The Dow Jones Industrial Average trimmed some of its earlier losses but still traded moderately lower in today’s stock market after the major indexes all hit record highs last week. All the major indexes traded lower on Monday with the Nasdaq leading on the downside.
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Shares of Twitter (TWTR) fell 6.5%, below the 50-day line, as investors responded to the social media platform’s suspension of President Trump’s Twitter account on Friday. Meanwhile, shares of Tesla (TSLA) and Facebook (FB) 7% and 4%, respectively, and were among worst performers in the Nasdaq 100.
Stocks kicked off a strong rally the first week of 2021 after a powerful fourth-quarter advance. But investors should be aware.
As noted on the IBD Live show in recent days, the Nasdaq has signaled mild overheating, suggesting it might be on the verge of consolidating some of the recent gains.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 31016.48 | -81.49 | -0.26 |
| S&P 500 | (0S&P5) | 3798.74 | -25.94 | -0.68 |
| Nasdaq | (0NDQC ) | 13028.02 | -173.96 | -1.32 |
| Russell 2000 | (IWM) | 207.20 | -0.52 | -0.25 |
| IBD 50 | (FFTY) | 43.33 | +0.40 | +0.93 |
Last Update: 3:30 PM ET 1/11/2021 |
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Technology stocks led Monday’s downside as the Nasdaq fell more than 1.2% during the final hour of trading after hitting a new high of 13,208 last week. The Dow Jones fell 0.3%; the S&P 500 declined 0.7%. The Russell 2000 small-cap index was down around 0.3%. Volume was trading lower on the Nasdaq and on the NYSE vs. the same time on Friday.
However, the Innovator IBD 50 ETF (FFTY) showed a strong gain of 1.2%, strongly outperforming the major indexes. The growth-focused index was boosted by leaders like Crocs (CROX) and MarineMax (HZO), which gained over 9% each.
Among the Dow Jones leaders, Walgreens (WBA) and Merck (MRK) led the upside with gains of more than 2%. Walgreens rose above a 5% buy zone after breaking out into this area on Thursday. Shares rose 4.5% Monday and were extended past a 44.97 consolidation buy point.
Beyond Dow Jones: Stocks To Watch
Several key stocks remain inside or near buy zones, including chip stock Advanced Micro Devices (AMD).
The stock is bouncing off its 21-day exponential moving average and has regained an alternate entry of 96.47 after rising 3.6% Monday. The buy zone tops out at 101.29. The stock maintains a strong Composite Rating of 98 and an EPS Rating of 99 as well.
According to Leaderboard analysis, “The new base is late stage, which carries higher risk. The relative strength line is acting well enough.”
Among other chip stocks outperforming, Nvidia (NVDA) also gained a solid 3.7%. The stock is now 6% away from a new 587.76 flat base buy point. On Monday, the stock regained its 50-day line, a bullish sign. According to IBD Stock Checkup, the stock maintains a Composite of 98 and a 80 RS Rating.
Finally, shares of Tractor Supply (TSCO) broke out from a 12-week cup with handle and a 150.79 buy point after a strong bounce off the 50-day line last week.
Shares remain just below the 5% buy zone, according to IBD MarketSmith chart analysis.
Tractor Supply maintains a strong 96 Composite and a 96 EPS Rating. However, the stock shows signs of weakness in recent price performance with a low 63 Relative Strength Rating, as noted in IBD Stock Checkup.
Follow Rachel Fox on Twitter at @foxon stocks for more market insight and Dow Jones commentary.
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