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The Dow Jones Industrial Average reversed for small losses as a Biden administration plan to cut prescription prices hit health stocks. Amgen (AMGN) was the worst blue chips, with Johnson & johnson (JNJ) following closely. Stock Warren Buffett HR (RH) managed to take over a point of purchase, while Lululemon Athletica (LULU) soared higher on income.
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The escapes were slim on the pitch, but there was one notable factor. Isolation game TopBuild (BLD) joined the rankings as a quarter-size position as it passed above a buy point.
Stocks gave up on early accumulated gains following strong jobs data. The Labor Department reported 310,000 jobless claims for the week ended September 4, a new pandemic low. That was lower than the 345,000 revised upward from the previous week and Econoday’s estimate for 344,000 new claims.
Nasdaq remains positive as growth stocks rise
The Nasdaq clung to positive territory before sinking to a slight loss, down around 0.2%. Home fitness game Interactive Platoon (PTON) was the best performer, pedaling almost 8% higher. Biogen (BIIB) was the biggest laggard, dropping almost 8%.
The S&P 500 was forced lower, losing 0.2%. Modern (MRNA) jumped at the news that it was seeking to bring to market a combined vaccine against Covid-19 and influenza, up nearly 7%. Biogen was also the worst performer in the S&P 500.
Snapshot of the US Stock Market Today |
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|---|---|---|---|---|
| Index | symbol | Price | Loss of profit | % Switch |
| Dow jones | (0DJIA) | 34963.70 | -67.37 | -0.19 |
| S&P 500 | (0S & P5) | 4505.96 | -8.11 | -0.18 |
| Nasdaq | (0NDQC) | 15298.92 | +12.28 | +0.08 |
| Russel 2000 | (IWM) | 225.02 | +1.10 | +0.49 |
| MICI 50 | (FFTY) | 50.58 | +0.80 | +1.61 |
Last updated: 1:21 PM ET 9/9/2021 |
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S&P sectors were mixed, with financials and energy faring the best. Healthcare and real estate were the areas that suffered the worst losses.
Small caps were gaining ground, helped by the strength of financial stocks. The Russell 2000 was up about 0.3% around 1:40 p.m. ET.
However, growth stocks were the brightest spot for investors, with the Innovator IBD 50 ETF (FFTY) up 1.6%.
Dow Jones Today: Biden’s drug plan hits health care stocks
The Dow Jones Industrial Average saw its early gains evaporate as it retreated to a loss of 0.2%.
Nike (NKE) was the top performer, gaining almost 2%. It remains stuck below its 50-day moving average.
The worst laggards were Amgen, which fell more than 2%, and Johnson & Johnson, which gave up almost 2%.
They were beaten lower after a new Biden administration plan to cut prescription drug prices was unveiled on Thursday.
He backs legislation from Congressional Democrats, including pushing to empower the federal government to negotiate drug prices in Medicare. It also aims to pass these lower costs on to the private sector.
The Biden plan goes further, as it calls for administrative action to be taken by federal agencies in parallel with the legislative changes referred to.
These include reimbursement for testing for drugs in Medicare, as well as federal funding for research into new treatments, the WSJ reported.
Warren Buffett Stock RH does this
Warren Buffett stock RH was able to recapture a buy point of 724.11 from an old mug with handle.
As it fell more than 8% below its entry, it showed strength as it recovered quickly, making it a buying opportunity.
The RH stock is now well away from its short-term moving averages, as well as its 50-day line. In addition, the line of relative force tries to bend upward.
Warren Buffett is a major funder of HR equity, with his company Berkshire Hathaway (BRKB) currently holds nearly 1.8 million shares.
Institutional ownership is a key asset for HR stock, with 82% of its shares currently held by funds.
Another notable support is the T. Rowe Price New Horizons Fund (PRNHX).
TopBuild Stock joins the ranking
TopBuild’s stock managed to briefly exceed the buy point of a mug with handle of 229.99, and remains well up.
Today’s IBD action on Thursday also broke an early trendline entry of 221, as noted on a daily chart of the rankings. Investors will want to see the relative strength line accelerate in the future.
The Isolation Game was added to the prestigious IBD Leaderboard list of Top Growth Stocks due to its early bullish action.
Meanwhile, track and field action Lululemon soared after crushing earnings and second quarter earnings on Wednesday night. Lululemon’s adjusted earnings per share more than doubled from the period last year to $ 1.65, with sales increasing 61% to $ 1.45 billion, beating both estimates.
LULU stock hit a new high in morning trading and remained up around 12%. Retail inventory is currently being extended from a recent handle entry. However, LULU is making a strong rebound above the rising 10 week moving average near 398. This offers a secondary buy point.
Please follow Michael Larkin on Twitter at @IBD_MLarkin to learn more about growth stocks and analysis.
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