The Dow Jones Industrial Average reversed lower, sliding 125 points Friday, as Treasury Secretary Yellen warned of more inflation. Covid vaccine maker Moderna surged on S&P 500 inclusion, while Tesla looked to extend its decline to a third day.
Among the Dow Jones leaders, Apple (AAPL) moved up 0.4% Friday, while Microsoft (MSFT) rose 0.6% in today’s stock market. McDonald’s (MCD) broke out past a new buy point Wednesday, but is back below the entry.
Tesla (TSLA) was on track to extend a three-day losing streak, sliding nearly 1% Friday morning. Covid vaccine maker Moderna (MRNA) surged 9% on news that it will join the S&P 500 index on July 21.
Among the top stocks to buy and watch, Advanced Micro Devices (AMD), PayPal (PYPL), Roku (ROKU) and Shopify (SHOP) are in or near new buy zones.
Microsoft, PayPal and Shopify are IBD Leaderboard stocks. Roku is an IBD SwingTrader stock. PayPal was featured in this week’s Stocks Near A Buy Zone column.
Dow Jones Today: Yellen Comments
The Dow Jones Industrial Average reversed lower to fall 0.4% Friday, while S&P 500 lost 0.3%. The tech-heavy Nasdaq dropped 0.3% in morning trade.
U.S. Stock Market Today Overview
Last Update: 10:26 AM ET 7/16/2021
Late Thursday, Treasury Secretary Janet Yellen warned that prices could continue to rise for several more months. “We will have several more months of rapid inflation,” Yellen told CNBC. “So I’m not saying that this is a one-month phenomenon. But I think over the medium term, we’ll see inflation decline back toward normal levels. But, of course, we have to keep a careful eye on it.”
Earlier Thursday, Federal Reserve Chairman Jerome Powell defended the Federal Reserve’s easy money policy. “This is a shock going through the system associated with the reopening of the economy and it’s driven inflation well above 2%, and of course we’re not comfortable with that,” Powell said.
Stock Market Rally
The S&P 500 neared record highs Friday, while the Nasdaq looked to snap a three-day slide with modest gains. The Dow Jones industrials are trading just below the all-time high set in early May.
Thursday’s Big Picture column noted, “The stock market remains in a confirmed uptrend, even though the distribution-day count is starting to climb. The S&P 500 has five distribution days, including a stall day on Wednesday. The Nasdaq’s count upped to three Thursday after narrowly missing a distribution day Wednesday due to lower volume.”
For more stock market commentary, check out IBD’s The Big Picture.
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Dow Jones Stocks To Buy And Watch: McDonald’s
Dow Jones restaurant giant McDonald’s is trading below a 238.28 buy point in a flat base, according to IBD MarketSmith chart analysis, after Wednesday’s breakout attempt. Shares were up less than 0.1% Friday.
McDonald’s was featured in last week’s IBD Industry Themes column, along with Chipotle Mexican Grill (CMG). Chipotle stock is in a new buy range past a 1,579.62 buy point.
Stocks To Buy And Watch: AMD, PayPal, Roku, Shopify
Chip giant Advanced Micro Devices is tracing a cup with handle that shows a 95.54 buy point, according to IBD MarketSmith chart analysis. Shares rallied 0.6% Friday morning and are about 10% away from the new buy point.
According to IBD Stock Checkup, AMD stock shows a strong 97 out of 99 IBD Composite Rating. The IBD Composite Rating identifies stocks with a blend of strong fundamental and technical characteristics. AMD was featured as Tuesday’s IBD Stock Of The Day.
IBD Leaderboard stock PayPal is in the 5% buy zone past a cup with handle’s 296.11 buy point following last week’s breakout. The 5% buy area goes up to 310.92. Shares rose 0.1% Friday and are squarely in buy range.
On June 17, the top payments processor broke out above a 277.96 entry in a cup base and is comfortably above that level. Leaderboard noted the stock’s rising relative strength line is a positive attribute even though it remains off its 2021 high.
Roku is trading about 7% away from a cup-with-handle’s 463.09 buy point. Shares lost 0.6% Friday. Roku is an IBD SwingTrader stock.
Shopify is still below a 1,552.33 buy point in a cup with handle. Shares dropped 0.1% Friday following Thursday’s 1.5% fall.
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Moderna Stock Surges On S&P 500 Inclusion
Vaccine maker Moderna surged 9% to new highs Friday morning on news that it will be added to the S&P 500 index. It will replace Alexion Pharmaceuticals (ALXN) on July 21.
Moderna stock is sharply extended from a cup with handle’s 189.10 buy point.
Tesla stock dropped 0.3% Friday morning, on pace to extend a three-day losing streak. The electric-vehicle giant is again testing support around its long-term 200-day moving average. Another strong show of support at these levels would be bullish for the stock’s prospects.
On Jan. 25, Tesla stock hit a record high at 900.40, after climbing as much as 93% from a 466 buy point in a cup with handle.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple gained 0.4% Friday, recapturing a part of Thursday’s 0.45% loss. The stock hit another all-time high Thursday before reversing lower.
Apple stock is extended past the 5% buy zone from a 137.17 entry in a cup base, according to IBD MarketSmith chart analysis.
Microsoft continues to trade solidly above a cup base’s 263.29 buy point. Shares gained 0.6% Friday following a price target hike from Mizuho. The stock is extended above the 5% buy zone, which goes up to 276.45.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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Dow Jones Today Retakes 35,000 As Stocks Climb On Retail Sales Data; Moderna Spikes; Starbucks Tops Buy Point