Dow Jones, Nasdaq Plummet On Hawkish Fed Comments; Dave & Buster's Breaks Out – Investor's Business Daily

BREAKING: Market Slides As Powell’s Comments Continue To Weigh On Investors 

The Dow Jones Industrial Average and Nasdaq traded sharply lower following Federal Reserve Chairman Jerome Powell’s hawkish speech at Jackson Hole, Wyo. Friday. The Nasdaq led the downside in today’s heavy-volume sell-off.
Index losses deepened into the close. The Dow ended down 3% while the S&P 500 fell 3.4%. Small caps also struggled, with the Russell 2000 declining 3.3%. The Nasdaq fared the worst and lost over 3.9%. Volume was higher on the Nasdaq and NYSE vs. the close on Thursday, according to early data.
Crude oil futures pared early gains but traded slightly higher, up 0.4%. The commodity traded around $92.86 per barrel Friday afternoon. The 10-year Treasury yield showed little movement on Friday after this week’s strong gains, trading at 3.03% Friday.
Investors were clearly unhappy with the U.S. central bank’s commitment to fight inflation. “Restoring price stability will likely require maintaining a restrictive policy stance for some time,” Powell said in his speech. “The historical record cautions strongly against prematurely loosening policy.”
Meanwhile, economic data released Friday morning suggests that inflation is moderating and consumers are waning. Sal Guatieri, senior economist with BMO Capital Markets, noted that personal consumption rose merely 0.1% in July while real spending advanced 0.2%, less than expected. Additionally, core prices rose less than expected, up 0.08% in July, following June’s big 0.6% leap.
“Inflation is still well above the 2% target, but it’s starting to move in the right direction, no doubt benefiting from recent retail discounting to clear out inventories,” Guatieri said.
All 30 Dow Jones stocks traded lower on Friday. Tech giant Salesforce (CRM) led the downside, losing 5%, following Thursday’s earnings-related sell-off. Shares are now down close to 10% for the week. CRM shares sank after the firm lowered its fiscal 2023 revenue outlook, citing currency exchange rates and slowing demand from retail and telecom customers. The Dow Jones component reported July-quarter earnings that fell from a year earlier but exceeded Wall Street targets.
Shares have been tumbling over the past week, undercutting support at their 50-day moving average in strong volume.
MMM (MMM) also led the downside with losses of over 9%. The diversified operations stock slid below its 50-day moving average in heavy volume. Falling below this level would be a bearish sign for the stock, if not a sell signal. MMM also led the downside among S&P 500 stocks.
While no Dow Jones stocks traded higher on Friday, Chevron (CVX) fared the best, losing 0.7%. The oil giant is holding a gain of over 3.5% for the week, contrary to many stocks in today’s market. Shares have recently crossed above their 21-day and 50-day moving averages as oil stocks continue to strengthen.
Chevron is currently 10% below a 182.50 buy point of a cup base. Investors could also consider using a more aggressive buy point above the 164.66 short-term resistance level.
As the market pulled back on Friday, it took many recent breakout stocks down with it. Several stocks inside the IBD 50, including Axcelis Technologies (ACLS) lost recent gains. ACLS stock fell over 11%, triggering the 7% to 8% sell rule just one day after a heavy-volume breakout. Shares of Axcelis broke out above a 79.93 entry on Thursday.
On Friday, shares of Dave & Buster’s Entertainment (PLAY) briefly broke out above a 43.92 cup-with-handle buy point. But the restaurant’s shares immediately reversed lower and are now down over 3%. A reversal on the breakout day is never a good sign. The broad market sell-off is making it hard for most stocks in today’s market. On the positive side, the stock remains above its 21-day exponential moving average.
YOU MIGHT ALSO LIKE:
IBD’s Market Outlook: A Guide To The Different Designations
Get Free Dow Jones IBD Newsletters: Market Prep | Tech Report | How To Invest
What Is CAN SLIM? If You Want To Find Winning Stocks, Better Know It
See IBD Stock Lists & Get Pass/Fail Ratings For All Your Stocks With IBD Digital
Market Rally Feels Powell’s ‘Pain’; What To Do Now
7:13 AM ET Check the Stock Market Today column to spot changes in market trend and track the best stocks to buy and…
7:13 AM ET Check the Stock Market Today column to spot changes in…
IBD’s third annual Most Trusted Financial Companies survey reveals the strength of previous winners and the vigor of newcomers. (© sisti/stock.adobe.com)
Get instant access to exclusive stock lists, expert market analysis and powerful tools with 2 months of IBD Digital for only $20!
Get market updates, educational videos, webinars, and stock analysis.
Learn how you can make more money with IBD’s investing tools, top-performing stock lists, and educational content.
Notice: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. The information has been obtained from sources we believe to be reliable; however no guarantee is made or implied with respect to its accuracy, timeliness, or completeness. Authors may own the stocks they discuss. The information and content are subject to change without notice.
*Real-time prices by Nasdaq Last Sale. Realtime quote and/or trade prices are not sourced from all markets.
Ownership data provided by Refinitiv and Estimates data provided by FactSet.
© 2000-2022 Investor’s Business Daily, LLC. All rights reserved

source

Leave a Reply

Your email address will not be published.