Stock market digs morning hole, potato stock breaks out
Major stock indices recovered from Wednesday morning losses after two days of big gainss, and are trading near the day’s highs. The Dow Jones Industrial Average is approaching positive territory.
The Nasdaq composite fell 0.5% while the S&P 500 lost 0.2%. The Dow Jones is down only 0.1%. The Russell 2000 small cap index suffered the most with a drop of 0.9%.
Stock market and economic news: oil up and mortgages down
Volume on the NYSE and Nasdaq was lower compared to the same time on Tuesday.
The Invesco QQQ Trust, which tracks the Nasdaq 100, fell 0.2%.
European markets fell, with the German DAX stock index down 1.2%, the Paris CAC 40 down 0.9% and the London FTSE 100 down 0.5%, to close the trading session.
OPEC+ agreed to a two million barrel-per-day production cut, the biggest cut since April 2020. Crude oil added 1.3% to $87.72 a barrel on the news. The SPDR Select Energy ETF (XLE) also edged up 2.1%.
The yield on 10-year Treasury bills reached 3.77%. Bitcoin rose 0.2% to $20,325.
The composite MBA Mortgage Demand Index for the week ended Sept. 30 fell 14.2% while the Buy Index fell 12.6%. The refinancing index lost 17.8%, down 86% from a year ago.
The national average for a 30-year fixed-rate mortgage is now above 6.8%, according to bankrate.com.
ADP’s September jobs report came in higher than expected, adding 208,000 more private payrolls versus the consensus 200,000. The number is down considerably from 308,000 in August and 477,000 in July.
The ISM services index for September came in at 56.7 vs. 56.0 expected.
Stock market winner reaches buy point after profits
Manufacturer of potato products Weston Lamb (LW) rose 4.9% on strong volume after hitting Q1 2023 sales estimates and beating earnings expectations. The company noted a 12% decline in sales volume, attributed to slower demand from restaurants, hotels and sports venues.
LW shares broke off a flat bottom and reached the buy point of 83.39 on the MarketSmith chart. LW stock is trading above its 50-day moving average while the relative strength line has just reached a new high, as indicated by the blue dot on the weekly chart.
Murphy’s Oil (MUR) rose 3.5% and broke out of a cup with handle base, reaching the buy point of 41.60. The company announced a quarterly cash dividend of $0.25 to shareholders of record on November 14, payable on December 1. The oil explorer currently pays an annual dividend yield of 2.4%.
RPM International (RPM) rose 3.4% after posting a beating in first-quarter FY2023 EPS and sales. Management gave a higher-than-expected second-quarter sales guidance, adding a boost On title.
Stocks are in a cup-and-handle basis with a buy point of 98.07 while the relative strength line has just reached a new high.
The company specializes in sealants, coatings and construction products. Major consumer brands include Rust-Oleum, Roto-Rooter and Kwik Seal.
Enphase Energy (ENPH) plunged 10% on heavy volume and catches its previous largest one-day decline of 14.1%, in April 2021. The shares are trading below the 50-day line and the moving average exponential of 21 days.
Enphase shares soared on July 27 after a better-than-expected second quarter 2022 earnings report. The stock held gains through the end of September, rolling over after the Fed’s rate hike. Despite everything, the stock has gained 37.3% since the start of the year.
IBD 50: entertainment stock explodes
The Innovator IBD 50 ETF (FFTY) sold 1.1%, falling sharper than major equity indices.
World wrestling entertainment (WWE) gained 0.6% and came off a cut base, hitting a buy point of 75.33. Equities have recently built the right side of the base. The relative strength line reached a new high today.
Matador Resources (MTDR) gained 4.4% and sits in the 5% buy zone of a handle cup base with a buy point of 58.68.
APA Corp. (APA) rose 3.6% after Raymond James lowered its price target to 70, but maintained its strong buy rating. This decision comes on top of yesterday’s 5% spread.
The company recently posted strong growth in quarterly earnings. Analysts now expect annual EPS growth of 137% in 2022 and 15% in 2023.
Mutual funds bought the shares, with 1,270 shares held in June, down from 1,014 in March and 932 in December.
Healthcare staffing company Cross Country Health Care (CCRN) fell 5.4% after Truist Securities downgraded the stock to a hold, with a price target of 36.
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