The Dow Jones gained as Federal Reserve chairman Jerome Powell made an inflation pledge. Tesla (TSLA) stock carved out a new entry, while Rivian Automotive (RIVN) advanced on a new analyst rating. General Electric (GE) also jumped on new coverage. Apple (AAPL) and Boeing (BA) were among the top blue chips, while Illumina (ILMN) exploded.
Fed Chair Powell Makes Inflation Pledge
Fed Chairman Powell gave the stock market a boost after he struck a hawkish, yet measured, tone during his Senate confirmation hearing Tuesday.
He insisted that there will be a return to normal supply conditions in 2021 but underlined the point he will not be afraid to use his toolbox to tackle rising prices amid a mismatch between supply and demand.
“If we see inflation persisting at high levels longer than expected (and) we have to raise interest rates more over time, we will,” he said.
The central bank lowers rates to boost demand and spur growth. It also raises them to cool the economy and curb demand.
Yields fell following Powell’s testimony. The benchmark 10-year U.S. Treasury dipped about 3 basis points to 1.75%.
Nasdaq Rallies, Growth Stocks Jump
The Nasdaq had a solid session, closing up 1.4%. Illumina was the top stock here, rising 17%. It was boosted after issuing 2022 revenue guidance that topped analyst views.
U.S. Stock Market Today Overview
Last Update: 4:06 PM ET 1/11/2022
The S&P 500 also moved higher, ending the day up 0.9%. Las Vegas Sands (LVS) was among the standouts here, gaining 6.6%.
The S&P 500 sectors were mostly positive. Technology and energy were the leaders, while consumer staples and utilities lagged most.
Small caps were also boosted amid the encouraging action. The Russell 2000 closed up 1%.
Growth stocks also gave the bears a bloody nose, with the Innovator IBD 50 ETF (FFTY), a bellwether for growth stocks, up 1.3%.
Dow Jones Up As Boeing, Apple Stock Gain
The Dow Jones Industrial Average also squeezed out a gain. It closed up 0.5% as it rose 183 points.
Apple stock was among the best performers. It rose almost 2% and remains extended from a cup-with-handle buy point of 153.27.
But it was Boeing that led the upside on the Dow Jones today. The aerospace giant closed up 3.2%. It remains stuck below its 200-day line for now, though.
IBM (IBM) was the worst index laggard, falling nearly 2%.
IBM stock was punished after UBS downgraded it from neutral to sell. Procter & Gamble (PG) closed down just over 1%.
Tesla Stock Offers New Entry; RIVN Pops
EV leader Tesla closed up 0.6% and is now offering up a new buy point. The entry at 1,208.10 is due to a new handle, which is deeper than usual due to recent volatile market conditions.
It comes after a breakout past a double-bottom base buy point of 1,202.05 failed.
Tesla stock has given up all of its gains, and more, after clearing a trendline entry last week. But if the positive market action continues, it could soon retake this level.
Shares traded as high as 1,243.49 on Nov. 4. The stock now sits almost 15% below this level. It remains up more than 30% over the past 12 months, however.
TSLA stock is a member of the prestigious IBD Leaderboard list of top growth stocks.
Meanwhile, Rivian stock closed up 2.6%. The EV stock was boosted after Redburn initiated coverage with a buy rating.
Despite today’s progress, it remains down more than 3% for the week. It is also more than 50% off its all-time high of 179.47.
GE Stock Jumps On This, Eyes Key Level
General Electric stock popped higher after investment bank Bernstein initiated coverage. It closed the session up 2.4%.
GE stock is currently in the midst of a consolidation. It remains well shy of its ideal buy point of 116.27, MarketSmith analysis shows.
Both earnings and stock market performance are far from ideal. But there are positive technical signs.
It is now back above its 50-day moving average. It is also closing in on its 200-day moving average, while the relative strength line is also picking up slightly.
Bernstein highlighted the possible benefits of its being turned into three separate businesses. The firm said its component parts are “easily scalable public companies.” It also said that “improved line of sight to financials and end markets” will benefit shareholders.
These Stocks Pass Buy Points
Apache parent APA closed out of its buy range after sprinting past a cup-without-handle entry of 28.73. This is a second stage pattern, which IBD research finds are more likely to succeed.
The relative strength line sprang to a new high, which is another positive.
Energy stocks in general have been doing well as economies look to get on track following the coronavirus pandemic.
Steel play ArcelorMittal closed in its buy zone after moving above an ideal entry of 34.98.
One issue is company earnings, which are not ideal. But big money has been buying shares of late and it is in the top 10% of stocks in terms of market performance over the past 12 months.
With the market uptrend still currently under pressure it is not advisable to buy new stocks at the current time.
It is worth keeping a close tab on stocks performing well under these conditions and add them to one’s watchlist, however.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.
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