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Stocks Close Lower After S&P 500 Hits New High; These Stocks Break Out

The Dow Jones Industrial Average traded lower in today’s stock market as all the major indexes closed slightly lower and near their lows of the day. The Nasdaq composite led on the downside while the S&P 500 notched another new all-time high in early trading.




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At the market close, the small-cap Russell 2000 was down more than 0.2%. Meanwhile, the Nasdaq fell less than 0.1%. The S&P 500 traded 0.1% lower after reaching a high of 4,086.23. The Dow Jones industrials declined 0.3%. Early data showed volume fell on the Nasdaq and on the NYSE vs. the close on Monday.

Stocks initially rose Tuesday on prospects of strong economic growth thanks to recent government spending, vaccinations and the relaxation of restrictions.

The IBD/TIPP Economic Optimism Index, an early monthly read on consumer confidence, rose one point to 56.4 in April, the highest reading since early February 2020. This was the fourth monthly gain in a row. Readings above 50 generally reflect optimism.

Additionally, a recent acceleration in the Covid-19 vaccine rollout also has allowed multiple states to ease up on restrictions. President Biden plans to announce that all U.S. adults should be eligible for Covid-19 vaccines by April 19.

As for growth stocks, the Innovator IBD 50 ETF (FFTY) climbed 0.2%, beating the major indexes. The growth-focused index is still trading below the 50-day line but is close to reclaiming this key area of support. IBD 50 Stocks leading the upside on Tuesday were Lovesac (LOVE) and Plby Group (PLBY), with gains of more than 5% each.

Three Stocks Break Out

The past several weeks have been choppy for the major indexes. IBD changed its market outlook to confirmed uptrend as the S&P 500 notched a recent follow-through signal. While the market is flashing a green light for investors to continue initiating new positions, it may be best to keep a conservative stance.

A handful of stocks broke out on Tuesday. Among them were IBD 50 stock Green Brick Partners (GRBK), Charles River Labs (CRL) and Avantor (AVTR).

Homebuilder Green Brick Partners recently formed a consolidation with a 25.15 buy point. On Tuesday, the growth stock broke out and hit a new high of 27.40. The stock closed above the upper edge of the 5% buy zone, which topped out at 26.40.

Shares of Charles River Labs, a MarketSmith Growth 250 stock, rose above a 303.89 buy point from a flat base. Shares closed just below the 5% buy zone. The stock reached a new high of 307.44 after rising more than 1.7%.

Elsewhere, Avantor gapped up into the buy zone above its 31.15 consolidation buy point. Shares gained more than 3% and reached a new high of 31.43. The stock is now trading inside the 5% buy zone, which tops out at 32.70.

Dow Jones Today

As for the Dow components, Nike (NKE), McDonald’s (MCD) and Disney (DIS) led the upside with gains of over 0.6% each. On the downside, shares of Walgreens (WBA) and UnitedHealth Group (UNH) were down 1.5% or more each.

Leaderboard stock Microsoft (MSFT) lost nearly 0.5% but traded within a key 5% buy zone. Microsoft is also an IBD Long-Term Leader stock. Microsoft stock is currently within range of a 246.23 buy point of a new flat base, according to MarketSmith chart analysis.

Elsewhere, Coca-Cola (KO) stock formed a cup with handle, according to MarketSmith analysis. It is nearing the ideal buy point of 54.04.

On Tuesday, shares closed 0.7% higher and remained 3% away from the key buy point.

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