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Dow Jones Rallies As Inflation Picks Up; Apple Falls On Downgrade, AMC Stock Rockets 38%

The Dow Jones Industrial Average briefly rallied 150 points Friday, as a key inflation gauge narrowly topped estimates. Apple received a rare downgrade, while AMC stock rocketed as much as 38% in morning trade.




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Among the Dow Jones leaders, Apple (AAPL) fell 0.1% Friday, while Microsoft (MSFT) moved up almost 1% in today’s stock market. Goldman Sachs (GS) and JPMorgan (JPM) are in buy zones.

Tesla (TSLA) fell nearly 1% Friday, on pace to give back a part of Thursday’s 1.9% gain. Dow Jones stock Salesforce (CRM) and Veeva Systems (VEEV) reported earnings late Thursday.

Among the top stocks to buy and watch, Applied Materials (AMAT), ArcelorMittal (MT) and TransDigm (TDG) are in or near buy zones.

Microsoft and TransDigm are IBD Leaderboard stocks. ArcelorMittal is an IBD SwingTrader stock.

Dow Jones Today: Key Inflation Gauge

The Dow Jones Industrial Average traded up 0.3% Friday, while the S&P 500 rose 0.35%. The tech-heavy Nasdaq composite rallied 0.55% in midday trade.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 34535.92 +71.28 +0.21
S&P 500 (0S&P5) 4207.02 +6.14 +0.15
Nasdaq (0NDQC ) 13775.03 +38.75 +0.28
Russell 2000 (IWM) 225.20 -0.45 -0.20
IBD 50 (FFTY) 44.99 -0.20 -0.44
Last Update: 10:30 AM ET 5/28/2021

The Commerce Department’s core Personal Consumption Expenditures price index for April rose 3.1% year over year, topping economist expectations for a 3.0% increase. On a monthly basis, the core PCE Index rose 0.7%, in line with economist projections. The core PCE price index measures the prices paid by consumers for goods and services excluding food and energy prices.

Among exchange traded funds, the Innovator IBD 50 (FFTY) moved up 0.3% Friday. Nasdaq 100 tracker Invesco QQQ Trust ETF (QQQ) traded up 0.6%. Meanwhile, the SPDR S&P 500 ETF (SPY) rose 0.4%.

Stock Market Rally

The Dow Jones Industrial Average and S&P 500 continue to rebound from their 50-day support levels with modest gains Friday. Meanwhile, the tech-heavy Nasdaq looks to build upon Monday’s bullish retake of its 50-day line.

Thursday’s Big Picture column commented, “While the health of the market trend is slightly improving, the market has piled up distribution in the past several weeks, indicating higher-than-normal market risk. The S&P 500 holds six days of institutional selling, while the Nasdaq has four. Given the escalated amount of selling, investors should keep conservative market exposure and focus only on exceptional breakouts.”

For more stock market commentary, check out IBD’s The Big Picture.


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Dow Jones Stocks: Goldman, JPMorgan

Dow Jones financial leader JPMorgan is trading in buy range above a 161.79 buy point in a flat base, according to IBD MarketSmith chart analysis. Shares lost 0.2% Friday morning.

Goldman Sachs is in the 5% buy range past a 356.95 buy point that goes up to 374.80. Shares were up 0.4% Friday.

Dow Jones Earnings: Salesforce

Late Thursday, Salesforce reported earnings and revenue that topped analyst estimates. Q2 guidance also came in above expectations.

CRM stock jumped over 6%, decisively retaking its long-term 200-day line. Shares are about 15% off their 52-week high.

Stocks To Buy And Watch: Applied Materials, ArcelorMittal, TransDigm

Applied Materials moved up 1.1% Friday, and is squarely above the 50-day line. Shares are building a consolidation with a 146.10 buy point. Meanwhile, an early entry at 138.77 is also in play.

According to IBD Stock CheckupAMAT stock boasts a strong 97 out of a perfect 99 IBD Composite Rating.

IBD SwingTrader stock ArcelorMittal looked to add to Thursday’s over-4% advance, as the mining leader bullishly rebounds from its 50-day support level. The strong bounce places the mining leader in a new buy area. Shares dropped 0.25% Friday morning.

New IBD Leaderboard stock TransDigm broke out past a 633.14 buy point in a flat base Thursday. The 5% buy zone goes up to 664.80. As noted in Leaderboard, TransDigm’s relative strength line rose to the highest level since the start of the base’s formation in early April. That’s a positive sign.

The stock slipped 0.8% early Friday.


Market Rally Gains Steam; Four Stocks In Buy Zones


 

Stock Market Earnings: Veeva Systems

IBD Long-Term Leader Veeva Systems crushed earnings and sales estimates late Thursday. Veeva earned 91 cents per share on $433.6 million in sales.

The stock soared 11% Friday morning and is moving further above the 50-day line. Shares remain about 10% off their 52-week high.

AMC Stock

AMC Entertainment (AMC) rocketed as much as 38% Friday morning before slashing gains to about 8% in morning trade, adding to Thursday’s 35% surge. Shares are on pace to skyrocket more than 170% this week.

AMC stock is above its January high of 20.36 when the Reddit short-squeeze mania sent heavily-shorted stocks soaring.

AMC’s surge this week has already inflicted a $1.3 billion loss for short sellers, according to data from S3 Partners.


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Tesla Stock

Tesla stock fell nearly 1% Friday morning, whittling off a piece of Thursday’s nearly 2% rise. Shares are at their highest level since May 10.

The stock reclaimed its long-term 200-day moving average on Monday. A new base could be forming, but the stock is far away from any new buy point.

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 fell 0.1% after receiving a rare downgrade Friday morning. New Street Research downgraded Apple stock from neutral to sell with a 90 price target.

Shares are struggling to retake their 50-day line. A decisive retake of the 50-day line would be bullish for the stock’s prospects; however, the stock’s lagging RS line indicates significant stock market underperformance.

Earlier this month, the stock triggered the 7%-8% loss-cutting sell rule from a 135.63 buy point.

Software giant Microsoft moved up almost 1%, and remains in buy range above a flat base’s 246.23 buy point, according to IBD MarketSmith chart analysis. The buy zone goes up to 258.54.

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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