The Dow Jones Industrial Average is enjoying a solid, albeit shortened, week of trading in the current stock market. Key indices cooled in the last half hour of trading. However, the Dow Jones still gained nearly 0.6% for a 3.9% advance in the last four sessions with minutes remaining in the regular session. Its annual loss has decreased to approximately 9%.
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IBD Classification Table Microsoft (MSFT) Caterpillar (CAT) and industrial power 3 millions (MMM) marked the rise among Dow’s 30 industrial stocks, each earning 1 point or more. Microsoft, a major cloud computing game, has now expanded considerably after surpassing a suitable purchase point of 180.10. Please refer to your annotated daily and weekly leaderboards for more details.
The Nasdaq compound, which rose nearly 0.8% in late-afternoon trading on Thursday before the four-day vacation weekend of July 4, shows a 14.2% gain from January 1 ; The S&P 500, with an increase of less than 0.7%, still harbors an annual loss of less than 3%.
The innovative IBD 50 ETF (FFTY) rose as much as 1.2% on Thursday to mark its highest level since February 25, the exact day the IBD downgraded the current outlook on equities to the “correction market.” A correction is the best time to quickly raise money, get out of the margin, secure gains on major growth stocks, and reduce losses.
Boost the Dow Jones
Stock market gains followed a buoyant US payroll report in June. While the country experienced a 4.8 million increase in non-farm jobs, breaking the Econoday consensus forecast for a gain of 3 million jobs, the adjusted figure for May showed an increase of up to 2.7 million aggregate net jobs. That is more than 2.51 million.
Unemployment fell to 11.1% still high, from 13% in May.
Stocks of electric vehicles: is it time to rest?
IBD’s Moving Stock Chart Displayed Work horse (WKHS) and DocuSign (DOCU) on the rise as they have both made outstanding gains in recent months. The first, a new entrant to the electric motor truck market, fell back to session highs but still had a 4% gain.
Notice on a daily chart how the movement has been nearly vertical in the past two weeks. Such movements are unsustainable.
Generally, higher quality stocks will already be trading well above $ 10, even $ 20 per share when they build a solid foundation and stage a successful breakout.
In Workhorse’s case, the stock offset a low-priced cup base with a buy point of 3.53 on June 9. Volume that day increased nearly four times its 50-day average.
Currently, the average volume of Workhorse dollars has increased to more than $ 300 million per day. That is solid.
The Street believes the Loveland, Ohio company will lose 33 cents a share this year and another 28 cents in 2021. The share has a market value of $ 1.4 billion and 71 million shares outstanding. In the first quarter, Workhorse posted a net profit of 7 cents a share on sales of approximately $ 80,000. On June 30, Workhorse announced a $ 70 million financing from a single institutional investor in the form of a senior guaranteed convertible note.
At IBD Live
Akamai (AKAM) attracted immediate attention at IBD’s live show on Thursday due to a sharp breakout.
The shares of the data transmission expert rallied over 7% on the fast turnaround, clearing a buy point of 108.35 on a flat basis. An early entry point at 106.56 could also have been warranted.
Down, Advanced micro devices (AMD) was unable to join Thursday’s rally, losing less than 10 cents.
Notice how the stock continues to travel on the south side of its 50-day moving average, generally a no-no for higher-growth stocks, especially given that the market has been in a confirmed bullish trend since April 2.
Read the Big Picture from April 2 for more information on why the market trend changed significantly in that session, in which the S&P 500 rebounded 2.3% on higher NYSE turnover on the eighth day of its new recovery attempt.
Will AMD shares underperform in the third quarter?
AMD headed into trading Thursday at No. 14 on the IBD 50. It has certainly marked a good 2020 so far; its 14.6% gain outweighs a 2% loss in the S&P 500. Meanwhile, the triple-lever Direxion Semiconductor Bull 3X (SOXL) exchange-traded fund, despite gaining nearly 5% on Thursday, still shows a massive 31% drop to date.
But IBD Stock Checkup shows that while the composite rating of 98 places AMD at the top echelon among chip sector stocks, it has been struggling to launch a new breakout.
Notice how your relative line of force has been tilting down for at least 11 weeks in a row. An ascending RS line means that a stock is outperforming the S&P 500.
IBD Live on Thursday discussed nearly half a dozen additional semiconductor stocks that have shown superior performance in the market lately.
Now AMD has done an outstanding job of overcoming Intel (INTC) in some fields, including supercomputing, as well as the design of smaller high-speed chips that can get into smaller and smaller Internet devices. And Wall Street has applauded the company’s strong innovative streak lately.
Analysts surveyed by FactSet project that AMD earnings will increase 100% in the second quarter to 16 cents a share from a year ago in a 20% increase in sales to $ 1.83 billion. Earnings fell 43% in the prior year quarter, which helped drive this estimate. However, AMD’s bottom line increased 38% in the third quarter of 2019, then shot up 300% and 200% in the last two quarters.
These numbers help give Advanced Micro Devices a top-tier 99 EPS rating, according to the IBD Stock Review.
Check out this IBD Technology Story detailing AMD’s recent technology advancements.
Biotechnology Stock News
Meanwhile, biotechnology Modern (MRNA) at one point slipped more than 9% on high sales volume before reducing some losses. STAT News reported that the company is delaying the start of a clinical trial of 30,000 late-stage patients for a coronavirus vaccine, possibly in late July.
Read this previous Stock Market Today story about key technical stocks for investors to study.
Follow Chung on Twitter at @SaitoChung and @IBD_DChung for more information on growing stocks, buy points, breakouts, sell rules, and market insights.
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