Dow Jones Pares 400-Point Loss As Powell Testifies; Apple, Tesla Stocks Sell Off But Disney Rallies

The Dow Jones Industrial Average dived nearly 400 points early Tuesday before trimming its loss as Fed Chief Jerome Powell testified to Congress.

Early Tuesday, Powell reiterated that the Fed is “committed to using our full range of tools to support the economy and to help ensure that the recovery from this difficult period will be as robust as possible,” in a speech in front of the Senate Banking Committee.

He commented that inflation and employment remain well below the Fed’s objectives, which suggests easy monetary policy is likely to remain in place.

Tech stocks boosted the Nasdaq to a 43.6% gain in 2020 for its fifth best year ever. The S&P 500 rose 16.3% and the Dow added 7.2% last year. Read The Big Picture for detailed daily market analysis.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 31402.65 -119.04 -0.38
S&P 500 (0S&P5) 3849.00 -27.50 -0.71
Nasdaq (0NDQC ) 13257.37 -275.68 -2.04
Russell 2000 (IWM) 218.82 -4.91 -2.19
IBD 50 (FFTY) 45.44 -2.04 -4.30
Last Update: 1:16 PM ET 2/23/2021

The Covid-19 pandemic continues to roil the U.S. economy, as nationwide lockdowns approach the one-year mark. But there are signs of hope as vaccinations roll out and cases start to plateau in some states.

Cumulative Covid-19 cases worldwide have topped 112 million with nearly 2.5 million deaths, according to Worldometer. In the U.S., cases are now approaching 29 million with more than 513,000 deaths, although the number of new cases in the U.S. has slowed dramatically in recent weeks.

Dow Jones Losers And Winners

Home Depot (HD) tumbled 4% in heavy trade to gap down below its 50-day moving average. The big-box home improvement retailer reported better-than-expected Q4 earnings and sales before the open.

Home Depot’s earnings increased 16% to $2.65 a share, including 9 cents in one-time costs related to the acquisition of HD Supply. Revenue rose 25% to $32.26 billion. Same-store sales surged 24.5%, with U.S. comps up 25%.

Apple (AAPL) gapped down and fell nearly 3% in heavy volume. It’s traded below its 50-day line for the past week. On Feb. 18, Apple stock triggered the 7%-8% loss-cutting sell rule when it fell more than 7% below a 138.89 buy point of a cup with handle.

Other big blue chip losers included Boeing (BA), Intel (INTC), Microsoft (MSFT), Nike (NKE), (CRM) and Walgreens Boots Alliance (WBA), down more than 1.5% each.

Microsoft has now slipped below a 232.96 buy point and is getting close to testing its 50-day moving average line.

Disney (DIS) rallied 2.6% to a new high in nearly triple normal trade. It’s now extended from a 183.50 buy point of a flat base, according to MarketSmith chart analysis. The buy zone for Disney stock topped out at 192.68. The media and theme parks giant was featured in Monday’s IBD Stock Of The Day.

Outside The Dow

Software, automaker and solar stocks led the downside among IBD’s 197 industry groups. Banks, utilities and hotel stocks were among the few gainers.

In the automaker group, Tesla (TSLA) crashed 13% before paring its loss to 5%. The stock breached its 50-day line Monday, for the first time in over three months. It’s on pace to extend its losing streak to four. On Sunday, the electric-vehicle maker stopped taking orders for the cheapest version of the Model Y Standard Range sport utility vehicle.

Tesla stock remains well extended from a 466 buy point of a cup with handle. It’s now about 25% below its Jan. 25 high of 900.40. Tesla is an IBD Leaderboad stock.

Among other EV stocks, China’s Nio (NIO) and Xpeng (XPEV) lost a respective 8% and 5%. Nio trimmed its loss from a 17% dive early Tuesday. On Monday, shares fell 8% to close below the 50-day line for the first time in over 10 months.

The Innovator IBD 50 ETF (FFTY) slumped as much as 8% before finding support at its 50-day line. By midday, shares had cut their loss to 4%. 360 DigiTech (QFIN) sank 12%, while Trex (TREX), Cerence (CRNC) and Meridian Bioscience (VIVO) lost over 5% each.

Follow Nancy Gondo on Twitter at @IBD_NGondo


5 Travel Stocks In Buy Zone But Watch This Key Rating

Find Today’s Best Growth Stocks To Watch With IBD 50

Learn How To Time The Market With IBD’s ETF Market Strategy

Find Winning Stocks With MarketSmith Pattern Recognition & Custom Screens

Source link