-handle entry.
Please follow Michael Larkin on X at @IBD_MLarkin for more analysis of growth stocks.
