The Dow Jones Industrial Average fell 0.9% in early trading Tuesday after strong jobs data. The index is testing June’s lows as yields continue to spiral upward.
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The S&P 500 fell 1% at 10:30 a.m. ET in the stock market today. The index undercut last week’s low.
The Nasdaq fell nearly 1.5% after rebounding from August’s lows in a four-day rally attempt. A follow-through day remains elusive.
Volume on the NYSE was lower and higher on the Nasdaq compared with the same time on Monday.
The small-cap Russell 2000 also fell over 1%, as did the Innovator IBD 50 ETF (FFTY).
The Job Openings and Labor Turnover Survey (JOLTS) for August came in at 9.61 million, well above consensus views of 8.75 million. It rose from July’s 8.827 million, according to Econoday. The strong labor market could give the Fed more reason to raise Fed funds interest rates. September’s nonfarm payroll data will be released Friday after Thursday’s ADP employment report for September.
On Tuesday, Atlanta Fed President Raphael Bostic indicated that rates would stay high for some time. The IBD/TIPP U.S. Economic Optimism Index fell to a 12-year low in October.
The yield on the benchmark 10-year Treasury note rose a further 7 basis points to 4.76% after hitting 16-year highs on Monday. The U.S. dollar continued its ascent as odds of another rate hike this year hover at 25.7% for November, going up to 38.2% for December.
Gold fell earlier but reversed slightly higher. Crude oil fell less than 0.5% to trade at $88.70 a barrel.
Dow Jones Stocks
In the Dow, Intel (INTC) retook its 50-day moving average. Nike (NKE) rose and is holding the bulk of its gains after an earnings gap up last week. Among other tech leaders, Apple (AAPL), Microsoft (MSFT) and Salesforce (CRM) fell and remain below their 50-day lines.
Outside the Dow, Eli Lilly (LLY) fell and is testing the 50-day line after news that it will buy Point Biopharma Global (PNT) for $1.4 billion. PNT stock surged over 80%.
HP (HPQ) rose after Bank of America upgraded the stock to buy from underperform. Value investor Warren Buffett is reported to have sold 5.1 million shares of the computer hardware maker for around $130 million. HPQ stock remains well below its 50-day line.
McCormick, Airbnb Among Movers
Spice maker McCormick (MKC) plunged after fiscal third-quarter results were announced. Earnings declined to 65 cents per share from 69 cents in the prior year’s quarter. Sales rose 6% to $1.68 billion. For the full year, the company expects a midpoint sales growth of 6% through pricing moves and cost savings to counter inflationary pressures.
Also in the food sector, Cal-Maine (CALM) reports after the market close. The egg producer’s stock has fallen this week and is testing its 50-day line ahead of earnings.
Airbnb (ABNB) got a downgrade from KeyBanc to sector weight from overweight. Analysts, who did not give a price target, see demand for leisure travel fading. ABNB stock fell below its 50-day line but is still forming a cup with handle.
Digital freelance platform Fiverr (FVRR) rose 2% on an upgrade from Roth MKM to buy from neutral with a price target of 33. Shares face resistance around 30. Analysts at UBS upgraded Warner Music Group (WMG) to buy from neutral. Shares are trying to retake the 50-day line.
Energy stocks in the IBD 50 continued to fall amid wider weak action. Tidewater (TDW) and Liberty Energy (LBRT) remain above the 50-day line as they pull back.
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