The Dow Jones Industrial Average climbed Wednesday ahead of a big day of economic and earnings news, including the Federal Reserve's interest-rate hike decision. The 10-year Treasury yield ticked higher, not far off Monday's new high. AMD stock and LTHM surged on strong earnings results.
Key earnings movers Wednesday included Advanced Micro Devices, Barrick, IBD Leaderboard stock Cheniere Energy, CVS Health and Regeneron Pharmaceuticals. Livent spiked more than 24% after significantly boosting earnings and revenue guidance late Monday.
AMD stock jumped 7% on better-than-expected earnings results. Barrick was slightly higher. Cheniere advanced 5% and is nearing a 149.52 flat-base entry. CVS shares rallied around 1%. And Regeneron stock was up about 0.5% in morning trade.
Amid the stock market rally attempt launched Monday, Dow Jones leader Merck — along with Exxon Mobil, Nutrien and World Wrestling Entertainment — are Wednesday's top stocks to watch.
Dow Jones Today: Treasury Yields, Oil Prices, Fed Meeting
After Wednesday's open, the Dow Jones Industrial Average moved up 0.4%, while the S&P 500 gained 0.15%. The Nasdaq quickly erased early gains in morning trade and turned 0.3% lower.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust moved down 0.3%. The SPDR S&P 500 ETF climbed 0.15%.
The 10-year Treasury yield ticked higher to 2.99% Wednesday morning. On Monday, the 10-year Treasury yield hit a new 52-week high and reached its highest level since December 2018, briefly surpassing 3%.
Meanwhile, U.S. oil prices advanced more than 4%, prodded by discussions in Europe of extending the ban on purchases of Russian oil, and ahead of Thursday's meeting of Organization of Petroleum Exporting Countries. West Texas Intermediate crude traded just below $107 a barrel.
The Fed's two-day policy meeting wraps up with an interest-rate decision at 2 p.m. ET, followed by comments from Fed Chairman Jerome Powell. Markets fully expect policymakers to announce a half-point rate-hike when this week's Federal Reserve meeting finished. That's expected to be followed by more of the same — if not an even bigger hike — in the next two Fed meetings. Any significant deviation to those expectations could stir a market reaction.
ADP's monthly employment report showed that private payrolls increased by 247,000 in April, far below the Econoday estimate for an increase of 398,000.
March import/export data from the Commerce Department and two key purchasing managers indexes are also due out ahead of the Fed's policy announcement.
Stock Market Rally Attempt
On Tuesday, the major stock indexes rallied modestly, adding to Monday's gains. In technical terms, Tuesday was Day 2 of a new rally attempt. That means a follow-through day — which would launch a new confirmed uptrend — could potentially occur as soon as Thursday.
Still, investors should remain on the defensive. That means avoiding new purchases until a follow-through day. For now, keep a watchlist of stocks holding up well in a down market. They could be some of the stock market's leaders in the next uptrend.
Searching for the next uptrend's leaders while the market is still correcting is a challenge. One helpful method is to use a stock's relative strength line. The RS line measures a stock's price performance vs. the S&P 500. If the stock is outperforming the broader market, then the RS line angles upward. If a stock is performing worse than the broad market, then the line will point lower.
Tuesday's The Big Picture column commented, "Mild action on the stock market is often the calm before the storm ahead of big news. And that looked to be the case Tuesday, when indexes struggled to move decisively as the latest meeting of the Federal Reserve kicked off."
If you're new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one key to the investment guidelines. IBD offers a broad range of growth stock lists, such as Leaderboard and SwingTrader.
Dow Jones Stocks To Watch: Merck
Dow Jones drug stock Merck is below a cup-with-handle base's 89.58 buy point following a brief breakout attempt last week. Shares dipped 0.6% Tuesday, ending about 3% below the latest entry. Merck stock traded down 0.6% Wednesday morning.
On a positive note, the stock's relative strength line recently hit new highs, indicating big stock market outperformance during the current stock market correction.
Stocks To Watch: Exxon, Nutrien, WWE
Last week, energy giant Exxon Mobil added a handle to a cup base, lowering the correct buy point from 91.61 to 89.90, according to IBD MarketSmith chart analysis. Shares gained more than 2% Tuesday, moving just 2% away from the latest buy point. Rising oil prices helped boost Exxon stock 1.5% early Wednesday.
IBD Leaderboard stock Nutrien is rebounding from its 50-day line, a key support level, amid two straight days of gains. Shares rallied 6.5% Tuesday. Nutrien stock moved up 1.2% Wednesday morning.
World Wrestling Entertainment is back above its 50-day moving average after Tuesday's 0.6% rise. The advance carried in weak trade, however, and a more decisive retake of the 50-day benchmark would be bullish for the stock's prospects. Meanwhile, shares are just below a 60.94 buy point in a cup with handle. WWE shares were up 0.3% Wednesday morning.
Tesla stock lost 0.5% Wednesday morning, still looking to extend a win streak to three sessions. Shares are trying to retake their 200-day line, but remain sharply below their 50-day line following last week's 13% dive.
Shares of the EV giant finished Tuesday about 21% away from a cup-with-handle base's 1,152.97 buy point. The stock traded as high as 1,243.49 on Nov. 4 and is about 27% away from that all-time high.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares rebounded 1% Tuesday, finishing just below its long-term 200-day line. Apple stock rose 0.2% Wednesday.
Software leader Microsoft slipped 0.95% Tuesday, giving up a part of Monday's 2.5% gain. Shares are sharply below their 50- and 200-day lines. The stock closed around 20% off its 52-week high. MSFT shares moved up 0.1% Wednesday morning.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.