The stock market took a turn for the worse in afternoon trading after President Trump called off stimulus negotiations on Capitol Hill until after the election. The stock market wasn’t moving much in either direction before the Trump tweet. Apple (AAPL) lagged in the Dow Jones today, down more than 2.5%. Earlier in the session, Apple set an Oct. 13 date to introduce its latest iPhone.
The Russell 2000 small-cap index was the star of the day before the stimulus news, up 1.9%. The iShares Russell 2000 ETF (IWM) broke out over the 160 level was well off highs, up 0.5% in late trading.
Another bullish move for Group 1 Automotive (GPI) helped the Russell 2000. After a breakout Monday over a 98.54 buy point, Group 1 soared another 15% after the company reported strong preliminary Q3 results, announced a $200 million share buyback and reinstated its dividend.
Stocks backed off highs in the morning after Federal Reserve Chairman Jerome Powell called for additional fiscal and monetary stimulus to support the economy.
The Dow Jones industrials were down 1.1%. The stock market went back into a confirmed uptrend when the Dow Jones jumped 1.2% on Sept. 30. The Dow closed off its high, but it still qualified as a follow-through day.
U.S. Stock Market Today Overview
Last Update: 3:38 PM ET 10/6/2020
The Nasdaq composite fell 1.3% after surging 2.3% Monday. The Nasdaq showed follow-through-type price action with bullish gains on Sept. 25, Sept. 28, last Thursday and on Monday. But volume was lower on all four days. Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
The S&P 500 lost 1.2%. Volume on the NYSE and Nasdaq was higher compared with the same time Monday.
Outside the Dow Jones
Inside the MarketSmith Growth 250, recent IPO American Well (AMWL), known as Amwell, followed through powerfully after Monday’s breakout from an IPO base with a 32.09 buy point. After jumping 16% Monday, shares were up another 10.5%.
Along with Amwell, several IPOs have come to market recently that show big sales growth in recent quarters. Names like Snowflake (SNOW), GoodRx (GDRX), JFrog (FROG) and Unity Software (U) should be watched for IPO bases.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) rallied 1% early, helped by a bullish gain for software leader Veeva Systems (VEEV). Veeva Systems joined Leaderboard Tuesday as it forms a flat base with a 298.86 buy point. Veeva topped a 287.28 early entry Tuesday, 10 cents above its Sept. 28 high.
The iShares Expanded Tech-Software Sector ETF (IGV) pared a 1.2% intraday gain to mostly flat, while the VanEck Vectors Semiconductor ETF (SMH) reversed lower for a loss of 0.7%. Leaderboard stocks Taiwan Semiconductor (TSM) and Nvidia (NVDA) are the top two holdings of the chip ETF.
Insurer Palomar (PLMR) plunged more than 15% after the company forecast heavy Q3 losses as a result of Hurricanes Hanna, Isaias, Laura and Sally. Tuesday’s gap below the 50-day moving average is an unequivocal sell signal.
Follow Ken Shreve on Twitter @IBD_KShreve for more stock market analysis and insight.
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