Dow Jones Falls On SVB Rescue Plan; First Republic, Charles Schwab Crash On Bank Fears

The Dow Jones Industrial Average dropped Monday, as global markets grappled with the ongoing crisis among U.S. banks. The FDIC and other financial regulators guaranteed all deposits of SVB Financial (SIVB). Regulators on Sunday also took control of Signature Bank (SBNY). Meanwhile, San Francisco’s First Republic (FRC) crashed 75% in morning trade, despite receiving additional funding from the Federal Reserve and JPMorgan (JPM). Finally, Charles Schwab (SCHW) plunged 20% amid ongoing banking fears.


On the economic front, eyes will be on the consumer price index on Tuesday. The CPI is expected to rise 0.4%, both overall and excluding food and energy. That would bring the headline CPI inflation rate down to 6% from 6.1% in January, with the core inflation rate easing to 5.5% from 5.6%.

Earnings continue trickling out at the tail end of the season this week. Among them are Academy Sports & Outdoors (ASO), Adobe (ADBE), Dollar General (DG), FedEx (FDX), Five Below (FIVE), GitLab (GTLB) and Lennar (LEN).

Stock Market Today

Drug giant Pfizer (PFE) agreed to pay $43 billion for biotech Seagen (SGEN). Pfizer shares rose 0.3%, while SGEN stock soared 15%.

Genetic screening tools leader Illumina (ILMN) jumped more than 11% early, on news reports that activist investor Carl Icahn planned to nominate three persons to the company’s board of directors.

Electric-vehicle leader Tesla (TSLA) traded down more than 2% Monday morning after Wolfe Research downgraded the stock to peer perform from outperform. Dow Jones tech giants Apple (AAPL) and Microsoft (MSFT) were up after the stock market open.

IBD Leaderboard watchlist stock Palo Alto Networks (PANW) and New Relic (NEWR) — as well as Dow Jones stock Salesforce (CRM) — are among the top stocks to watch in the new stock market correction.

Palo Alto is an IBD Leaderboard watchlist stock. New Relic was recently an IBD Stock Of The Day. And Salesforce was featured in last week’s Stocks Near A Buy Zone column.

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Dow Jones Today: Oil Prices, Treasury Yields

After Monday’s market open, the Dow Jones Industrial Average fell 0.2%, and the S&P 500 was down 0.4%. The tech-heavy Nasdaq composite erased sharp losses in morning action, with Seagen and Illumina leading the index.

Among U.S. exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.1% and the SPDR S&P 500 ETF (SPY) dropped 0.2% early Monday.

The 10-year U.S. Treasury yield tumbled to 3.69% Friday. Then on Monday, the 10-year yield dived to 3.47% in early morning trade, as safe haven trade drove bonds sharply higher following the SVB collapse. The dollar angled lower, losing ground against the euro and the yen.

Oil prices sold off Monday morning after Friday’s brief bounce. West Texas Intermediate futures slid nearly 5% in early trade, trading below $73 a barrel early Monday. Gold and silver also moved sharply higher as investors sought solid ground. Gold jumped 1.4% to above $1,892 an ounce. Silver rallied 3.3%, clearing $21 an ounce.

Stock Market Correction

On Friday, the stock market sold off sharply, as the major stock index ended with big losses. The Dow Jones Industrial Average dropped 1.1%, and the S&P 500 declined 1.45%. The tech-heavy Nasdaq tumbled 1.8%.

Friday’s Big Picture column commented, “IBD changed its market outlook to ‘uptrend under pressure’ Thursday. And after Friday’s selloff we’ve cut our outlook further, to ‘market in correction.’ This requires investors to avoid any stock purchases and pivot to defensive trading, such as taking profits and cutting losses short.”

Now is an important time to read IBD’s The Big Picture column amid the new stock market correction.

Five Dow Jones Stocks To Buy And Watch Now

Dow Jones Stocks To Watch: Salesforce

In recent weeks, Dow Jones leader Salesforce showed big upside strength after strong fourth-quarter results. But those gains have mostly disappeared amid the recent market weakness, and now the stock is back below a 178.94 cup-with-handle entry. Still, the stock’s recent strength is a reason to monitor the software leader in the coming sessions. CRM stock rose 0.5% Monday.

4 Top Growth Stocks To Buy And Watch In The Stock Market Correction

Top Stocks To Watch: Palo Alto, New Relic

IBD Leaderboard watchlist stock Palo Alto Networks continues to trade quietly in a handle after the stock’s 12.5% surge on Feb. 22. Shares remain within striking distance of a base’s 192.94 buy point. Bullishly, the stock’s relative strength line is at new highs, as the stock sharply outperforms the market averages. PANW stock traded down 0.8% Monday morning.

Backstory: On Feb. 21, the cybersecurity giant announced good results for the January-ended quarter that saw earnings hit $1.05 a share, up 81% vs. a year earlier, on a 26% jump in revenue to $1.7 billion.

Recent IBD Stock Of The Day, New Relic, is working on a flat base with a 80.98 buy point in the aftermath of the Feb. 8 earnings-fueled surge. The RS line is holding up for now. NEWR stock was down 1.6% Monday.

Backstory: New Relic provides a cloud-based suite of software products that enables organizations to collect, store and analyze massive amounts of data in real time. Customers gain increased visibility into their enterprise software to help make data-driven decisions.

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Stocks To Watch In Stock Market Correction

These are five top stocks to watch in today’s stock market, including two Dow Jones leaders.

Company NameSymbolCorrect Buy PointType Of Buy Point
New Relic (NEWR)80.98Flat base
American Express (AXP)182.25Cup with handle
Palo Alto Networks (PANW)192.94Cup with handle
Salesforce (CRM)178.94Cup with handle
Source: IBD Data As Of March 9, 2023

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Tesla Stock

Tesla stock snapped a four-day losing streak Friday, with modest gains. It’s trying to find support around its key 50-day line and closed Friday around 55% off their 52-week high.

Tesla shares fell 2% Monday morning, threatening to erase Friday’s gains.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares declined 1.4% Friday, finishing with a weekly loss of 1.7%. The stock rose 1.6% early Monday.

Microsoft shares extended a losing streak to four sessions, with a 1.5% fall Friday. The stock is more than 20% off its 52-week high after recent declines. MSFT stock moved up 0.8% Monday morning.

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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