Dow Jones Rallies; Tesla Falls After Elon Musk Reveals Fears; Warren Buffett Stock Gains

The Dow Jones Industrial Average rallied as yields fell. Tesla (TSLA) skidded after CEO Elon Musk voiced a warning. A Warren Buffett stock fell despite the news his firm Berkshire Hathway (BRKB) had bought more shares. Moderna (MRNA) rose after a Centers for Disease Control boost.

A couple of health stocks are looking strong despite the market being in the grip of a correction. Johnson & Johnson (JNJ) and Centene (CNC) are both eyeing entries.

X

Volume was up amid a positive reversal for the market. It rose on both the Nasdaq and the New York Stock Exchange, according to preliminary data.

Meanwhile, the yield on the benchmark 10-year Treasury note slid six basis points to 3.1% amid rising recession fears. Fed Chairman Jerome Powell also maintained his hawkish stance on fighting inflation during a second day briefing Congress Thursday.

West Texas Intermediate crude oil fell 2% to trade at about $104 per barrel.

Nasdaq Leads As Small Caps Gain

The Nasdaq was the best performer, ending the day up 1.6%. Datadog (DDOG) stood out with a 10.4% gain.

The S&P 500 also showed strength as it rose 1%. Autodesk (ADSK) sparkled as it surged 8.4%.

The S&P 500 sectors were mixed. Utilities and health care were the best-performing areas. Energy and materials were the laggards.

Small caps also sparkled, with the Russell 2000 posting a gain of 1.1%.

Growth stocks were mauled by the bears however, with the Innovator IBD 50 ETF (FFTY) closing the day down 2.2%.

Dow Jones Today: Software Stock Leads Upside

The Dow Jones Industrial Average rallied into the close. It closed up 195 points, or 0.6%.

Salesforce (CRM) was the top stock on the Dow Jones today as it gained more than 3%.

Industrial machinery stock Caterpillar (CAT) and energy play Chevron (CVX) were the worst performers.

Tesla Stock Falls After Elon Musk Warning

Tesla stock skidded lower after negative comments from CEO Elon Musk emerged.

The eccentric executive voiced fears about the firm’s financial health during a Tesla owners group interview

“The past two years have been an absolute nightmare of supply chain interruptions, one thing after another,” Musk said. “We’re not out of it yet. That’s overwhelmingly our concern is how do we keep the factories operating so we can pay people and not go bankrupt.”

He also described the firm’s new factories in Berlin, Germany and Austin, Texas as “gigantic money furnaces.”

It comes after Musk previously revealed the firm was looking to cut about 10% of its salaried staff even as it hires more hourly production workers.

Tesla stock closed the day off lows but still fell 0.4%. The former Leaderboard stock remains rooted well below its 50-day moving average.

Warren Buffett Stock Gains As BRKB Adds Shares

Warren Buffett stock Occidental Petroleum (OXY) rallied on the news Berkshire Hathaway had increased its stake in the oil company.

Pressure on energy stocks overall forced Occidental lower for a period, but it ended the day up 0.6%.

OXY stock is now up more than 80% so far in 2022. Nevertheless, it remains stuck below its 50-day moving average after falling from highs.

Buffett’s firm Berkshire Hathaway added a further 9.6 million shares. It now owns almost 153 million, which accounts for more than 16% of the company.

Among other oil stocks, Callon Petroleum (CPE) fell almost 4% while Diamondback Energy (FANG) fell more than 5%. Apache parent APA (APA) dipped about 3%.

The Vanguard Energy Index Fund ETF (VDE) fell almost 4%, but remains up more than 22% since the start of the year.

Moderna Stock Gets Vaccine Boost

Moderna stock got a boost Thursday after advisors to the Centers for Disease Control and Prevention endorsed the firm’s Covid vaccine for children ages six to 17.

They panel of independent experts had examined the vaccine’s safety and effectiveness at a public meeting.

They found there is an elevated risk of heart inflammation following vaccination for boys ages 12 to 17.

But they also decided the coronavirus itself carries a higher risk.

It is now expected that CDC Director Dr. Rochelle Walensky will sign off on the recommendation later Thursday.

Moderna stock ended the day up 5.3%.

Children in the age group can already take vaccines made by Pfizer (PFE) and its partner BioNTech (BNTX). PFE rose 2.1% while BNTX spiked 7%.

Nasdaq Leads Rally As Recession Fears Rock This Sector

Outside Dow Jones: Health Stocks Eye Entries

It is always a good idea to beef up one’s watchlist when the market is in a correction. These names are solid options.

Dow Jones stock Johnson & Johnson has seen a flat base evolve into a double-bottom. The ideal buy point here is 181.84, according to MarketSmith analysis.

The stock managed to retake the 50-day moving average, which is a bullish sign. It offers a yield of 2.5%, which beats the S&P 500 average of 1.7%.

JNJ is in the top 8% of stocks in terms of price performance over the past 12 months. Earnings are seen rising 5% in 2022 and by 6% in 2023.

Centene is another health stock that is showing signs of life. It also has a double-bottom pattern, with an 87.44 entry. The relative strength line has just hit a new high, and it remains on a strong long-term uptrend.

Profits are seen ramping up, with 9% growth seen this year and growth of 13% expected in 2023. Big Money is a key backer of the stock, with 66% of shares currently held by funds.

Centene provides health plans and related health care management services.

Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.

YOU MIGHT ALSO LIKE:

MarketSmith: Research, Charts, Data And Coaching All In One Place

These Are The 5 Best Stocks To Buy And Watch Now

This Is The Ultimate Warren Buffett Stock, But Should You Buy It?

Software Growth Stocks To Buy, Watch Or Sell

This Is The Ultimate Donald Trump Stock: Is DWAC A Buy?