Dow Jones Drops As Inflation Heats Up; Apple Sells Off On iPhone News

By SCOTT LEHTONEN

The Dow Jones Industrial Average dropped 200 points Wednesday, as a key inflation gauge outran estimates. Apple stock sold off on iPhone news, while Dow Jones stock JPMorgan slid despite strong earnings results.

Among the Dow Jones leaders, Apple sold off 1.3% Wednesday, while Microsoft moved up 0.9% in today's stock market. American Express, Merck and Salesforce.com eyed new buy points in the current stock market correction. And JPMorgan slid over 2% despite strong earnings results.

Tesla gained 0.5% Wednesday, on pace to extend a win streak to three sessions.

Among the top stocks to watch, Advanced Micro DevicesNetflix and Palo Alto Networks are in or near new buy zones, although the market, for now, remains in a correction.

Advanced Micro Devices, Microsoft and Tesla are IBD Leaderboard stocks. Palo Alto Networks is an IBD SwingTrader stock. Microsoft and Salesforce featured in this week's Stocks Near A Buy Zone column.

Dow Jones Today: Inflation Picks Up

The Dow Jones Industrial Average moved down 0.3%, while S&P 500 lost less than 0.1%. The Nasdaq composite rallied 0.4% in midday trade.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 34179.55 -198.79 -0.58
S&P 500 (0S&P5) 4336.14 -14.51 -0.33
Nasdaq (0NDQC ) 14492.10 +26.17 +0.18
Russell 2000 220.68 -0.84 -0.38
IBD 50 47.37 +0.28 +0.59
Last Update: 10:26 AM ET 10/13/2021

Consumer prices increased more than expected in September, the Labor Department reported Wednesday. The consumer price index rose 0.4% for the month and 5.4% year over year. Econoday estimates expected inflation to rise 5.3% in September from a year earlier and a seasonally adjusted 0.3% in September from August. The 10-year Treasury yield dropped 4 basis points, to 1.54%.

Meanwhile, at 2 p.m. ET, Fed minutes from the September policy meeting will be released.

Among exchange traded funds, Innovator IBD 50 gained 0.7% Wednesday. Nasdaq 100 tracker Invesco QQQ Trust rose 0.5%. And the SPDR S&P 500 ETF descended 0.1%.

Stock Market ETF Strategy And How To Invest

Stock Market Rally Attempt

The Nasdaq and S&P 500 continue to hold above last week's correction lows, but both extended losing streaks to three sessions with modest losses Tuesday. Meanwhile, the Dow Jones Industrial Average again found resistance at its 50-day moving average. Still, the current rally attempt continues.

On Tuesday, The Big Picture commented, "Like some panelists on IBD Live like to say, technically, both the S&P 500 and the Nasdaq stand in no man's land — that is, we see both indexes in the region between the 50-day and 200-day moving averages. This makes it awfully difficult, if not impossible, to determine which direction is next for stocks."

For more stock market commentary, check out IBD's The Big Picture.

Five Best Dow Jones Stocks To Watch Now

Dow Jones Earnings: JPMorgan

JPMorgan reported better-than-expected Q3 earnings early Wednesday. JPMorgan earnings per share jumped to $3.74 a share. Revenue rose slightly to $30.44 billion. Both numbers topped estimates.

Shares slid over 2% in morning trade, giving up a cup with handle's 163.93 buy point, according to IBD MarketSmith chart analysis.

Dow Jones Stocks To Watch: American Express, Merck, Salesforce

Dow Jones leaders American Express, Merck and Salesforce are blue chip stocks to watch in today's stock market action.

IBD SwingTrader stock American Express is approaching a 179.77 buy point in a cup with handle, according to IBD MarketSmith chart analysis. Shares were down 2.6% Wednesday and are about 4% away from the new buy point.

Merck dropped 0.4% Wednesday, threatening to extend a losing streak to four sessions. Shares remain in buy range, but breakout gains are mostly gone. On Oct. 1, Merck stock broke out past a 79.33 buy point in a flat base after the company said the Covid drug reduced the risk of hospitalization by half in a final-phase study.

Dow Jones software leader Salesforce is back in buy range past a 275.32 buy point in a cup with handle following a Sept. 23 breakout move. Shares rallied 1.8% Wednesday.

American Express and Salesforce both have a strong relative strength line. Strong relative strength lines during weak general market conditions are indicative of potential market leaders.

Stocks To Watch: AMD, Netflix, Palo Alto

IBD Leaderboard stock Advanced Micro Devices is trying to recapture its 50-day line, rallying nearly 4% Wednesday. AMD is also forming a cup-type base.

According to IBD Stock Checkup, AMD stock boasts a perfect 99 IBD Composite Rating. The IBD Composite Rating identifies stocks with a blend of strong fundamental and technical characteristics.

FANG stock leader Netflix lost 0.1% Wednesday and remains just off new highs. NFLX stock is outside the 5% buy zone past a 593.39 entry point in a consolidation amid the recent global success of its series "Squid Game."

IBD SwingTrader stock Palo Alto Networks is in buy range past a 496.02 entry in a short consolidation. Shares gained 0.6% Wednesday, and are just above the new buy trigger. Bullishly, the stock's relative strength line hit a new high Tuesday, reaffirming the stock's leadership status.

Join IBD experts as they analyze leading stocks in the stock market correction on IBD Live

Tesla Stock

Tesla stock rallied 0.5% Wednesday, on pace to make it three straight up days. TSLA shares are above a 764.55 buy point in a cup with handle.

TSLA shares closed Tuesday about 10% below record highs. On Jan. 25, Tesla stock hit a record high of 900.40, after climbing as much as 93% from a 466 buy point in a cup-with-handle pattern.

Dow Jones Leaders: Apple, Microsoft

Among the top Dow Jones stocks, Apple sold off 1.3% Wednesday after Bloomberg reported the company will likely have to cut 2021 iPhone production goals of 90 million handsets by up to 10 million handsets due to extended chip shortages.

Apple stock is on pace to extend a losing streak to three sessions, falling further below its 50-day line.

Software giant Microsoft gained 0.9% Wednesday, as the stock battles to retake the 50-day line. A new flat base is forming with a 305.94 buy point.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.


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