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Dow Jones Attracts Buyers Amid Tech Weakness; Sellers Hit Zoom Video Stock Despite Bullish Earnings, Guidance

The stock market took a step back Tuesday after bullish gains in lower volume Monday. Target stock reversed sharply lower after initially popping on earnings. Apple stock lagged in the Dow Jones today, but a 1% decline didn’t look too bad in light of Monday’s 5.4% gain. Still, Apple (AAPL) is firmly below its 10-week moving average and looks like it’s ready to form a new base.




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Selling was mostly concentrated in the Nasdaq and the Russell 2000 small-cap index. The Nasdaq 100 and Nasdaq composite were down around 0.7%, and the Russell 2000 gave back 1%.

Chip-equipment stocks like Applied Materials (AMAT), ASML (ASML), KLA (KLAC) and Lam Research (LRCX) lagged in the Nasdaq 100. The Philadelphia Semiconductor index was down close to 1.7%.

The Dow Jones industrials edged higher by 0.1%, buoyed by s 3.5% gain for Dow Inc. (DOW). The S&P 500 eased 0.1%. Volume on the NYSE was higher compared to the same time Monday. Nasdaq volume was lower.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 31559.31 +23.80 +0.08
S&P 500 (0S&P5) 3895.24 -6.58 -0.17
Nasdaq (0NDQC ) 13483.94 -104.89 -0.77
Russell 2000 (IWM) 223.28 -2.79 -1.23
IBD 50 (FFTY) 47.44 -0.42 -0.88
Last Update: 1:24 PM ET 3/2/2021

Among the best ETFs, the Innovator IBD 50 ETF (FFTY) eased 0.7% after a nice test of its 50-day moving average last week. The Innovator IBD Breakout Opportunities ETF (BOUT) fell 2.1%. The iShares Expanded Tech-Software Sector ETF (IGV), which is testing support at its 50-day line, gave back 0.9% and the VanEck Vectors Semiconductor ETF (SMH) slipped 1.8%.

Inside the IBD 50, InMode (INMD) was a nice gainer, up nearly 6%. Headed into this week, InMode’s weekly chart had the appearance of a three-weeks-tight pattern, but it didn’t quite pass muster due to the stock’s 1.7% gain for the week ended Feb. 19. Still, tight trading near highs after a strong uptrend was a sign of strength and support.

InMode was featured in Monday’s Screen Of The Day column, which showcased several stocks showing rising fund ownership in recent quarters.

Outside The Dow Jones

Target (TGT) broke out over a trend line early Tuesday, rising 4%, but a wave of selling hit the stock, knocking shares lower by nearly 5%. The retailer reported another strong quarter, with adjusted profit up 58% and revenue up 21% to $28.3 billion. Target’s curbside pickup and its home delivery service, Shipt, have been popular with consumers. Same-day services sales jumped 212% in the quarter. Sales at Target’s curbside pickup service Drive Up surged by more than 500%.

Target joined Leaderboard on Nov. 18 when it cleared  a 167.52 buy point, but today’s sell-off prompted its removal from the list.

General Motors (GM) extended gains after joining Leaderboard Monday. It’s making a solid first test of its 10-week moving average after a breakout from a cup base in January. Competitor Ford (F) jumped to a new high. It’s still in buy range after a breakout over the 12 level.

DraftKings (DKNG) bucked the trend, rising 1%. It rejoined the Leaders list Monday when the stock surged past a 64.88 buy point.

Earnings Watch

In earnings news, Zoom Video (ZM) pared a 7.4% gain to a loss of 4.5% despite another quarter of strong growth and bullish guidance. After a sharp pullback, Zoom Video found support at its 40-week moving average, but it’s more than 30% off its high. That means Zoom Video will have some overhead supply issues to work through if starts rallying again.


Join IBD experts as they analyze leading stocks in the stock market rally on IBD Live


Fast-growing Chinese electric car maker Nio (NIO) slumped 10% despite news that Q4 sales jumped 149% to $1.02 billion. But Nio said a global chip shortage will slow production.

Former leader Lemonade (LMND) also sold off on earnings. The insurer was first discussed on IBD Live in early December, when it was trading around 90. The stock eventually broke out to new highs and doubled in price, but Lemonade flashed a sell signal last week with a decisive break of the 10-week moving average.

In other stock market news, plastics firm Avient (AVNT) outperformed, up nearly 2% to 45.85. The stock was discussed on IBD Live this morning as it vies for a breakout from an eight-week consolidation with a 46.48 buy point.

Inside the MarketSmith Growth 250, steel producer Ternium (TX) added nearly 4% to 33.71. It’s near the top of a cup base with a 34.09 buy point.

Follow Ken Shreve on Twitter @IBD_KShreve for more stock market analysis and insight.

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