Dow Jones Rallies On Inflation Data; 7 Top Stocks To Buy And Watch

The Dow Jones Industrial Average rallied Friday morning, as a key inflation reading eased for the first time this year. For the week, the Dow Jones Industrial Average is set to snap an eight-week losing streak, as the stock market rally continues. And following Thursday’s bullish gains, six top stocks to buy and watch include Merck and Tesla supplier Livent.

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Marvell Technology (MRVL), Ulta Beauty (ULTA), Workday (WDAY) and Zscaler (ZS) were key earnings movers Friday.

MRVL shares rallied 6% after beating Wall Street’s estimates. ULTA shares jumped 10% on strong first-quarter results. Workday sold off 7% after missing earnings estimates. Zscaler stock rose 12% on better-than-expected results.

Electric-vehicle giant Tesla (TSLA) traded up 4% Friday morning. Elsewhere, Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) were up around 1% each in today’s stock market.

Amid a stock market rally, Dow Jones leaders Chevron (CVX) and Merck (MRK) — along with Livent (LTHM), Eli Lilly (LLY), Northrop Grumman (NOC), World Wrestling Entertainment (WWE) and ZIM Integrated Shipping (ZIM) — are among IBD’s top stocks to buy and watch for Friday.

WWE is an IBD Leaderboard stock. Northrop is on IBD SwingTrader. And Livent was featured in this week’s Stocks Near A Buy Zone column.

Dow Jones Today: Treasury Yields, Oil Prices, Inflation Data

After Friday’s open, the Dow Jones Industrial Average rose 0.8%, while the S&P 500 moved up 1.5%. The tech-heavy Nasdaq rallied 2% in morning trade.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) climbed 2%. The SPDR S&P 500 ETF (SPY) moved up 1.5%.

The 10-year Treasury yield ticked down to 2.72% Friday morning after closing Thursday at 2.76%. On Tuesday, the 10-year Treasury yield hit its lowest level since mid-April. Meanwhile, U.S. oil prices dropped less than 1%, with West Texas Intermediate crude trading below $114 a barrel.

Early Friday, core personal consumption expenditures — the Federal Reserve’s preferred inflation indicator — rose 4.9% in April, slower than March’s 5.2% increase, which could signal that price increases are slowing.

Stock Market Rally

The major stock indexes posted more positive action Thursday, as the tech-heavy Nasdaq surged 2.7%.

Thursday’s The Big Picture column commented, “The stock market finished sharply higher Thursday in bullish action that left the S&P 500 and Nasdaq composite on track to finally end seven-week losing streaks.”

If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one key to the investment guidelines. IBD offers a broad range of growth stock lists, such as Leaderboard and SwingTrader.

Investors also can create watchlists, find companies nearing a buy point, or develop custom screens at IBD MarketSmith.

Five Dow Jones Stocks To Watch Now

Dow Jones Stocks To Watch: Chevron, Merck

Dow Jones leader and energy giant Chevron is trading just above a flat base‘s 174.86 buy point, according to IBD MarketSmith chart analysis, following Thursday’s 0.7% climb. The 5% buy zone tops out at 183.60. CVX shares traded down a fraction Friday.

CVX stock boasts a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. Investors can use the IBD Composite Rating to easily gauge the quality of a stock’s fundamental and technical metrics.

Merck, a Dow Jones and IBD SwingTrader stock, is back in buy range past a cup-with-handle’s 89.58 buy point, as shares declined 1.5% Thursday. The 5% buy area goes up to 94.06. MRK shares fell 0.5% Friday morning.

The stock’s relative strength line hit a new high this week, a strong indicator of stock market outperformance during the current stock market rally.

Four Top Growth Stocks To Watch In The Current Stock Market Rally

Stocks To Buy And Watch: Livent, Eli Lilly, Northrop, WWE, ZIM

Lithium producer and Tesla supplier Livent broke out past an early buy point at 29.68, advancing 6.8% Thursday. Meanwhile, Livent stock continues to rally up the right side of a cup base that has a conventional entry at 33.14. Keep an eye out for a potential handle to offer a more risk-optimal entry. LTHM shares were up 3% Friday morning.

Pharmaceutical giant Eli Lilly rose 2.1% Thursday, closing in on a flat base’s 314.10 buy point. An early buy trigger at 309.54 was also topped Thursday. Eli Lilly shares were down 0.2% Friday.

IBD SwingTrader stock Northrop Grumman is just shy of a cup with handle’s 477.36 buy point. The defense contractor also is rising above a trend line within its handle. This early entry sits around 464. NOC shares were down 1% Friday morning.

IBD Leaderboard stock World Wrestling Entertainment is one of the top stocks to watch after it closed Thursday in buy range above a flat base’s 63.81 buy point. The 5% buy area goes up to 67.00. WWE shares rose more than 1% Friday.

IPO Leader ZIM Integrated is tracing a cup base that has a 79.05 buy point. Shares are about 10% away from the correct buy point. Keep an eye out for a handle to offer a more risk-optimal entry. ZIM shares were up 1% Friday.

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

Tesla Stock

Tesla stock raced 7.4% higher Thursday, adding to Wednesday’s 4.9% advance. Shares rose 4% Friday morning. The stock remains sharply below its 50- and 200-day moving averages.

Tesla stock traded as high as 1,243.49 on Nov. 4. Shares are about 43% off that record high.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares gained 2.3% Thursday. The stock remains far below its long-term 200-day line. AAPL stock was up 1% Friday.

Software leader Microsoft rose 1.3% Thursday, but remains sharply below its 50- and 200-day lines. The stock closed about 24% off its 52-week high. MSFT shares were up 0.8% Friday.

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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