The Dow Jones Industrial Average moved higher on Tuesday and reversed some of Monday’s losses. Meanwhile, the Nasdaq and S&P 500 showed similar action and also advanced. Financial stocks led the upside and bond yields continued rising to new highs.
Market conditions continued to improve and the indexes looked strong following last week’s follow-through days on the S&P 500 and Nasdaq. The new market uptrend means it’s still a good time to buy stocks and increase exposure — especially as the indexes are now clearing levels of resistance at key moving averages.
The majority of the S&P 500 sectors traded higher on Tuesday, with the exception of the energy sector, which fell nearly 1%. Financial stocks were among the outperforming sectors as the Financial Select Sector (XLF) exchange traded fund rose 1.7% in early afternoon trade.
After the Federal Reserve announced last week the first in an expected series of interest-rate hikes, Treasury bond yields moved higher this week. The 10-year U.S. Treasury yield ticked up to 2.37%. Monday’s surge to 2.31% left the yield at its highest point since May 2019. On Monday, Fed Chief Powell said in prepared remarks for the National Association for Business Economics that “inflation is much too high” and the Federal Reserve will take the “necessary steps to ensure a return to price stability.”
U.S. Stock Market Today Overview
|Last Update: 1:46 PM ET 3/22/2022|
Wells Fargo (WFC) jumped more than 4% Tuesday, gapping up into the buy range from a flat base with an entry of 52.66. Shares had previously triggered the 7% sell rule from the initial breakout near the end of December. Bank of America (BAC) climbed over 3% while Dow Jones leader JPMorgan (JPM) rose over 2.5%.
Energy stocks declined as U.S. crude futures shifted down 1%, remaining over $110 per barrel. Oil had fallen off highs of over $130 a barrel. Last week, oil fell to around $95, and rebounded from that level.
Dow Jones In The Stock Market Today
In early-afternoon trading, the Dow Jones industrials held a gain of 0.8%. After reclaiming the 50-day line, the index inched closer to regaining its 200-day line as well.
The Nasdaq rose 1.7%, leading the upside and also reclaiming its 50-day line.
The S&P 500 rose 1.1%, and the Russell 2000 traded 0.7% higher. Data showed volume is running lower on the Nasdaq and on the NYSE vs. the same time on Monday.
Among Dow Jones stocks making notable moves, Nike (NKE) held a 2% gain after paring earlier gains and being turned away at the 50-day line of support. The company reported fiscal third-quarter earnings that beat expectations, with earnings of 87 cents per share on revenue of $10.9 billion.
Shares of Caterpillar (CAT) and Johnson & Johnson (JNJ) led the Dow on the downside, with losses of less than 1% each. On the upside, Boeing (BA) led with gains of over 3.5% after yesterday’s sell-off.
Breakouts: Financials, Chemicals And Chip Stocks
A small handful of insurance-related stocks scored breakouts in the MarketSmith Growth 250 index. Jackson Financial (JXN), a retirement planning firm, broke out above a 44.76 double-bottom buy point. The stock’s RS line reached a new high as shares remained inside the buy zone in afternoon trading.
Fellow financial stock American International Group (AIG) edged above the 63.64 buy point of a flat base but faded from the buy point after the breakout.
Elsewhere, Alpha & Omega Semiconductor (AOSL) is among the latest chip stocks breaking out. Shares climbed 10% and broke out above a 59.48 buy point from a cup-with-handle base in heavy trading. The handle in the base is 25% deep, which is much more than normal.
Chemicals company Darling Ingredients (DAR) broke out from an 80.31 buy point of a cup-with-handle. Shares were up almost 4% after fast food chain Chick-fil-A chose Darling to convert its used cooking oil into renewable transportation fuel. Shares have been rising in recent sessions, a bullish sign.
The stock has gotten a seat inside both IBD Leaderboard and SwingTrader.
Follow Rachel Fox on Twitter at @IBD_RFox for more Dow Jones and stock market commentary.
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