The Dow Jones Industrial Average dipped but the Nasdaq fell harder as tech stocks got squished. Twitter (TWTR) rallied out of negative territory after Tesla (TSLA) CEO Elon Musk opted not to join its board. Nvidia (NVDA) was smacked lower while Microsoft (MSFT) and Apple (AAPL) were among the worst blue chips.
A few stocks still attempted breakouts despite the negative action. Franco-Nevada (FNV), Sprouts Farmers Market (SFM) and GlaxoSmithKline (GSK) all tested entries.
Volume was higher on both the New York Stock Exchange and the Nasdaq according to early data, a negative on a down day. Volatility spiked, with the Cboe Volatility Index, or VIX, rising 15%.
Meanwhile, the yield on the benchmark 10-year Treasury note rose seven basis points to 2.79%. Crude oil fell, with West Texas Intermediate crude dipping 3.6% to about $95 per barrel.
Nasdaq Slammed As Tech Stocks Struggle
The Nasdaq fared worst out of the major indexes, closing down 2.2%. Idexx Laboratories (IDXX) was among the worst performers as it fell 6%.
The S&P 500 also tumbled, slipping 1.7%. Occidental Petroleum (OXY) was among the worst laggards here as it dipped 6.3%.
U.S. Stock Market Today Overview
|Last Update: 4:12 PM ET 4/11/2022|
The S&P sectors all ended the day negative. Industrials and materials turned in the smallest losses while technology and energy suffered the worst declines.
Small caps fared better than the major indexes, with the Russell 2000 falling 0.7%.
Growth stocks were mauled by the bears though. The Innovator IBD 50 ETF (FFTY), a bellwether for growth stocks, closed down 1.9%.
Dow Jones Falls As Microsoft, Apple Stock Fall
The Dow Jones fared best out of the major indexes, but still gave up about 400 points as it fell 1.2%.
Microsoft stock was the worst performer on the Dow Jones today as it dipped 3.9%.
The IBD Long-Term Leader, gapped lower as it lost more ground on its 200-day moving average. MSFT stock is also working on a consolidation, but the official buy point of 349.77, is a long way off.
Apple stock slipped 2.6% lower. This caused it to lose ground on a double-bottom pattern entry. The ideal buy point here is 176.75, according to MarketSmith analysis. It has also formed a new handle, which offers a higher 179.71 buy point.
Apple‘s EPS growth has averaged 65% over the past three quarters. This is comfortably clear of the 25% earnings growth sought by the CAN SLIM cognoscenti. Analysts see earnings growth of 10% in fiscal 2022 and 7% growth in 2023.
Twitter Stock Rallies Amid Elon Musk Move
Twitter stock fought its way out of the red to close the day 1.7% higher. It had initially fallen after Tesla CEO Elon Musk decided not to join Twitter’s board of directors.
The decision was announced by Twitter CEO Parag Agrawal announced Musk’s decision, though no specific reason was given. Whether it means Musk will look to build a bigger position in the stock than he would be allowed as a board member or if he wants a more hands off role remains to be seen.
Had he had accepted a seat on the Twitter board, Musk would only be allowed a maximum stake of 14.9% in the company.
Twitter stock surged 17.6% last week before being turned away at the 200-day moving average. The stock exploded after Musk disclosed a 9.2% stake in the company.
The Donald Trump SPAC Digital World Acquisition (DWAC), the future home of the rival Truth Social network, fell 1.8%.
Nvidia Stock Smacked Lower
Nvidia ended the day down 5.2% as it posted a fifth straight decline.
This is the stock’s worst five-day stretch since the March of 2020, when it fell 20%, according to Dow Jones Market Data.
Investors were weighing the chip giant’s announcement it is seeking shareholder approval to double the number of authorized shares to 8 billion. This will enable the firm to take actions such as stock splits and issuing equity incentives without the need for another shareholder vote.
It was also dealt a blow after Robert W. Baird downgraded Nvidia stock from outperform to neutral. The price target was slashed from 360 to 225.
Analyst Tristan Gerra believes order cancellations have started in consumer graphics chips. A number of factors are in play, including excess supplies in Western Europe and Asia, and a slowdown in consumer demand, notably in China.
Nvidia is a member of the prestigious IBD Leaderboard list of top stocks.
Gold Stock Leads Names Testing Entries
Gold stock Franco-Nevada closed below its entry after earlier rising past a flat base with a buy point of 168.47, according to MarketSmith analysis.
The relative strength line hit fresh heights, which is a positive sign. It is also well clear of its 50-day moving average.
The stock boasts solid earnings and top-notch stock market performance. A 93 Relative Strength Rating means FNV sits within the top 7% of stocks in terms of price gains over the past 12 months.
Sprouts Farmers Market also closed under its buy point after earlier peeking above a flat base’s entry of 35.07.
Big money has been snapping up the stock of late, which makes it worth watching as a defensive play. It has an Accumulation/Distribution Rating of B+.
Pharma stocks have been doing well, and GlaxoSmithKline is worth keeping an eye on after it briefly moved past a cup-base entry of 46.96, or a dime above the cup’s left-side high.
The relative strength line is particularly impressive on its weekly chart, rising almost vertically to a new recent high.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.
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