The stock market reversed lower at midday Wednesday but small caps went their own way, extending their rally. Tesla gave the market some help.
The Nasdaq composite erased early gains and was down 0.4%, even as chip stocks outperformed. The Philadelphia Semiconductor Index jumped 1.2%.
The S&P 500 eased 0.1%. The Dow Jones Industrial Average was up less than 0.2%.
Volume rose on the NYSE and Nasdaq compared with the same time on Tuesday. Despite weak indexes, breadth was positive, with advancers over decliners by a 3-2 ratio on the Nasdaq and by 13-5 on the NYSE.
Apple erased an earlier gain and was flat at midday as it tests the 180 price level. Wedbush analyst Dan Ives raised his price target on the stock from 205 to 220, saying the upcoming iPhone 15 leaves the company in a "massive position of strength."
The Russell 2000 climbed 1.9% at midday, again leading the stock market. On Tuesday, the Russell jumped 2.7% and is up 3.3% for the week. That follows a 3.3% upsurge last week.
Much of its strength comes from regional banks as the banking crisis fades. SPDR S&P Regional Banks ETF is up nearly 5% so far this week. Its 40 level is firming up as a price floor.
IBD 50 Outperforms Stock Market
The Innovator IBD 50 ETF reversed mildly lower at midday. Several IBD 50 stocks have made impressive runs from their breakouts, and investors could consider taking some profits.
Axcelis Technologies, DraftKings, HubSpot and Confluent are above their 20% profit targets. Royal Caribbean is close to a 20% gain from its 76.30 buy point.
Several stocks topped buy points, based on a check of IBD MarketSmith screens.
Vista Energy climbed out of a cup base with a 22.84 buy point in heavy volume. NVent Electric is breaking out of another cup base, topping a 46.66 entry in light volume.
Howmet Aerospace is clearing a flat base with a 45.70 buy point. Industrial equipment maker Graco rose above an 80.90 flat base entry. Both had weak volume, however.
Dow component Visa fell more than 2% as did rival Mastercard. Some members of Congress plan to revive a bill that would give merchants the ability to process many credit card transactions over different pay networks.
Stock Market Movers: Tesla Extends Gains
Tesla climbed 2.7% and is now extended from its 207.79 buy point. The stock is on pace for a nine-day win streak that has enriched shares by about 25%. That's the best nine-day run since February, when it rallied more than 36%, according to Dow Jones Market Data.
The EV company's Model 3 now has a starting price around $32,000. On Tuesday, the IRS confirmed all Tesla Model 3 trims are eligible for the full tax credit under the Inflation Reduction Act.
Some consumer stocks were among the big movers Wednesday morning.
Campbell Soup gapped down nearly 7% in busy trading, at one point sinking to its lowest price in nearly a year. The company beat quarterly profit estimates, but gave weak fiscal-year guidance.
Casey's Retail, formerly Casey's General Stores, slid 4.4% in heavy volume, piercing the 200-day moving average. A breakout past 236.45 is failing, with the stock triggering the 7% sell rule. The convenience store's earnings fell 7% in the April-ended quarter and sales dropped 4%. Those results also missed expectations, according to FactSet.
General Mills gapped below its 200-day line in heavy trading. The stock is more than 7% below an 87.55 buy point.
Tokyo Stock Market Tumbles
Major foreign markets made modest moves Wednesday. But the Tokyo Nikkei 225 sold off 1.8%, the largest decline since March 14. Investors appear to be taking profits after the index climbed to a 33-year closing high this week.
In economic news, the U.S. trade gap widened to $74.6 billion in April from a revised $60.6 billion gap the previous month. Economists polled by Econoday had forecast $76 billion.
The Mortgage Bankers' Association reported a 1.4% decline in mortgage applications last week, a moderation from the 3.7% drop the previous week.
