Dow Jones Dives On Cool Inflation Data, Surging Jobless Claims; PacWest Plunges 30%

The Dow Jones Industrial Average dropped more than 350 points Thursday after key inflation data, led by the Labor Department’s producer price index, and weekly initial jobless claims. Meanwhile, Walt Disney (DIS) dived on weak subscriber growth, while embattled regional bank PacWest (PACW) plunged after the company said deposits fell nearly 10% in the week ended May 5.

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The April producer price index rose 0.2% on the month, with an annual increase of 2.3%, both cooler than estimates. Core prices rose 0.2% month over month and climbed 3.2% year over year. Those also were lower than expected.

Further, first-time unemployment claims jumped to 264,000, their highest level since October 2021. They were expected to rise to 245,000 vs. 242,000 in the previous week.

Early Thursday, Disney and Trade Desk (TTD) were on the move after earnings.

Disney shares tumbled more than 6% after the company’s streaming services units missed subscriber growth estimates in its late Wednesday earnings report.

Trade Desk on Wednesday reported March-quarter earnings and revenue that topped estimates as internet TV drove growth. TTD stock climbed nearly 5% early Thursday as the company’s own outlook edged above views.

Advanced Micro Devices (AMD), IBD Leaderboard stock Nvidia (NVDA), IBD SwingTrader idea Netflix (NFLX) and Uber Technologies (UBER) — as well as Dow Jones stocks Nike (NKE) and Visa (V) — are among the best stocks to buy and watch in the stock market uptrend.

Visa was featured in this week’s Stocks Near A Buy Zone column. Netflix and Nvidia were recent IBD Stock Of The Day topics.

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Dow Jones Today: Oil Prices, Treasury Yields

After Thursday’s opening bell, the Dow Jones Industrial Average fell 1.1%, with Disney shares providing the bulk of the early drag. The S&P 500 faded 0.5%, while the tech-heavy Nasdaq composite lost 0.2% in morning action, with Alphabet (GOOGL) running high on the list, leaning to extend its 5.9% gain for the week through Wednesday.

Among U.S. exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) rose less than 0.1%, while the SPDR S&P 500 ETF (SPY) traded down 0.3% early Thursday.

The 10-year U.S. Treasury yield on Thursday traded down to 3.36% after the cool PPI inflation report.

U.S. oil prices continued to ease Thursday morning after rebounding from multi-month lows. West Texas Intermediate futures held right around $72 a barrel, down about 6% so far in May.

Stock Market Rally

On Wednesday, the Dow Jones Industrial Average fell 0.1%. The S&P 500 rose 0.45%, while the tech-heavy Nasdaq composite rallied more than 1%.

Wednesday’s Big Picture column commented, “Watch out because the light at the end of the tunnel could be an oncoming train as complacent investors head into a potential collision with the June 1 debt ceiling deadline.”

Now is an important time to read IBD’s The Big Picture column after Wednesday’s stock market gains.

Five Best Dow Jones Stocks To Buy And Watch Now

Dow Jones Stocks To Buy And Watch: Nike, Visa

Nike shares declined 1.3% Wednesday, further below a cup-with-handle’s 127.59 buy point after last week’s breakout attempt. A new handle entry has also appeared, at 128.78. Shares are looking for support around their 50-day line. NKE stock fell 0.4% early Thursday.

Visa shares remain in buy range above a 230.15 cup-with-handle buy point, even after dropping 0.8% Wednesday. The buy range goes up to 241.66. V stock was up 0.1% Thursday.

4 Top Growth Stocks To Watch In The Stock Market Rally

Best Stocks To Buy And Watch: AMD, Nvidia, Netflix, Uber

Chip leader Advanced Micro Devices continues to rally up the right side of a cup base that has a 102.53 buy point, according to IBD MarketSmith pattern recognition. Monday’s surge saw AMD stock climb above an early trendline entry, using May 4’s high of 91.64 mark as the buy point. AMD shares rose 1.9% Thursday.

IBD Leaderboard stock Nvidia finished Wednesday up 1.1%, still in buy range above a 280.10 buy point in a short consolidation. The 5% buy zone goes up to 294.11. NVDA stock was up 0.1% early Thursday.

Recent IBD Stock Of The Day, Netflix, popped above its 50-day moving average line Monday. That positive action created a buying opportunity for aggressive investors. Further, Netflix shares now are nearing a buy point of 349.90 out of a cup-with-handle base. NFLX stock lost 0.1% Thursday morning.

Uber Technologies decisively moved above a 37.68 buy point in a cup base, rallying 1.6% Wednesday. UBER shares are still in the 5% buy area that goes up to 39.56. The stock was down 0.6% Thursday.

Learn How To Time The Market With IBD’s ETF Market Strategy

Best Stocks To Buy And Watch In Stock Market Rally

These are four best stocks to buy and watch in today’s stock market, including two Dow Jones leaders.

Source: IBD Data As Of May 11, 2023

Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live

Tesla Stock

Tesla stock dipped 0.4% Wednesday, falling for a second day. Despite gains since late April, shares remain below their 50-day line, as they look to build a new base. The stock closed Wednesday 46% off its 52-week high.

TSLA stock looked to rebound from Wednesday’s losses, but traded a fraction lower early Thursday.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares rallied 1% Wednesday, bouncing back from two days of losses. They closed just off their 52-week highs, which were set back in mid-August. The stock continues to add to gains above a 157.48 buy point and it is out of the buy range that ran up to 165.35. AAPL stock was down slightly Thursday.

Microsoft shares climbed 1.7% Wednesday, hitting a new 52-week high. Shares remain sharply above a 276.86 flat-base buy point. On Thursday morning, MSFT stock fell 1.4%.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.

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