The Dow Jones Industrial Average rose on Wednesday ahead of the Federal Reserve’s interest rate decision. Tech giants Alphabet ( GOOGL ) and Microsoft ( MSFT ) reported weaker-than-expected earnings results Tuesday afternoon. Meanwhile, Facebook’s Meta Platforms (META) earnings are due after the close.
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Google parent Alphabet reported June quarter earnings and revenue missed Wall Street targets as YouTube and its cloud computing business missed expectations. Shares rallied more than 3%. Meanwhile, software leader Microsoft missed analysts’ expectations for its fiscal fourth quarter, blaming unfavorable exchange rates and weak PC sales. Microsoft shares rose 5%.
Other top gainers Wednesday morning included Chipotle Mexican Grill ( CMG ), Enphase Energy ( ENPH ), Shopify ( SHOP ), Spotify ( SPOT ), and Texas Instruments ( TXN ). Shares of Dow Jones Boeing ( BA ) and Visa ( V ) also moved.
Chipotle jumped 11%. Enphase easily beat second-quarter estimates and guided to the upside for the current quarter, as shares rose nearly 9%. Shopify rose 4%. Spotify gained 12%. And Texas Instruments crushed Wall Street’s second-quarter targets and guided to the upside for the current period, as shares rose nearly 5%.
Tesla ( TSLA ) was up nearly 2% early Wednesday. Elsewhere, Dow Jones technology leader Apple ( AAPL ) was up 0.7% after the market opened today.
In the volatile stock market environment, shares of Dow Jones UnitedHealth (UNH), as well as ELF Beauty (ELF), Quanta Services (PWR), Ulta Beauty (ULTA), Verra Mobility (VRRM) and Vertex Pharmaceuticals (VRTX) , are among the stocks to watch. Note that the continued volatility of the stock market is a reason to remain more conservative despite recent signs of strength.
UnitedHealth and Vertex are IBD-rated stocks. ELF and Ulta were featured in this week’s Stocks Near A Buy Zone column.
Dow Jones today: Treasury yields, oil prices, Fed decision
After Wednesday’s open, the Dow Jones Industrial Average rose 0.4% and the S&P 500 rallied 1.1%. The Nasdaq advanced 2.15%.
Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust ( QQQ ) rose 1.6%. And the SPDR S&P 500 ETF ( SPY ) gained 1%.
The 10-year Treasury yield rose to 2.81% on Wednesday morning, recovering from Tuesday’s decline. On Tuesday, the 10-year Treasury yield hit its lowest level since April. Meanwhile, US oil prices rallied as West Texas Intermediate futures rose nearly 1% to trade near $96 a year.
The Fed’s two-day meeting concludes Wednesday with a policy decision at 2 p.m. ET, followed by a news conference with Fed Chairman Jerome Powell at 2:30 p.m. Wall Street expects the bank to central bank will raise interest rates aggressively until the end of the year. — and then turn around and start cutting them in six months. Another rate hike of 75 basis points is expected.
Stock Exchange meeting
The Nasdaq led the market lower on Tuesday, selling off 1.9%. The Dow Jones Industrial Average and the S&P 500 fell 0.7% and 1.15%, respectively.
Tuesday’s The Big Picture column commented: “Selling was more concentrated in the Nasdaq composite, which fell 1.9%. But the breadth wasn’t too bad with falling stocks outperforming advancers by about 3 to 2. The ratio was about the same on the NYSE, with losers outpacing winners by less than 2 to 1. Volume rose on the Nasdaq, giving the index a spread day “.
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Dow Jones Gains: Boeing, Visa
Plane maker Boeing rose 3% on Wednesday morning despite missing second-quarter sales and earnings targets. Boeing still sees a positive free cash flow forecast for the full year.
Dow Jones financial leader Visa beat third-quarter revenue and earnings estimates. Earnings grew 33% year over year to $1.98 per share. Sales rose 19% to $7.3 billion. FactSet analysts expected earnings of $1.75 per share on sales of $7.076 billion. Visa shares were down less than 1% in morning trading.
Five Dow Jones Stocks to Watch Now
Dow Jones stocks to watch: UnitedHealth
Health insurance giant and IBD-ranked UnitedHealth shares are more above the 518.80 buy points of their dual-handle fund base after Tuesday’s 0.4% gain, according to the IBD MarketSmith chart analysis. Shares rose 0.6% on Wednesday.
UNH stock scores a solid 95 out of a 99 IBD Composite Rating, according to the IBD Stock Review. Investors can use the IBD Composite Rating to easily measure the quality of a stock’s fundamental and technical metrics.
The 4 most important growth stocks to watch in the current stock market rally
Best stocks to watch: ELF, Quanta, Ulta, Verra, Vertex
ELF Beauty is about 3% below a 33.54 buy point in a mug with a handle after recent suffering. The RS line hit a new high last week, which is a sign of strong stock performance. ELF shares rose on Wednesday.
Quanta Services is putting the finishing touches on a cup-with-handle base that has a buy point of 138.56, according to IBD MarketSmith chart analysis. Meanwhile, an early entry at 133.68 is also in play. Shares rose 0.2% on Wednesday.
IBD Big Cap 20 stock Ulta Beauty is building a flat base at 429.58 buy points, but is below its 50-day line after Tuesday’s 4.1% drop. The base comes on the back of a failed breakout following the 426.93 cup-handled entry in June. Shares of Ulta rose nearly 1% on Wednesday.
Verra Mobility is trading about 5% below 16.83 buy points a handle cup following Tuesday’s 4.3% drop. The stock’s RS line continues to show great strength as it hit another new high last week. Verra shares rose 1% on Wednesday.
According to IBD MarketSmith chart analysis, Vertex Pharmaceuticals found support around the 279.23 cup-handle buy point amid a two-day winning streak. The biotech leader is in a 5% buy zone that rises to 293.19 amid Tuesday’s 1.6% gain. Vertex shares fell 2% on Wednesday.
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Tesla stock
Tesla shares slipped 3.6% on Tuesday, falling for a second straight session and giving back some of last week’s earnings-driven 13.4% gain. Shares briefly touched their highest level since early May, but are still around 38% of their 52-week high.
Shares rallied about 2% Wednesday morning.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares fell 0.9% on Tuesday, extending a losing streak to three sessions. Apple is holding above its 50-day line after the bullish action of the past few weeks. Still, the stock remains below its longer-term 200-day line, which looms as a resistance level to watch. The stock is 17% off its 52-week high. Apple shares rose 0.7% on Wednesday.
Microsoft sold off 2.7% on Tuesday, falling further below its 50-day line. The stock closed about 28% off its 52-week high. Microsoft rose 5% on Wednesday after the company’s results and earnings guidance.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more growth stocks and the Dow Jones Industrial Average.
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