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Dow Rallies But Nasdaq Lags As Growth Stocks Weigh

The Dow Jones Industrial Average led key indexes higher midday Wednesday, though the Nasdaq lagged as several key tech stocks got hit.




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The Dow Jones industrials rallied 0.5% and reached a new all-time high. The S&P 500 rose 0.4% and the Nasdaq composite added 0.2% in the stock market today. Small caps tracked by the Russell 2000 outperformed, up 0.9%. Volume was mixed, higher on the NYSE but lower on the Nasdaq vs. the same time Tuesday.

Among exchange traded funds, Innovator IBD 50 (FFTY) climbed 0.1%, while the Nasdaq 100-tracking Invesco QQQ Trust (QQQ) also edged 0.1% higher. The IBD 50 ETF popped back above its 50-day moving average on Thursday, after spending the past two weeks below the line.

The U.S. economy continues to recover from the Covid-19 pandemic, which triggered nationwide lockdowns over a year ago. A resurgence in cases fueled by the more contagious delta variant has recently started to slow down as vaccinations rise.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 35621.82 +164.51 +0.46
S&P 500 (0S&P5) 4538.50 +18.87 +0.42
Nasdaq (0NDQC ) 15155.16 +26.07 +0.17
Russell 2000 (IWM) 227.95 +2.08 +0.92
IBD 50 (FFTY) 49.75 +0.07 +0.14
Last Update: 12:04 PM ET 10/20/2021

Cumulative Covid-19 cases worldwide have topped 242 million, with over 4.9 million deaths, according to Worldometer. In the U.S., cases are approaching 46 million with almost 749,000 deaths.

Growth Stocks To Watch

Netflix (NFLX) stumbled more than 3% early Wednesday, before trimming its loss. Shares remain slightly extended from a 593.39 buy point of a long consolidation, according to MarketSmith chart analysis. After the close Tuesday, the streaming services giant reported Q3 earnings that beat and sales that met views. Netflix added more subscribers than expected and guided higher for the current quarter. But its profit outlook disappointed.

ASML (ASML) lost nearly 5% in heavy trade after nearly retaking its 50-day moving average on Tuesday. Early Wednesday, the chip gear maker reported better-than-expected Q3 earnings. but it missed sales targets and lowered revenue guidance for the current quarter due to a materials shortage in its supply chain.

Novavax (NVAX) gapped down and plunged 24% to a five-month low before cutting its loss to 9% by midday. It’s been stuck below the 200-day line this month. Shares dived after a report said the pharmaceutical company was having difficulties manufacturing a Covid-19 vaccine that meets regulators’ quality standards.

PayPal Sinks On Buyout Report

PayPal (PYPL) fell nearly 3% in fast turnover after getting turned away at its 50-day line. Shares are still building the bottom of a 13-week consolidation with a 310.26 buy point. The consolidation is starting to look like a possible double-bottom base. Most of it so far has formed below the 10-week line, a sign of weakness. PayPal is an IBD Leaderboard stock.

The payments firm is reportedly exploring an acquisition of social media company Pinterest (PINS), according to Bloomberg. Pinterest stock soared 12% in huge volume. It regained its 50-day line on Tuesday.

Over in the IBD 50, Dynavax Technologies (DVAX) soared 6% as it continues to trade along its rising 10-week line. The stock remains well extended from a 10.45 buy point of a cup with handle. The biotech has a highest possible 99 Composite Rating, which gives investors a quick way to gauge a stock’s key growth traits.

Lovesac (LOVE), Celsius (CELH) and Penske Automotive Group (PAG) advanced more than 2% each.

But Dutch Bros (BROS) fell 5% after reversing lower and is now below the 62.10 buy point of Tuesday’s breakout. The coffee chain was discussed in IBD 50 Stocks to Watch.

Dow Jones Movers

Verizon (VZ), up 2.5% in heavy volume, was the biggest gainer in the Dow industrials. It’s on track for the fifth advance in six sessions. But the stock remains below its 50-day and 200-day lines and is still 13% off its 52-week high. Early Wednesday, the wireless giant reported mixed quarterly results, topping earnings estimates but missing sales targets.

Among other Dow Jones winners, Dow Inc. (DOW), Travelers (TRV) and UnitedHealth (UNH) were up about 2% each.

But Salesforce.com (CRM) fell 1% to lead the downside. The stock, which marked a new high Tuesday, is now back near the top of buy range from a 275.32 buy point of a cup with handle. The buy range goes up to 289.09.

Other Dow losses were even milder. McDonald’s (MCD), Disney (DIS) and Visa (V) gave up roughly 0.5% apiece.

Follow Nancy Gondo on Twitter at @IBD_NGondo

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