The stock market indexes continued to weaken in afternoon trading on Thursday, but held onto small gains across the board. Investors remain confident after seeing July's mild inflation numbers.
The July consumer price index and core prices both rose 0.2% to match Econoday's consensus. Year-over-year inflation increased to 3.2% and was slightly lower than the 3.3% projected, but above June's 3.0%.
The 4.7% annual core inflation rate was a tad below the 4.8% expected and equaled June's level.
On Friday, the stock market gets the July Producer Price Index. That gauge is seen rising 0.2% from June with the year-over-year rate up 0.7% and core prices climbing 2.3%. A mild report should further solidify that the Fed won't make any policy changes to its interest rate policy just yet.
Initial weekly jobless claims for the week ended Aug. 5 came in at 248,000 vs. the 229,000 expected and higher than 227,000 in the prior week.
Stock Market Sighs In Relief, For Now
All the major indexes reduced their gains, with the Nasdaq composite up only 0.1% in stock market action. The Dow Jones Industrial Average gained 0.2% and the S&P 500 had only a 0.1% increase. The small-cap Russell 2000 fared worse than the major indexes and fell 0.3%.
The Nasdaq is testing its 50-day moving average. The Dow is trading above its 21-day-exponential moving average, while the S&P 500 fell back below its 21-day line of support.
Meanwhile, the Nasdaq 100-tracking Invesco QQQ Trust ETF bumped up 0.1%. And the Innovator IBD 50 ETF gave back earlier gains, now down 1%.
Volume rose on the NYSE but fell on the Nasdaq vs. the same time on Wednesday.
The benchmark 10-year Treasury yield rose 4 basis point to 4.05%.
Stock Movers: Amphastar Stock Plunges
Amphastar Pharmaceuticals tumbled over 12% on top of Wednesday's 4.3% decline, even though the biotech reported higher-than-expected Q2 profit and sales. Most of its revenue increase came from two products, while other products' sales declined from the same quarter last year.
Gross margin dipped to 50% from 51% in last year's quarter. The IBD 50 stock sank below its 50-day line in heavy volume Thursday. Combined with the heavy price drop, the stock triggered a sell signal.
CyberArk Software gapped up over 12% in heavy volume after the cybersecurity company reported a surprise second-quarter profit and higher sales than Wall Street expected. Quarterly EPS was 3 cents vs. the 27-cent loss in last year's same quarter, while sales grew 23.6%.
The stock reclaimed its 50-day and 200-day moving averages. Shares are in a long consolidation with a 165.18 buy point.
Analysts project full-year EPS of 28 cents, then an explosion to $1.25 next year, according to IBD MarketSmith.
Alibaba Group jumped 5.3% after the China-based online retailer reported a beat on fiscal Q1 top and bottom lines.
Fashion brands stock Capri Holdings surged over 56% in huge volume on news it plans to be acquired by Tapestry for $8.5 billion in cash. Tapestry expects the combined sales of the two companies to top $12 billion annually, according to the Wall Street Journal. Capri shares are on pace for its largest one-day increase on record.
Tapestry gapped down over 14% in heavy trading to fall below its 200-day moving average on the news. Tapestry stock is on track for its largest decrease since March 7, 2022, when it fell 11.9%, and it's the S&P 500's worst performer today.
Capri owns luxury brands including Michael Kors, Jimmy Choo and Versace, while Tapestry owns the familiar Coach and Kate Spade brands.
Meanwhile, shares of competitor Ralph Lauren fell 3.8% after the company reported better-than-expected fiscal first-quarter earnings and sales, but said it expects flat to slightly higher fiscal Q2 revenue. Shares are testing the 50-day line.
Market Rebound Fizzles; AI Leader Nvidia Fades
Other Market Movers: Yeti Stock Soars
AppLovin soared over 24% after the gaming app developer reported higher-than-expected second-quarter earnings and sales and gave Q3 revenue guidance that exceeded analysts' estimates.
Outdoor products maker Yeti Holdings gapped up over 19% in heavy volume after the company reported a mixed Q2 earnings report, but raised its full-year adjusted EPS and sales growth forecast. Shares are near the 49.02 buy point of a long consolidation, but topped an alternative entry at 45.32.
Walt Disney stock rose 4.4% after the company reported a beat on fiscal third-quarter profit and a miss on sales late Wednesday. Streaming subscribers fell, while Disney Parks, Experiences and Products revenue increased over the prior year.
Disney's ESPN partnered with Penn Entertainment on a gambling sportsbook, the companies announced late Tuesday. Penn Entertainment will rebrand its Barstool Sportsbook as ESPN Bet, which will launch this fall in 16 legalized-sports-betting states where Penn is licensed. PENN stock sold off 4%.
IBD 50 stock Trade Desk fell another 4.6% to add to Wednesday's 5.1% sell-off. Shares are below the 50-day line and giving a sell signal.
Leaderboard stock Nvidia reversed earlier gains and is down 0.7%, trading just below its 50-day line.
Follow Kimberley Koenig for more stock market news on Twitter @IBD_KKoenig.
