The Dow Jones Industrial Average made gains even as major components Apple (AAPL) and Microsoft (MSFT) lagged behind. Icon Enterprises (IEP), led by legendary investor Carl Icahn, exploded after taking steps to prop up the company. design kings (DKNG) helped the IBD 50 perform better.
A number of stocks attempted to break out amid the generally positive action. Flowserve (FLS), Oceaneering International (OII) and Expedia.nl (EXPE) were all testing entries.
Government bond yields were mixed as Wednesday’s consumer price index loomed. The 10-year yield fell in nominal terms but remained broadly unchanged at 4.01%, while the two-year yield fell 6 basis points to 4.87%. The yield curve remains inverted.
Nasdaq rally like small caps, IBD 50 Jump
The Nasdaq recovered from the red as the indices closed close to their highs. It yielded a profit of 0.2%. IBD Sector Leaders stock Zscaler (ZS) performed best here, closing with a 7.7% increase.
The benchmark S&P 500 also fought its way out of negative territory, gaining 0.2%. Stock of solar energy Enphase energy (ENPH) did well here with a gain of 5.6%, but continues to fall deeply.
Sectors of the S&P 500 closed mixed. Industry and healthcare performed best. Utilities and communications services were the biggest underperformers in the stock market today.
Small caps impressed, with the Russell 2000 up more than 1%. But it was growth stocks that really gave the bears a nosebleed, with the Innovator IBD 50 ETF (FFTY) up 2.8%.
Dow Jones Today: Microsoft, Apple Stock Lag As Index Wins
The Dow Jones Industrial Average outperformed the major indices, rising nearly 211 points. This translates into a 0.6% gain, breaking a three-day losing streak.
Microsoft shares had a rough session, falling 1.6%. The stock undercut the 21-day exponential moving average and is sliding into the rapidly rising 50-day moving average. Despite the dip, MSFT stock continues to rise a phenomenal 39% so far in 2023. Only Verizon communications (VZN) fared worse in the Dow, falling 2.1%.
Apple shares also struggled on the Dow Jones today, falling more than 1%. It found support at the 21-day exponential moving average, MarketSmith’s analysis shows. IBD research has found that the biggest scholarship winners tend to find support at this important level when making big strides. The AAPL stock is up nearly 51% so far this year.
In the meantime, Intel (INTC) was the top stock on the Dow Jones, up 2.8%. Amgen (AMGN) popped with an almost identical amount.
Carl Icahn stock explodes amid debt moves
Shares of Icahn Enterprises rose 20.2% after the company confirmed that the legendary investor had moved to amend loan agreements and decouple his personal loans from his company’s stock.
The billionaire, who owns about 85% of the company, had previously pledged about 60% of his stock, according to The Wall Street Journal.
The stock was scalped after shortseller Hindenburg claimed in a research note in early May that Icahn Enterprises had “inflated” the value of its assets. It also claimed that money had been brought in from new investors “to pay dividends to old investors”.
They claimed that the Wall Street legend had made “a classic mistake of exerting too much influence in the face of sustained losses.”
IEP shares were boosted after it emerged that Icahn had renegotiated loans with banks, addressing some of the risks highlighted by Hindenburg.
“On July 10, 2023, Carl Icahn and some of its affiliates entered into a three-year loan agreement with certain bank borrowers, which amends and reformulates previous loan agreements with the lenders and consolidates all of Mr. Icahn’s loans,” the company said. said in an SEC filing. “Neither Icahn Enterprises LP (“IEP”) nor any of its subsidiaries is a party to the loan agreement or the previous loan agreements.”
Icahn Industries owns a number of companies in various industries, including Trump Entertainment Resorts and aftermarket auto chain Pep Boys.
Despite the move, IEP stock continues to fall nearly 33% so far in 2023. Nevertheless, it managed to make its way through the 50-day moving average.
DraftKings Stock scores a win
Leaderboard share DraftKings cheered another winner as it continued to ride higher on Monday. Jumping nearly 8.3%, DraftKings stock surpassed its 20% profit target from a trendline buy point of 23.75.
It is now more than 14% above the 10-week moving average, where support created a new entry last week.
DKNG has surged since Oppenheimer raised his price target from 30 to 36 last week and maintained his outperform rating.
The Boston-based sports betting company went public in April 2020. DraftKings has still not turned a profit and analysts expect this to continue through 2026.
DraftKings stock ranks fourth in IBD’s Leisure-Gaming/Equip industry group. It has gained more than 150% so far in 2023 and is an IBD 50 company.
Beyond Dow Jones: Three Stocks Test Listings
With the market now in a confirmed uptrend, it is critical to keep a close eye on any breakouts.
Flowserve is in a buy zone after clearing a cup of 37.56 effective Monday. Volume was below average, a bummer.
The technical pump maker is a strong all-round performer, with its IBD Composite Rating a near-perfect 98.
Oceaneering International is trading just below its buy point after previously clearing a cup base entry of 22.26. The volume here was well above average.
The service provider to the offshore oil and gas industry is among the top 4% of stocks in terms of price performance over the past 12 months.
Expedia also sits just below the entrance after previously winning a cup with a buy point of 114.37.
Big Money has been beating the stocks lately, but 62% of its shares are held by funds, according to data from MarketSmith. Volume was moderate Monday.
Follow Michael Larkin on Twitter at @IBD_MLarkin for more stock market and growth stock analysis.
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