The stock market traded mixed Tuesday morning as a new warning in the retail sector put a damper on retail stocks, but higher oil prices lifted energy stocks.
The Nasdaq composite edged down 0.1%. Both the S&P 500 and the Dow Jones Industrial Average were down 0.1%. But the indexes were off the opening lows.
The small-cap Russell 2000 index gained 0.4%.
Volume fell on the NYSE and Nasdaq compared with the same time on Monday.
The U.S. reported a sharp drop in April imports. The trade gap in goods and services fell to 19.1% in April from the prior month to a seasonally adjusted $87.1 billion, the Commerce Department said Tuesday, retreating from a record $107.7 billion deficit the prior month. The decline in the trade gap puts a strain on the value of the U.S. dollar.
RV Maker Drops But Oil Stocks Gain
RV and specialty vehicle maker Rev Group missed analysts' expectations on both sales and earnings. Its shares plunged 17%. The company reported fiscal second quarter earnings of 17 cents a share on $576 million. Analysts expected the company to earn 24 cents a share on sales of $600 million. Rival recreational vehicle maker Thor Industries reports earnings on Wednesday.
Oil and coal stocks were up sharply in the stock market Tuesday. The S&P Energy Select Sector ETF was up 1.7%, leading all S&P sectors. Exxon Mobil was up 3%.
Oil prices gained 0.6% to $119.30 a barrel for crude.
Vermillion Energy broke out past its proper buy point of 24.03, surging 4%.
Steel tubing maker for the auto and oil industries Timkensteel soared nearly 6%, also scoring a breakout of a cup-with-handle pattern with a 24.90 entry.
The stock got some airtime in the final minutes of Tuesday's IBD Live show.
Shares of Mirati Therapeutics stock rocketed 27% Tuesday after MRTX unveiled early — but promising — test results for a lung cancer treatment. Mirati added its treatment, adagrasib, to Merck's Keytruda in patients with a form of lung cancer. Early evidence suggested patients responded to the combination and, importantly, there were few elevations in liver enzymes.
IBD 50 Outperforms Stock Market
Innovator IBD 50 ETF outperformed the stock market with a 0.5% increase. Arch Resources led the IBD 50 with a 9% jump to a new high. Jefferies upgraded the coal stock to buy from hold and lifted the price target to 225 from 160.
Shale oil company Earthstone Energy gained 6% to 21.60, also a new high. The stock is extended past a buy point it hit in late April.
Target, which was a stock market leader in the retail sector in 2020 and part of 2021, tumbled nearly 4% in heavy trading after the retailer warned of shrinking profits because it is overstocked with unwanted merchandise that will force it to cancel orders or offer discounts.
The forecast reflects a mismatch between supply in stores and shifting demand among consumers. Walmart and Costco fell in sympathy.
Target's warning comes nearly three weeks after the retailer missed earnings estimates due to inventory problems and higher costs.
J.M. Smucker climbed more than 3% in heavy trading. The food, beverages and pet food company beat April-quarter expectations, but warned that a voluntary recall of Jif peanut butter will impact full-year earnings. The stock is rebounding after snapping a four-day losing streak Monday.
Follow Michael Molinski on Twitter @IMmolinski
