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Tech stocks drove the market into steep losses early on Tuesday, before Fed Chief Jerome Powell testified in the Senate. The $ 1.9 trillion federal stimulus package was brought forward in the House on Monday night, helping to spike oil prices and reopen some pandemic rooms. The revenue news triggered ZoomInfo and sent Nexstar Media into a buying lineup. Meanwhile, The Home Depot swung low on the Dow Jones today, following its fourth quarter report.
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The Nasdaq Composite dropped 3.5% at the starting bell as Baidu (BIDU) and You’re here (TSLA) fell more than 11% each at the starting bell. The S&P 500 opened at a loss of 1.4%. Dow industrials lost more than 200 points, down 0.7%. Procter & Gamble (PG) dominated the Dow Jones today, up nearly 3%.
Etsy (ETSY), Tesla and Enphase Energy (ENPH) traded lowest among S&P 500 stocks. CBRE Group (CBRE) and Additional storage (EXR) led, up more than 5% each on earnings news.
Revenue News: ZoomInfo Spikes, Nexstar Releases
In the income news, Nexstar Media Group (NXST) and IBD Leaderboard stock ZoomInfo (ZI) rose after releasing its results on Monday night.
ZoomInfo rose more than 10% after beating analysts’ fourth-quarter revenue and profit forecasts on Monday night. At least four analysts raised the price targets for the share on Tuesday morning. Piper Sandler weighed in at the top of the list with a price target of 70. ZoomInfo stock has been volatile, reversing an 11% lead from a February 3 breakout and plunging back below the buy point of 53. 18 – as well as the reduction of support to its exponential 21-day moving average on Monday.
Technically, the pullback triggered a sell rule, but it stopped before triggering the automatic stop loss rule. Tuesday’s pre-market action indicates that the action recaptures the buy point at the start of the trade, a valid buying opportunity. But investors should be sure to keep the change in status of the uptrend in mind, especially before diving into volatile young stocks with recent initial public offerings.
Texas-based TV broadcaster Nexstar Media Group jumped 4.6% after its healthy fourth quarter report. The move sent the stocks into a buy range above a 131.10 buy point in a 12-week ascending basis. The buy range extends to 137.66.
Dow Jones Today: Home Depot Breaks Support
Home Depot (HD) slumped 5% on the Dow Jones today, despite strong fourth quarter results and slumped earnings Monday night. The company also increased its quarterly dividend by 10%, to $ 1.65 per share.
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The drop pushed Home Depot’s stock to drop below its 10-week moving average. The stock has been hovering above and below the line since August, forming a 26 week flat base in the process. The base has a buy point of 293.05. Stocks closed 6% below that entry on Monday.
Stimulus set for voting on the floor of the House
In Washington, the House Budget Committee on Monday passed President Joe Biden’s $ 1.9 trillion US bailout after a 19-16 vote, with Republicans opposing the measure. The move prepares the package for a House floor vote later this week. House Democrats aim to have the package ready for the president to sign before the current supplementary unemployment benefits expire on March 14.
Federal Reserve Chairman Jerome Powell is due to address the Senate Committee on Banking, Housing and Urban Affairs at 10 a.m. ET.
Bonds, flat copper; Oil at 13-month high
Among other US markets, bonds flattened, with the 10-year yield standing at 1.36%, up sharply from lows of around 0.50% in August. Yields had started 2020 at around 1.8%, down from around 2.7% a year earlier.
Oil prices rose, with West Texas Intermediate crude up 0.5% to over $ 62 a barrel, and its highest level since January 8, 2020. The benchmark for Brent in Europe is rose to nearly $ 66. Copper also halted its rally, with futures stable at around $ 4.15 a pound, the highest mark since July 2011.
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Bitcoin Dips Below $ 46,000
Bitcoin recovered some early losses on Tuesday, after falling below $ 46,000 to its lowest level since Feb.11, according to CoinDesk. Bitcoin had climbed to a record above $ 58,000 on Sunday.
Among the actions related to Bitcoin, Marathon Patent Group (MARA) tanked 15%, while MicroStrategy (MSTR) recorded a decrease of 7.4%. The Amplify Transformational Data Sharing (BLOK) ETF fell 10.5%.
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IBD Ranking Stock PayPal funds (PYPL) fell 6.5%. PayPal shares have been affected by bitcoin price fluctuations to some extent since October, when the company launched a cryptocurrency trading service that trades Bitcoin. The loss is leading PayPal stock to fall below its 21-day moving average and a possible test of support at its 10-week line.
Coronavirus update: 41-day decline ends
As the cumulative death toll from the coronavirus pandemic in the United States climbed above 500,000 on Monday, the seven-day average of new Covid-19 cases reported daily in the United States and around the world has risen to the first time in 41 days. New cases reported worldwide, on average over the previous seven days, rose to 360,341 on Monday. That’s more than 50% below the high of 745,985, recorded on January 11.
In the United States, the seven-day average of new reported cases rose to 69,528 on Monday, down more than 72% from the high of 255,258 reached on January 11, according to Worldometer.
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Deaths also increased for a second day. The seven-day average of daily reported deaths rose to 2,042 on Monday. The daily average of reported deaths had fallen for 25 days after peaking at 3,447 on January 26.
The Centers for Disease Control and Prevention reports that 75.2 million doses of the vaccine have so far been distributed in the United States. Some 64.177 million doses have been administered, meaning that just under 20% of the U.S. population has so far received at least one vaccine.
Among the related actions, Co-diagnosis (CODX) and Modern (MRNA) recorded early hits, down 4.1% and 1.5%, respectively. No clear news was driving the movements.
Dow Jones Today: Salesforce revenue
Long-term leader IBD Salesforce.com (CRM) will be the last report on regular season results among Dow Jones stocks. It is due to release its fourth quarter results after the close on Thursday. Salesforce shares fell 2% when trading on the Dow Jones began today.
Salesforce stock is climbing on the right side of a cup base that formed after a failed November breakout from a double bottom base. MarketSmith places the buy point at 271.02 and Salesforce shares were about 10% below that mark when the trade closed on Friday.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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