Dow Jones Climbs As Pelosi Pressures Mnuchin On Stimulus; This Stock Hits Buy Zone Amid Deal – Investor's Business Daily

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The Dow Jones Industrial Average surged higher amid a broad rally as House Speaker Nancy Pelosi pressed Treasury Secretary Steven Mnuchin on coronavirus stimulus. Apple (AAPL) was a leading blue chip gainer ahead of earnings, while chip stock Inphi (IPHI) surged amid a possible takeover by Marvell Technology (MRVL).

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Pelosi is demanding a response from Mnuchin on several disputed areas that are holding back the passage of a coronavirus aid package. These include testing, relief for local and state governments, and unemployment insurance.

The Democrat leader is looking to restart talks so a potential agreement can be reached after the election. The move comes as Covid-19 infections spike around the U.S. and around the world.

Stocks have also been rallying as fresh data showed a drop in the number of jobless claims and a record expansion of the economy in the third quarter amid a relaxation of coronavirus lockdown restrictions.

S&P 500, Nasdaq Rally

The S&P 500 closed up 1.2% as it partook in the broad rally, though it surrendered some of its gains late in the day. Meanwhile, the tech-heavy Nasdaq was up 1.6%, making it the best performing index of the day. However, it had been up as much as 2.5%. This move saw the index come within a hair of its 50-day moving average. Regaining the key technical benchmark will be an important short-term goal.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 26659.04 +139.09 +0.52
S&P 500 (0S&P5) 3310.14 +39.11 +1.20
Nasdaq (0NDQC ) 11185.59 +180.72 +1.64
Russell 2000 (IWM) 155.11 +1.80 +1.17
IBD 50 (FFTY) 36.93 +0.45 +1.23
Last Update: 4:04 PM ET 10/29/2020

Volume was down on both the NYSE and the Nasdaq. It slipped around 5% on the NYSE vs. Wednesday, according to early data. Trading was down by 21% on the Nasdaq. CAN SLIM investors prefer for volume to be higher on an up day.

Small caps also made some headway amid the bull charge. The Russell 2000 was up 1.2%.

Almost all sectors were positive as stocks fought back after a tough Wednesday. Communication services, energy and technology are the leading sectors.

The Innovator IBD 50 ETF (FFTY) partook in the gains, rising 1.5%. It was a good day for the IBD 50, with more winners than losers. Outside of Inphi, the biggest winners were ServiceNow (NOW), which rose 6.5% after earnings, and Digital Turbine (APPS), which rose 6.2%. Losers included Meridian Bioscience (VIVO), which slipped 1.6%, and Virtu Financial (VIRT), which gave up 1.7%.

Apple Stock Helps Dow Jones Surge

The Dow Jones Industrial Average managed to fight back into positive territory after opening lower. It ended up closing with a gain of 0.5%.

Dow components were mostly positive. Apple stock led the charge with a strong gain of 3.7%. The company is announcing quarterly results after the close. Other winners included Chevron (CVX), which rose nearly 3%, and Walt Disney (DIS), which was up 2.6%. Disney stock rallied as season two of “The Mandalorian” gets set to premiere Friday. This is seen driving subscribers to its year-old streaming service.

Losers included Walgreens Boots Alliance (WBA), which dipped 3.1%, UnitedHealth (UNH), which slipped 1.4% and Johnson & Johnson (JNJ), which gave up 0.9%.

Inphi Stock Breaks Out On Deal

Inphi stock blasted past a cup-with-handle entry point of 125.93 in massive volume. It also entered a buy zone above a consolidation buy point of 142.10, MarketSmith analysis shows, though it has slipped back below this entry. Its relative strength line also hit a fresh high as it staged the bullish move.

The chip stock is soaring on the news Marvell Technology plans to buy Inphi in a cash and stock deal worth around $10 billion.

The IBD 50 stock has a best possible IBD Composite Rating of 99. Earnings are even stronger than stock market performance, with the stock holding an EPS Rating of 93.

Inphi was the IBD 50 Stock To Watch for Tuesday.

Winners And Losers Finely Balanced

The market saw a number of stocks making big price moves on unusually heavy volume, with losers and winners finely balanced.

As well as Inphi and ServiceNow, Macom Technology Solutions (MTSI) rose 11.5%, Netflix (NFLX) swelled 3.7% and PerkinElmer (PKI) was up 3.5%.

Marvell’s acquisition plan hit the stock, as it was down 2.6%. Other notable losers included Inovalon (INOV), which plunged 21.9%, and Spotify Technology (SPOT), which lost 3.4%.

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

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