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Dow Jones futures turned lower Thursday, threatening to add to Wednesday’s losses as markets digested weekly unemployment data. Tesla stock raced higher, aiming to add a fourth straight advance, on news that May sales in China rebounded, while UBS upgraded the stock to buy.
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Key earnings reports include Five Below (FIVE) and Nio (NIO). FIVE shares slid 8% on weak first-quarter sales. Nio shares skidded more than 5%.
Electric-vehicle giant Tesla (TSLA) traded more than 2% higher Thursday. Elsewhere, Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) were mixed ahead of today’s stock market open.
Amid the ongoing stock market rally, Dow Jones leaders Chevron (CVX), Merck (MRK) and Travelers (TRV) — along with Vertex Pharmaceuticals (VRTX), Albemarle (ALB), Eli Lilly (LLY), Northrop Grumman (NOC) and Ulta Beauty (ULTA) — are among IBD’s top stocks to watch for Thursday.
Albemarle is an IBD Leaderboard stock. Vertex was featured in this week’s Stocks Near A Buy Zone column.
Dow Jones Today: Treasury Yields, Oil Prices, Jobless Claims
Ahead of Thursday’s open, Dow Jones futures turned 0.3% lower vs. fair value, while S&P 500 futures dropped 0.5%. Nasdaq 100 futures fell 0.6%. Remember that trading in Dow Jones futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.6%. The SPDR S&P 500 ETF (SPY) fell 0.4% in early trade.
The 10-year Treasury yield ticked higher to 3.07% Thursday morning after Wednesday’s jump. Meanwhile, U.S. oil prices were modestly lower, with West Texas Intermediate holding just below $122 a barrel.
First-time unemployment claims rose to 229,000, higher than the expected rise to 210,000 vs. 200,000 in the prior week. Initial jobless claims hit their highest level since January.
Stock Market Rally
The stock market posted disappointing action Wednesday, as the major stock indexes finished with solid losses.
Wednesday’s The Big Picture column commented, “Smaller companies led Wednesday’s decline. That’s typically the reaction to growing fear of a recession — or what’s plaguing stocks today, the threat of long-term stagflation.”
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, Travelers
Dow Jones leader and energy giant Chevron is making progress above a flat base’s 174.86 buy point, according to IBD MarketSmith chart analysis, following Wednesday’s 0.5% gain. The 5% buy zone tops out at 183.60. CVX shares were unchanged Thursday, even after Credit Suisse upped its price target from 190 to 202.
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 Big Cap 20 stock, gave up its cup-with-handle’s 89.58 buy point Wednesday, as shares dropped 1.1%. The 5% buy area goes up to 94.06. MRK shares inched higher Thursday morning.
The stock’s relative strength line hit a new high in mid-May, but is now pulling back sharply.
Insurance giant Travelers is building a flat base with a 188.08 buy point. Shares are back below their 50-day line after Wednesday’s 0.9% rise. Travelers stock traded 0.5% higher early Thursday.
Five Top Growth Stocks To Watch In The Current Stock Market Rally
Stocks To Buy And Watch: Albemarle, Eli Lilly, Northrop, Ulta, Vertex
IBD Leaderboard stock Albemarle is about 7% away from a cup-with-handle’s buy point at 273.78, according to IBD MarketSmith chart analysis. In recent weeks, Albemarle passed an early buy point near 248. ALB shares were unchanged Thursday morning.
Pharmaceutical giant Eli Lilly rose 0.45% Wednesday and is nearly back above a flat base’s 314.10 buy point following a May 27 breakout. LLY shares traded flat Thursday.
Northrop Grumman surrendered its cup-with-handle’s 477.36 buy point after tumbling 4% Wednesday. NOC shares were unchanged Thursday morning.
Ulta Beauty finished Wednesday within striking distance of a cup with handle’s 426.93 buy point after briefly topping the entry. ULTA shares traded unchanged Thursday.
Vertex Pharmaceuticals is tracing a cup with handle with a 276.10 buy point. For now, shares are trying to break out past the entry, but are having trouble closing above the buy point. Vertex shares were quiet Thursday morning.
Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live
Tesla Stock
Tesla stock rose 1.25% Wednesday, extending a win streak to three sessions. Shares looked to continue this week’s gains, moving up around 2% Thursday morning after the China Passenger Car Association said Tesla sold 32,165 made-in China vehicles last month. That was below normal, but back on track after just 1,512 in April when the Shanghai plant was shutdown due to Covid lockdowns.
Meanwhile, UBS upgraded the stock from neutral to buy with a 1,100 price target.
The stock is still 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 dropped 0.5% Wednesday. The stock remains far below its long-term 200-day line. AAPL stock traded up 0.3% Thursday.
Software leader Microsoft lost 0.8% Wednesday, and remains sharply below its 50- and 200-day lines. The stock closed more than 20% off its 52-week high. MSFT shares dipped a fraction Thursday.
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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