Stock futures idled quietly in positive terrain early Thursday, as markets awaited weekly jobless claims and first quarter labor cost data. PayPal Holding and Builders FirstSource surged on strong earnigns reports. Goldman Sachs and Visa were among the stocks rising in buy ranges on the Dow Jones today.
Dow Jones futures eked out a 0.1% advance. S&P 500 futures and Nasdaq 100 futures also traded 0.1% above fair value on the stock market today, while small caps ran slightly ahead in premarket action, with Russell 2000 futures up 0.3%.
IBD Leaderboard stock PayPal Holding (PYPL) rattled off an early 4.6% gain, leading both the Nasdaq 100 and the S&P 500. JMP Securities raised the stock’s price target to 300, from 275, after the company reported an above-forecast first-quarter performance. PayPal stock ended Wednesday 12% below a 277.96 buy point in a cup-with-handle base.
At Home Group (HOME) spiked 15% to lead the IBD 50 list. Wells Fargo raised the stock’s price target to 37, from 30, and the Wall Street Journal reported that the home decor retailer was nearing a deal to be acquired by private equity firm Hellman & Friedman at a share price in the mid-30s.
Dow Jones Today: Visa, Goldman Sachs Rising
Goldman Sachs is just breaking out past a 356.95 buy point in a cup base.
Visa is in a buy range above a flat base buy point at 228.33
Earnings News: Builders FirstSource, CF Industries
Builders FirstSource (BLDR) bounced 3.8% after reporting first-quarter sales and earnings well above analyst targets, and raising full-year revenue guidance above the consensus target. Shares are up 22.5% so far this year, and rebounding from support at their 21-day exponential moving average.
Agricultural chemicals plays CF Industries (CF) and FMC (FMC) dropped 1.2% and 2.3%, respectively, despite first-quarter results that topped expectations. CF closed less than 3% below a 51.34 buy point in a cup base.
Also on the downside, drug wholesaler Cardinal Health (CAH) dived more than 8% after a revenue and earnings miss. Biotech Moderna (MRNA) tumbled 6%, after revenue growth stopped short of analyst projections — also hurt by reports late Wednesday that the Biden administration backed removing patent protection for coronavirus vaccines.
Bitcoin Rebounds, Ethereum Tops $3,000
Bitcoin prices rose 3%, to above $57,200, according to CoinDesk. The cryptocurrency had run up to a new high above $64,800 on April 14, ahead of the Coinbase Global (COIN) IPO. Bitcoin dropped about 3% in April, but remains up about 96% since Dec. 31, after starting the year just above $29,000.
Competing cryptocurrency Ethereum gained more than 3% to trade just below $3,500. Ethereum rose above the $3,000 level for the first time late Sunday.
Vital Signs: Oil, Copper, Bond Yields, Bitcoin
West Texas Intermediate oil bobbed around the $65 a barrel mark. WTI oil on Wednesday briefly touched 66.76, its highest price since March 8, when it peaked at 67.98. That was its highest level since Oct. 2018.
Copper prices gained 0.8% — holding in record high territory above $4.55 a pound after pushing past a Feb. 2011 peak on Wednesday. Copper prices have climbed more than 29% since the start of the year.
Bond yields edged lower, with the 10-year yield dipping to 1.57%, after settling just above 1.58% on Wednesday, according to CBOE data. It was the 10-year yield’s first two-day slip below support at its 50-day moving average since August. Yields skirted pre-pandemic levels late in March, climbing to almost 1.76% — the highest level since January 2020.
Nasdaq Under Pressure
The Nasdaq Composite continues to show early-day strength, and late-day weakness, which is typically a bearish mode of behavior. The index is testing and so far holding support at its 50-day moving average
On Tuesday, heavy losses in the Nasdaq caused IBD to change its market outlook from “confirmed uptrend” to “uptrend under pressure,” according to Wednesday’s Big Picture article. This means investors should be more selective with stock purchases while the market negotiates this rough stretch. Taking some profits to raise cash is another smart move.
Dow Jones Today: 3 Blue Chip Breakouts
But while the Nasdaq consolidates, the Dow Jones today has advanced in four of the past five sessions and appears to open in fresh record high territory. The S&P 500 made a weak bounce off its 21-day exponential moving average on Wednesday, but is showing support at that level and trading just off its April 29 peak.
Year-to-date performance on the Dow shows, at the bottom of the list, NikeNKE down 6.6% and MerckMRK off 5%. AppleAAPL and Salesforce.comCRM are also among the top five declines, down a bit more than 3% each.
However, more than half of the 30 Dow Jones stocks have climbed more than 10% this year. Walgreens Boots Alliance (WBA) and Goldman Sachs are each up more than 35%. As mentioned earlier, Goldman Sachs is just breaking out past a 356.95 buy point in a cup base.
Caterpillar (CAT) has a 30.7% gain and, sitting on a four-day rally, is also breaking out. Its flat base buy point is at 237.88.
Home Depot (HD) has rallied 25% since the start of the year. It is extended from a late-March breakout. But after a brief consolidation the stock on Monday moved into a buy zone above a three-weeks tight buy point at 328.93. The buy range extends to 345.38.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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