Dow Jones Fights Back as Fed Minutes Show; Microsoft Sinks, Tesla Earns; GE Stock Pops

The Dow Jones Industrial Average resisted after slipping in the latest Fed Minutes release. Microsoft ( MSFT ) fell after the decline. General Electric (GE) spinoff then dropped GE Healthcare Technologies (GEHC). Tesla (TSLA) won.


Meanwhile, several stocks attempted to bounce back amid some positive action. Retailer Buckle (BKE) and home builder DR Horton (DHI) tested both purchase points.

The yield on the benchmark 10-year Treasury note fell 11 basis points to 3.68%. West Texas Intermediate crude fell nearly 5% to just over $73 a barrel.

Indices Reverse After Fed Minutes

Early gains were pared by the release of the Fed’s latest meeting minutes. The document provides additional information on the views of the Federal Open Market Committee, chaired by Federal Reserve Chairman Jerome Powell.

Those looking for signs of a turnaround were disappointed as central bankers continued to strike a hawkish tone.

“Participants generally observed that the accommodative policy stance should be maintained until incoming data provide confidence that inflation is on a sustained downward path to 2 percent, which is likely to take some time.”

He also noted that several meeting participants believed that historical experience cautioned against easing policy too quickly amid “unacceptably high levels of inflation.”

In other economic data, the number of jobs in November reached 10.5 million, exceeding expectations of 10-10.33 million. Openings have decreased since August.

Nasdaq gains, small caps dominate

The Nasdaq was able to close with an increase of 0.7%. (JD) was the standout performer with a gain of 14.7%. The stock crossed the 61.50 buy point.

The S&P 500 managed to gain 0.8%. carnival (CCL) impressed here with a gain of 9.7%.

All S&P 500 sectors were positive. Real estate and materials were the strongest sectors, while health and energy lagged behind.

Small caps outperformed the major indexes, with the Russell 2000 ending up 1.3%.

Growth stocks also rose, with the Innovator IBD 50 ETF ( FFTY ) up 0.5%.

Today, Dow Jones: Microsoft lowered its stock level

The Dow Jones Industrial Average saw gains evaporate following the release of the Fed Minutes. Although it gained 0.4%, it managed to fight its way out of negative territory.

Microsoft was hit after analysts downgraded it. It closed lower, but still missed the key 50-day moving average, down 4.4%, according to MarketSmith.

UBS analyst Karl Keirstead downgraded MSFT from buy to neutral and cut his price target to $250, citing challenges with Office 365 and Azure cloud computing.

apple ( AAPL ), which was crushed on Tuesday, ended the day up 1%.

Aerospace giant Boeing (BA) led the Dow higher with a 4.2% gain. It had a slightly higher nose Salesforce ( CRM ) rose 3.6%. Walt Disney (DIS) rose 3.4%.

GE Stock Pops After Spinoff

General Electric gained strength on Wednesday after completing the spin-off of its health care division.

GE shares rose 5.7% to their best level since April. This comes after shares rebounded from their 50-day moving average on Tuesday.

GE shares cleared a flat-base, spinoff-adjusted 67.15 buy point.

Newly minted GE HealthCare also saw its stock rise. In fact, it got even better, increasing by 8%.

GE HealthCare’s installed base includes more than 4 million machines for imaging, ultrasound and pharmaceutical diagnostics. It serves more than 1 billion patients a year and enables more than 2 billion medical procedures.

Dow Jones is rising, but beware of ‘blip buying’

Hemorrhaging Tesla stock

Tesla shares had a rough time, but bounced back on Wednesday. TSLA ended up 5.1% near the day’s high.

Nevertheless, it’s a long way back for the EV giant. The stock fell more than 12% on Tuesday to a 52-week low of 104.64.

That sent Tesla shares to their lowest close since August 13, 2020, about 73% below their 52-week high.

That came after fourth-quarter shipments hit a record 405,278. Despite aggressive year-end promotions, Q4 missed forecasts.

Beyond the Dow Jones: Try These Stocks Buy Points

There is currently a stock market correction, now is not the time to buy stocks. Nevertheless, it is important to note the breakdowns of strong performers.

Apparel retailer Buckle is sitting in a buy zone after crossing the 46.77 buy point early. The relative strength line made fresh highs, positive but volume was weak.

All-around strong performance is reflected in the IBD Composite Rating of 95 out of 99.

Meanwhile, homebuilder DR Horton held back from entry after the 92.55 handle crossed a buy point earlier. The sound was weak here.

Follow Michael Larkin on Twitter @IBD_MLarkin for further analysis of growth stocks.


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