October 20, 2021

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Dow Jones Holds Modest Gain While Nasdaq Notches New High; Costco Stock Breaks Out

The Dow Jones Industrial Average rose in today’s market as stocks continued to recover some of last week’s steep losses. The Dow added nearly 70 points after its 500-plus point gain on Monday. All the major indexes traded off their highs of the day at the close on Tuesday.


Stock Market Today

The Nasdaq held a gain of 0.8%. The S&P 500 rose 0.5%, while the Dow Jones industrials added 0.2%, after paring earlier gains. Meanwhile, the small-cap Russell 2000 index climbed 0.4%. Volume was running lower on the NYSE and on the Nasdaq vs. the close on Monday, according to early data.

Stocks were rocked last week after the Federal Reserve said it sees interest rates rising sooner than previously expected. The Dow suffered a weekly loss of over 3% on the news. However, the major index has recovered more than half those losses so far this week.

Last week, IBD changed its stock market outlook from confirmed uptrend to uptrend under pressure after the major indexes extended weekly losses.

On Monday, the blue chip index saw its biggest jump since March with a gain of over 500 points. Meanwhile, the Nasdaq hit a new high on Tuesday of 14,269.77.

Dow Jones Today

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 33945.71 +68.74 +0.20
S&P 500 (0S&P5) 4246.46 +21.67 +0.51
Nasdaq (0NDQC ) 14253.27 +111.79 +0.79
Russell 2000 (IWM) 228.07 +1.19 +0.52
IBD 50 (FFTY) 44.67 +0.42 +0.95
Last Update: 4:42 PM ET 6/22/2021

Most blue chips traded higher on Tuesday. Shares of Microsoft (MSFT) rose 1.1% in afternoon trading. The stock touched the $2 trillion market cap level, and closed just under that benchmark. The blue chip tech stock’s rival Apple (AAPL) was the first to achieve the milestone.

Also, on Tuesday, Microsoft stock broke out past a new cup base’s 263.29 buy point, according to IBD MarketSmith chart analysis. The buy zone tops out at 276.45. The stock’s relative strength line has been trending softly higher in recent days.

But beware of the tech firm’s low RS Rating of 61, out of 99. On the positive side, the stock still holds a Composite Rating of 90, which is strong.

Elsewhere in the Dow, Nike (NKE) was a top performer, rising over 1.8% in afternoon trading. Shares gained ahead of the firm’s Q4 earnings report, which is due late Thursday. The stock recently dipped below its 50-day and 200-day moving averages but is attempting to reclaim these key areas of support.

Stocks In The News

As for growth stocks, the Innovator IBD 50 ETF (FFTY) held a solid gain of almost 1% as shares remain below the 50-day line. Stocks leading the upside in the index included Figs (FIGS) and CrowdStrike (CRWD).

Cybersecurity stock CrowdStrike broke out from a stage-three consolidation with a 251.28 buy point. The stock reported earnings on June 3, which helped propel shares into the current buy zone. The firm reported year-over-year EPS growth of 400%, while revenue increased 70%.

CrowdStrike stock maintains very strong IBD ratings, with a 90 Composite Rating and an 87 Relative Strength Rating. But investors should note that the current base is a third-stage base, which indicates a lower probability of success than with an earlier-stage base.

Stocks Breaking Out

On Tuesday, some stocks from the MarketSmith Growth 250 list broke out and traded inside buy zones.

Boot Barn (BOOT), which operates over 250 footwear stores in 36 states, broke out from a flat base with an 80.20 buy point. The stock is occasionally mentioned on IBD Live and has a perfect 99 Composite Rating. The stock’s relative strength line is also at all-time highs, a bullish sign.

The stock remains inside the buy area, which tops out at 84.21. Boot Barn’s RS Rating of 96 is strong and remains well above the minimum 80 we like to see for growth stocks breaking out.

Elsewhere, Costco (COST) broke out from a large cup-with-handle base with a 389.55 buy point. Shares rose as much as 1.5% and remain inside the 5% buy zone. Costco’s volume was light on the breakout, which is a cause for concern. The stock also has a lukewarm 71 Composite Rating but a strong 90 EPS Rating, showing that earnings play a big role in this stock’s strength.

Follow Rachel Fox on Twitter at @foxonstocks for more Dow Jones and market commentary.


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