Dow Jones Erases 433-Point Early Drop As These 5 Stocks Are Defying The Trump Coronavirus Infection Sell-Off – Investor's Business Daily

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The Dow Jones Industrial Average made a stunning bounce off its early-morning lows in the stock market today and cut losses to around 0.2% in late-afternoon trading. But other indexes reflected fear over the state of the White House following President Trump’s late-night admission that he and first lady Melania Trump both tested positive for coronavirus.

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Non-tech issues helped the Dow’s cause.

Within the 30-stock Dow industrials, at least seven blue chips gained 1 point or more, including McDonald’s (MCD), Caterpillar (CAT), Dow (DOW) and Home Depot (HD). With ultra-low interest rates, homebuilding ramping up and coronavirus still raging, Home Depot represents ongoing strength in the construction sector.

As seen in IBD’s sector-based stock tables, Building occupies the No. 6 slot among 33 sectors for mid- and long-term relative price performance.

Salesforce.com (CRM), a new idea on IBD SwingTrader, Microsoft (MSFT) and Amgen (AMGN) hurt the Dow with losses of 5 points or more.

News outlets reported that Donald Trump is encountering “mild symptoms” of the disease. Coronavirus has already taken more than 208,000 American lives and counts 7.3 million infections — or roughly 1 in 45. Meanwhile, both Vice President Mike Pence and Democratic presidential candidate Joe Biden both tweeted they tested negative for Covid-19.

Nevertheless, megacap techs got pounded, sending the Nasdaq composite down more than 1.8% with an hour to go in the regular session. At one point, the market value-weighted index fell as much as 2.6%.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 27779.03 -37.87 -0.14
S&P 500 (0S&P5) 3360.70 -20.10 -0.59
Nasdaq (0NDQC ) 11118.65 -207.86 -1.84
Russell 2000 (IWM) 152.98 +0.80 +0.53
IBD 50 (FFTY) 37.36 -0.44 -1.16
Last Update: 3:08 PM ET 10/2/2020

Watch how both the Nasdaq and Dow industrials finish for the day. A close above the 50-day moving average, for now, may indicate that institutions are not dumping shares en masse.

The S&P 500 slipped around 0.6%, faring better than a 1.3% slide by Innovator IBD 50 (FFTY).

Mixed Trading

Volume is running lower vs. the same time Thursday on the Nasdaq and 9% higher on the NYSE.

Earlier this week, IBD upgraded the general outlook for stocks. Please read the Sept. 30 Big Picture column for details.

The White House coronavirus news was not the only major headline for the U.S. The economy produced a net 661,000 jobs in September, down sharply from a 1.49 million-job increase in August. The September data sharply missed the Reuters consensus forecast of 850,000 and 891,000 by Econoday.

Interestingly, the leisure and hospitality sector saw a 318,000-job boost and accounted for nearly half the rise in nonfarm employment last month, Reuters reported. The jobless rate fell to 7.9% from 8.4% last month.


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Beyond Dow Jones: 5 Top Stocks To Watch

Meanwhile, at least five growth companies, many of them benefiting from the nation’s efforts to tame Covid-19 and the economy’s even bigger shift to a work from home and stay at home, showed resilience.

West Pharmaceutical Services (WST) eased just 0.4% and is still up nearly 2% for the week. The stock’s recent sideways price action is a plus. Please read more analysis in this recent IBD 50 Stocks To Watch feature.

Veeva Systems (VEEV) is trying to stage a third straight weekly advance.

The member of IBD’s medical software industry group is forming a flat base while holding on the north side of its 10-week moving average. It ranks No. 17 within IBD Big Cap 20 while Shopify (SHOP), which retook its 10-week line earlier this week, holds the No. 15 spot.

Shopify is forming a new base. For now, it’s offering a potential buy point at 1,047.01.

Please see this new Inside Big Cap 20 column on a recent bullish move in the e-commerce platform’s daily chart action.

Zoom Video (ZM) looks poised to snap a six-week win streak. But shares still remain sharply extended from a recent follow-on buy point at its 10-week moving average during a strong bounce off the intermediate-term technical level near 258 during the week ended Aug. 21.

The videoconferencing platform’s shares have vaulted more than 400% since clearing a 93.40 buy point in a first-stage cup with handle in late February.

Emerging Leader In Biotech

Ultragenyx (RARE) is trying to finish higher for the week. The biotech aiming to treat serious genetic diseases got some airtime in Friday’s IBD Live show. The midcap growth stock is forming a double bottom that features a 91.02 buy point.

The Novato, Calif., firm reported earnings of 41 cents a share on a 156% bulge in revenue to a record $61.7 million.

Please follow Chung on Twitter at @SaitoChung and at @IBD_DChung for more on growth stocks, chart analysis, bases, breakouts and sell signals.

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