Dow Jones Falls On Boeing, Microsoft Earnings; Tesla Stock Slides On Downgrade

The Dow Jones Industrial Average reversed lower Wednesday, even as Microsoft (MSFT) surged on strong earnings results. Tesla (TSLA) stock dropped on a downgrade from Jefferies. And up next, investors will shift attention to earnings from Facebook-owner Meta Platforms (META), due out after the close.

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Google-parent Alphabet (GOOGL) reported first-quarter earnings and revenue that topped estimates. GOOGL stock lost 1% as digital advertising revenue was flat compared with a year earlier, but topped views.

Microsoft easily beat Wall Street’s targets for its fiscal third quarter thanks to a strong showing by its cloud-computing businesses. The company also guided higher for the current period. MSFT stock surged 7.3% in early trading.

Other key earnings movers include Boeing (BA), Chipotle Mexican Grill (CMG), Illumina (ILMN), Texas Instruments (TXN) and Visa (V).

Boeing ascended 3.8% on strong first-quarter sales. Chipotle shares jumped 8.3%, while Illumina shares dropped 2% in early morning trade. Texas Instruments fell 1.5%, as V stock moved up around 1% after the market open.

Durable goods orders increased 3.2% in March, handily beating estimates that expected an increase of 0.9% in March, and reversing February’s 1% drop. Minus transportation, orders rose 0.3%. That was higher than the expected 0.2% rise, and an improvement from February’s flat reading.

Stock Market Today

Electric-vehicle giant Tesla (TSLA) declined 3% after the Jefferies downgrade Wednesday morning. Dow Jones tech giants Apple (AAPL) and Microsoft were mixed after today’s stock market open.

Crocs (CROX), DraftKings (DKNG), IBD Leaderboard stock Las Vegas Sands (LVS) and IBD SwingTrader stock Lululemon Athletica (LULU) — as well as Dow Jones stocks JPMorgan Chase (JPM), Nike (NKE) and Visa — are among the top stocks to watch in the now-struggling stock market rally.

Nike and DraftKings were featured in this week’s Stocks Near A Buy Zone column.

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Dow Jones Today: Oil Prices, Treasury Yields

After Wednesday’s opening bell, the Dow Jones Industrial Average reversed 0.1% lower, while the S&P 500 gained 0.1%. The tech-heavy Nasdaq composite advanced 1% in morning action, with Microsoft a top performer.

Among U.S. exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) moved up 0.8%, while the SPDR S&P 500 ETF (SPY) traded up 0.2% early Wednesday.

The 10-year U.S. Treasury yield on Wednesday traded unchanged at 3.39%. Over the last two weeks, the 10-year yield rebounded from its lowest level since mid-September, but saw sharp losses Tuesday.

U.S. oil prices threatened to extend Tuesday’s losses, moving lower Wednesday morning. West Texas Intermediate futures traded below $77 a barrel, after pulling back from an April 12 high above $83 a barrel. The Energy Information Administration’s weekly inventories report is due out at 10:30 a.m. ET.

Stock Market Rally Struggles

On Tuesday, the Dow Jones Industrial Average sold off 1%, with Dow (DOW) the biggest loser. DOW stock plunged 5.2% to break down below its key 50-day moving average. The S&P 500 lost 1.6%, while the tech-heavy Nasdaq composite sank 2%.

Tuesday’s Big Picture column cautioned, “If you’ve still got some nice gainers, consider taking partial or full profits. Now is the time to be playing defense, not offense.”

Now is an important time to read IBD’s The Big Picture column with the stock market now struggling to maintain its uptrend.

Five Best Dow Jones Stocks To Buy And Watch Now

Dow Jones Stocks To Buy And Watch: JPMorgan, Nike, Visa

JPMorgan shares lost 2.2% Tuesday, still holding above their 50-day line. Shares now show a cup-with-handle buy point at 141.88, according to IBD MarketSmith pattern recognition. JPM stock lost 0.1% early Wednesday.

Nike shares dropped 1.9% Tuesday, still above their 50-day line and about 3% away from a cup-with-handle’s 127.59 buy point. NKE stock moved down 0.7% in early trade.

Visa shares closed Tuesday just below a 230.15 cup-with-handle buy point after giving up the entry with a 1.4% drop. Visa reported fiscal second-quarter results late Tuesday. And V stock rose around 1% in early morning trade, looking to retake the buy point.

3 Top Growth Stocks To Watch In The Stock Market Rally

Best Stocks To Buy And Watch: Crocs, DraftKings

Crocs shares descended 3.8% Tuesday, snapping a seven-day win streak, but holding above a cup base’s 143.60 buy point, according to IBD MarketSmith. The 5% buy range goes up to 150.78. The company plans to report first-quarter earnings on Thursday. CROX stock inched lower early Wednesday. The company plans to report first-quarter earnings on Thursday.

Backstory: Broomfield, Colo.-based Crocs is best known for its rubbery, casual-wear shoes. The company in recent years expanded its Crocs brand portfolio from the classic slip-on clogs to include boots, sandals, wedges and sneakers. The Crocs brand makes up around 75% of sales.

DraftKings broke out above a cup base’s 21.72 buy point last week, but fell further below the entry during Tuesday’s 1.8% drop. DKNG stock rose 0.2% Wednesday morning.

Backstory: Boston’s DraftKings is an online sports platform that allows users to play daily fantasy games and win cash prizes. Sports-betting prospects look strong, with around 20% of U.S. adults saying they bet money on sports in some way in the last 12 months, according to a 2022 Pew Research Center survey. DraftKings reports Q1 results on May 4.

Las Vegas Sands, Lululemon

IBD Leaderboard stock Las Vegas Sands fell back into the 5% buy range above a 60.40 buy point in a cup with handle following Tuesday’s 2.4% drop. The buy zone tops out at 63.42. LVS stock was up 1% Wednesday morning.

Backstory: Last week, Las Vegas Sands smashed earnings expectations for the first quarter and signaled a “robust recovery” in China’s Macau gaming hub. The casino stock posted earnings of 28 cents per share, up from a net loss of 40 cents a year ago. Revenue vaulted nearly 125% to $2.12 billion.

Lululemon gave up a large part of its gains past a 371.36 entry in a cup with handle, with a 2.2% drop Tuesday. But the stock did hold above its buy point. Shares were flat Wednesday morning.

Backstory: On March 28, Lululemon hiked 2023 guidance after topping earnings and revenue estimates for the holiday fourth quarter, sparking a 12.7% surge on March 29. The yogawear and athleisure apparel retailer’s final fourth-quarter results also exceeded its own preliminary announcement, issued in early January.

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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 three Dow Jones leaders.

Source: IBD Data As Of April 25, 2023

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

Tesla Stock

Tesla stock slid 1.2% Tuesday, still at its lowest level since Jan. 26. In recent weeks, shares triggered the 7%-8% loss rule from a buy point at 200.76 in a cup with handle. And they are trading sharply below their 50-day line, a key level. The stock closed Tuesday 55% off its 52-week high.

TSLA stock threatened to add to Tuesday’s losses, trading down 3% in early Wednesday trade after Jefferies downgraded the electric-vehicle giant from buy to hold, with a lowered price target from 230 to 185.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares dropped 0.9% Tuesday. They remain above a 157.48 buy point and at the top of the buy range that runs up to 165.35. AAPL stock fell 0.3% Wednesday. Apple reports its fiscal second-quarter results on May 4.

Microsoft shares gave up a flat base’s 276.86 buy point amid a four-day losing streak, as they dropped 2.25% Tuesday. With the stock set to regain its entry with big premarket gains, the 5% buy area will go up from the buy point to 290.70. On Wednesday morning, MSFT stock jumped 7.3%.

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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