The Dow Jones Industrial Average traded at session highs Tuesday afternoon. Investors continued to digest earnings reports this week and are preparing for more earnings news from the likes of Netflix (NFLX) and IBM (IBM) after the market close.
In early-afternoon trading, the Dow Jones industrials traded up 1.1%. The index successfully tested support at the 50-day line on Monday and reclaimed its 21-day exponential moving average on Tuesday. The Nasdaq was up the most, rising 1.8%. The index remained below 21-day and 50-day moving averages.
The S&P 500 rose 1.2% and is reaching for its 21-day line. The index is currently above its 50-day line. The small-cap Russell 2000 gained 1.9%, outperforming the other indexes. Volume was higher on the Nasdaq and lower on the NYSE vs. the same time on Monday.
The Innovator IBD 50 ETF (FFTY), a benchmark for growth stocks, gained 0.5%. Last week, the ETF broke below the 50-day line after finally reclaiming this level in mid-March. Growth stocks have struggled more than most in the recent market.
U.S. Stock Market Today Overview
|Last Update: 3:30 PM ET 4/19/2022|
Money flowed out of bonds again as the yield on the benchmark 10-year Treasury note continued to inch higher, hitting 2.92% in Monday’s market. The bond market continues to price in aggressive rate hikes by the Federal Reserve this year.
Meanwhile, West Texas Intermediate crude fell 5.2% to around $102 a barrel. As for the S&P 500 sectors the majority traded higher while only energy fell. Consumer discretionary and communication services led the upside with gains of 2.5% and 1.7%, respectively. Energy stocks fell roughly 0.7%.
Stocks With Earnings: Netflix, Lockheed
Among top stocks reporting earnings, Netflix is set to announce Q1 results after the close today. Shares rose 3% ahead of the earnings release. Investors are preparing for a slowdown in growth for the online streaming platform amid its exit from Russia.
Analysts expect revenue of $7.95 billion, above the $7.16 billion in the same quarter a year earlier. EPS is expected to come in at $2.91. Net new subscribers of 2.51 million are expected, which would be the smallest quarterly addition for Netflix since the second quarter of 2021. For comparison, subscribers grew by nearly 4 million in the same quarter a year earlier.
Additionally, Lockheed Martin (LMT) beat analysts’ expectations for EPS but missed sales projections. Shares fell 1.8%, but in lighter-than-normal volume. Lockheed earnings came in at $6.44 a share, with revenue at $14.96 billion. Analysts expected a 7% decline in earnings to $6.11 per share on a 4% revenue drop to $15.579 billion, according to FactSet.
The defense stock is still nearing a 480.09 flat-base buy point. Lockheed is among several defense plays that have powered higher amid Russia’s Ukraine invasion.
Dow Jones Stocks With Earnings
Over in the Dow Jones, Johnson & Johnson (JNJ) reported earnings, which propelled the stock over 3% higher as it outperformed other blue chips. The stock rose in strong volume and became extended from a 173.72 buy point of a double-bottom base. The stock had been trading in the buy zone for several weeks. The company reported EPS of $2.67 on revenue of $23.4 billion.
Another Dow Jones giant, IBM (IBM), is expected to report earnings after the close. Shares were up over 2% and regained their 21-day and 50-day lines, a bullish sign. But IBM stock remains sluggish.
Follow Rachel Fox on Twitter at @IBD_RFox for more Dow Jones and stock market commentary.
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