The Dow Jones Industrial Average rallied on Friday after the impact of the Labor Department December jobs report. Meanwhile, Tesla stock fell 7%, hitting a new low since then The company has again cut prices in China.
For the December jobs report, nonfarm payrolls rose by 223,000, which was more than the 200,000 workers expected for the month and less than the 263,000 new hires in November. The unemployment rate fell to 3.5% against 3.7%.
Average hourly earnings rose just 0.3%, below estimates of 0.4% and down from November’s 0.6% increase. Per Econoday, November was the seventh month — and ninth in the last 10 months — that wage growth topped estimates.
Meanwhile, the Institute for Supply Management’s December service index is also out on Friday. The ISM services index is expected to expand with a reading of 55.0.
Ulta is beautiful (UltaWells Fargo fell nearly 2% with a reduced price target of 400 after it downgraded shares from equal weight to underweight. Southwest Airlines (LUV) fell 1.5% after warning that its latest flight cancellation costs could be up to $825 million.
Cardinal health (CAH), Deer (DE), Medbase (MEDP) and IBD Leaderboard Stock Neurocrine Biosciences (NBIX) — as well as Dow Jones names caterpillar (CAT), Chevron (CVX) and Walmart (WMT) — top stocks to consider for investor watch lists. Remember that current market weakness should keep investors on the sidelines.
Dow Jones today: Oil prices, Treasury yields
After Friday’s opening bell, the Dow Jones industrial average was up 0.9%, and the S&P 500 was up 0.7%. The tech-heavy Nasdaq composite rose 0.3% in morning action, with Tesla and some China-based names dragged down the list.
The 10-year Treasury yield fell to 3.7% on Friday morning after the December jobs report, adding to Thursday’s modest gains. The 10-year yield is still on pace to fall sharply on the week.
Meanwhile, oil prices extended Friday morning’s gains after Thursday’s rally. West Texas Intermediate futures rose more than 1% to trade above $74 a barrel, set for solid weekly losses.
Natural gas continued its steep decline, with Henry Hub futures initially down more than 3% at $3.59 per million British thermal units. Natural gas prices fell more than 35% in December and are down nearly 20% so far in January.
Stock market correction
On Thursday, the Dow Jones Industrial Average fell 1%, and the S&P 500 fell 1.2%. The Nasdaq composite was off 1.5%.
Thursday’s The Big Picture column Commenting, “Thursday is the 4th day of a rally attempt, so A Possible follow-up day Can happen at any time. However, there are not many leading stocks near new buy points, which is a key factor for successful follow-up days.”
Dow Jones stocks to watch: Caterpillar, Chevron, Walmart
Despite Thursday’s decline of 0.45%, Dow Jones member Caterpillar remained above its flat base’s 239.95 buy point. According to IBD MarketSmith model recognition. The buy zone goes up to 251.95. Shares rose 1.5% on Friday.
Energy giant Chevron pared losses for the week, rallying 1.8% Thursday. Shares remain below their 50-day line as the cup forms a base with a buy point of 189.78. CVX shares rose 1% Friday morning as oil prices rose.
Discount retailer Walmart makes a cup with a handle that has a buy point of 154.74. But shares are below their 50-day range after sharp losses in recent weeks. Walmart shares rose 1.5% Friday morning.
Key stocks to watch: Cardinal Health, Deere, Medbase, Neurocrine
Cardinal Health, The latest IBD Stock of the Day, Thursday fell 0.5%, still below its 50-day line. CAH shares rose 0.7% on Friday.
Latest IBD stock of the day, Deere is building a flat base with a 448.50 buy point, although it gave up support at its 50-day line during Thursday’s 2.1% decline. DE stock was trading up 0.9% on Friday morning.
Medpace fell below support at its 50-day line on Thursday, indicating that the medical leader needs more time to consolidate. This is normal in a market trend in a correction. For now, the perfect buy point is at 235.82, but the previous entry is at 220.09. MEDP stock rose 1% on Friday.
IBD Leaderboard Shares of Neurocrine Biosciences are rebounding from support at its 50-day line. A flat floor is in the offing and could develop as early as this week. If it does, the flat base will show a buy point at 129.39, with an initial entry of 122.93. NBIX stock rose 0.8% on Friday.
Stocks to Watch in Current Stock Market Correction
These are the six best stocks to watch in today’s stock market, including three Dow Jones leaders.
|Name of the company||Symbol||Perfect buying point||Basic type|
|Cardinal health||(CAH)||81.67||Flat base|
|Walmart||(WMT)||154.74||Cup with handle|
Source: IBD data as of January 6, 2023
Tesla stock sinks on China price cuts
Tesla stock Jupiter slipped 2.9%, with Wednesday giving up most of the bounce. This week, shares are at a 52-week low of 104.64 and 73% of the 52-week high.
Shares threatened to add to Thursday’s losses, plunging more than 7% Friday morning. Tesla shares hit a new low in trading as low as 102.13.
Tesla said It has cut the prices of its two most popular electric car models in China, made at the Shanghai factory, by about 6% to 13%. Including recent discounts, Model Y prices now start at the equivalent of around $37,000. The Model 3 starts at approximately $32,700, which is 30% cheaper than the price of the standard Model 3 sold on Tesla’s US website.
Dow Jones Leaders: Apple, Microsoft
in the middle Dow Jones Stocks, Apple shares fell 1.1% on Thursday to close at 124.17, a 52-week low set on Tuesday. The stock is about 32% off its 52-week high. Shares rose 1.1% Friday morning.
Microsoft shares fell another 3% on Thursday, on pace to fall more than 7% on the week. The software company is about 34% off its 52-week high and nearing its 52-week low of 213.43, reached on November 4. MSFT stock was down 0.2% in early Friday trading.
Don’t forget to follow Scott Lehtonen on Twitter @IBD_SLehtonen Learn more about growth stocks and the Dow Jones Industrial Average.
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