Banking

Dow Flat Amid Fed Concerns; Synopsys Soars, Robinhood Dives

Stocks were mixed Thursday afternoon, with the Dow Jones Industrial Average leading the downside amid concerns stemming from the latest Fed minutes. But other indexes rose.




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The Nasdaq and the S&P 500 rose 0.2% and the Dow Jones industrials gave up 0.2% in the stock market today. The Nasdaq and Dow are testing their 50-day moving averages. Small caps tracked by the Russell 2000, down 1.4%, lagged. Volume was higher on both major exchanges vs. the same time Wednesday.

Among exchange traded funds, Innovator IBD 50 (FFTY) pulled back 0.7%, while the Nasdaq 100-tracking Invesco QQQ Trust (QQQ) gained 0.7%.

Initial jobless claims fell to 348,000 the week ended Aug. 14, the Labor Department reported early Thursday. That was the lowest level since the start of the pandemic, and well below economist forecasts for 360,000 claims and the prior week’s 377,000. It also marked the fourth straight weekly decline.

On Wednesday, minutes from the Federal Open Market Committee’s July meeting showed several policymakers leaning to start tapering monthly bond purchases by year-end. Some thought the process should start later, in early 2022.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 34921.81 -38.88 -0.11
S&P 500 (0S&P5) 4410.94 +10.67 +0.24
Nasdaq (0NDQC ) 14573.52 +47.61 +0.33
Russell 2000 (IWM) 212.28 -2.23 -1.04
IBD 50 (FFTY) 44.86 -0.16 -0.36
Last Update: 3:10 PM ET 8/19/2021

The U.S. economy continues to recover from the Covid-19 pandemic, which triggered nationwide lockdowns over a year ago. Most states had relaxed restrictions as vaccinations continued to roll out and cases decreased.

But cases are rapidly rising again and mask mandates are returning in some states as the delta variant spreads.

Cumulative Covid-19 cases worldwide have topped 210 million, with over 4.4 million deaths, according to Worldometer. In the U.S., cases are approaching 38.1 million with more than 641,000 deaths.

Growth Stocks To Watch

Nvidia (NVDA) surged more than 6% in heavy volume after its Q2 results topped views late Wednesday. The graphics chip designer earned an adjusted $1.04 a share on sales of $6.51 billion, vs. FactSet forecasts for $1.02 a share on sales of $6.33 billion. It also guided higher for the current quarter.

Shares are approaching a 207.43 buy point of a cup with handle, according to IBD MarketSmith chart analysis. Nvidia is an IBD Leaderboard stock. It pared its gains in late afternoon trading.

Chip-gear maker Applied Materials (AMAT) added 1% ahead of its earnings due after the close. Shares are about 12% away from a 146.10 buy point of a 20-week consolidation. Analysts expect AMAT to earn an adjust $1.76 a share on revenue of $5.92 billion, according to Zacks. That would mark respective profit and sales growth of 66% and 35%.

Synopsys (SNPS) gapped up and soared nearly 9% in fast turnover to a new high. Late Wednesday, the chip design software maker delivered a narrow fiscal Q3 beat. It earned an adjusted $1.81 a share on sales of $1.06 billion. Analysts expected $1.78 a share on sales of $1.05 billion, according to FactSet.

Shares are now well extended from a 283.19 buy point of a cup with handle cleared in July. Synopsys is an IBD Long-Term Leader stock.

But Robinhood (HOOD) gapped down and dived 10% after the stock trading app’s Q2 results late Wednesday. It reported an adjusted loss of 60 cents a share on revenue of $565.3 million. Robinhood stock is nearly 50% off its Aug. 4 high. It held an IPO on July 28, pricing 55 million shares at $38 a share to raise $2.1 billion.

Inside The IBD 50

In addition to Nvidia, InMode (INMD) led the IBD 50 with a nearly 5% gain. It’s on track for a third straight advance. The stock is rebounding off its 10-week moving average, which set up a chance for investors to buy or add shares. But since it’s up more than 20% from an 87.10 buy point, they could also lock in some profits. InMode is an IBD Sector Leader, a list of the best growth stocks.

Monolithic Power Systems (MPWR) and Maravai Lifesciences (MRVI) added about 2% apiece.

But Upstart Holdings (UPST) and Cleveland-Cliffs (CLF) tumbled roughly 7% each. Upstart fell back into buy range from a 191.99 entry of a cup base cleared on Friday.

Cleveland-Cliffs dropped below a 24.87 consolidation buy point. It’s testing the 50-day line and also triggered the 7%-8% loss-cutting sell rule on the way down.

Among other IBD 50 losers, Moderna (MRNA) and Doximity (DOCS) gave up about 5% each.

Dow Jones Winners And Losers

Big cap tech stocks were mostly higher Thursday. Cisco Systems (CSCO) led the upside with a 3% gain in heavy volume to its highest level in over two years. Shares remain in buy range from a 55.45 flat-base entry. The buy range tops out at 58.22.

Late Wednesday, the networking giant reported fiscal Q4 EPS of 84 cents on revenue of $13.1 billion. Analysts polled by FactSet forecast 83 cents on revenue of $13.04 billion. For the current quarter, Cisco expects 80 cents, a penny below views. But its revenue growth outlook of 8.5% at the midpoint of its guidance was above estimates.

Among other gainers in the Dow industrials, Microsoft (MSFT), UnitedHealth (UNH) and Salesforce.com (CRM) added more than 1% each.

But Caterpillar (CAT), Boeing (BA) and Chevron (CVX) weighed with losses of about 2.5% each.

Follow Nancy Gondo on Twitter at @IBD_NGondo

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