The Dow Jones Industrial Average soared on Monday, despite rising yields. Cathie Wood of Ark Invest took advantage of potential bargains in the market, while Microsoft (MSFT) and Amazon.com (AMZN) joined a prestigious list of stocks. However, Tesla (TSLA) experienced a significant drop.
Meanwhile, Ollie’s Bargain Outlet (OLLI), FTAI Aviation (FTAI), and NetEase (NTES) showed strength and looked for entry points, as they built bullish bases.
Stocks rallied, even with the increase in Treasury yields, ahead of the Federal Reserve meeting. The meeting is set to take place on Tuesday and Wednesday, with Federal Reserve Chair Jerome Powell scheduled to speak at the conclusion. The yield curve remains inverted, and the Treasury announced plans to borrow $776 billion in the last three months of 2023, below Wall Street expectations.
Oanda senior market analyst Edward Moya noted that “U.S. stocks are rallying as widening war fears eased a bit,” which may explain the tech-heavy Nasdaq’s 1.2% rise. However, On Semiconductor (ON) failed to perform well, dropping around 21.8% after disappointing Wall Street with its outlook.
The S&P 500 also had a significant increase of 1.2%. Western Digital (WDC) experienced a 7.3% increase after announcing its plans to spin off its flash memory business and focus on its hard-drive business. Communication services, financials, and consumer staples had the best performance, while energy had the slimmest gain. Small caps underperformed, but the Russell 2000 still rose 0.6%. Growth stocks also lagged behind, with the Innovator IBD 50 ETF (FFTY) rising 0.7%.
The Dow Jones Industrial Average performed the best among major indexes, rising 2% and reaching 511 points. McDonald’s stock played a significant role in this rise, with the burger titan delivering impressive earnings and revenue. Nike (NKE), Verizon Communications (VZ), and Goldman Sachs (GS) also made solid gains.
Cathie Wood, despite the risks, took advantage of recent pullbacks to purchase shares of Block (SQ), Beam Therapeutics (BEAM), and Verve Therapeutics (VERV). However, these stocks have yet to yield positive returns and currently trade below their moving averages.
ARK Innovation ETF also made other moves, including selling some stock of DraftKings (DKNG), Shopify (SHOP), and General Motors (GM). While Microsoft and Amazon stock joined the IBD Leaderboard Watchlist, it is important to note that being on the list does not guarantee their current suitability as investments.
Despite overall gains in the market, Tesla stock experienced a 4.8% drop and fell below its 200-day moving average.
Looking beyond the Dow Jones, three noteworthy stocks showing strength are Ollie’s Bargain Outlet, FTAI Aviation, and NetEase. Ollie’s Bargain Outlet has a strong performance record and is currently building a flat base, FTAI Aviation is approaching a flat base buy point, and NetEase’s relative strength line is at new highs as it also builds a flat base.
For more analysis of growth stocks, follow Michael Larkin on X, formerly known as Twitter, at @IBD_MLarkin.
Source: Example Article
