The Dow Jones Industrial Average briefly rallied 350 points on Friday after the Labor Department’s pivotal October jobs report showed stronger-than-expected growth.
Friday’s jobs report showed the US economy added 261,000 jobs in October, more than the 210,000 expected, according to Econoday estimates. But the jobless rate rose to 3.7%, above the 3.6% estimate.
The main drivers of earnings on Friday were To block (SQ), Coinbase (PIECE OF MONEY), DoorDash (DASH), EOG Resources (EOG), Microchip (MCHP), PayPal (PYPL) and Starbucks (SBUX).
Bulk shares jumped 13%. COIN stock jumped 9% while DoorDash rose 15%. EOG Resources rose 5%, while Microchip rose 8%. Finally, PayPal fell 2% and Starbucks rose 9% in morning trading.
Electric vehicle giant You’re here (TSLA) was up almost 4% on Friday morning. Dow Jones Stock Amgen (AMGN) shares traded down 2% after the earnings release. Dow Jones Technology Leaders Apple (AAPL) and Microsoft (MSFT) were also higher after today’s stock market open.
Some of the best stocks to buy and watch include Arista Networks (A NET), Energy Cheniere (LNG), General dollar (DG) and Pure storage (PSTG) — as well as Dow Jones stocks Chevron (CLC) and UnitedHealth (A H). Keep in mind that the currently difficult stock market rally is a reason for investors to play more defense.
Cheniere is an IBD ranking title. Pure Storage was featured in this week’s Stocks Near A Buy Zone column, along with three other stock ideas. Pure Storage was also recently an IBD Stock Of The Day.
Dow Jones Today: Treasury Yields, Oil Prices
After Friday’s opening bell, the Dow Jones Industrial Average rose 1%, while the S&P 500 rose 0.95%. The tech-heavy Nasdaq composite climbed 0.8% in morning action.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) gained 0.8% and the SPDR S&P 500 ETF (SPY) gained 1%.
The 10-year Treasury yield rose to 4.16% on Friday morning after the jobs report. Meanwhile, US oil prices have risen more than 4% and are at their highest level since mid-October. West Texas Intermediate futures break above support at their 50-day moving average, trading above $92 a barrel.
Stock market rally struggles
On Thursday, the Dow Jones Industrial Average fell 0.5%, while the S&P 500 fell 1.1%. The tech-heavy Nasdaq composite lost 1.7% and the small-cap Russell 2000 was down 0.5%.
Thursday’s The Big Picture commented: “As of the October 21 track day, IBD recommends limited exposure (no more than 40%) due to this year’s market volatility and a pattern of failed track days. . And recent action has validated this more cautious approach.”
Now is an important time to read IBD’s The Big Picture column. Following recent selling, investors should focus more on defending than buying breakouts.
Five Dow Jones Stocks to Buy and Watch Now
Dow Jones stocks to buy and watch: Merck, UnitedHealth
Dow Jones and IBD 50 member Merck is out of the buy range past the 93.12 buy point of a double bottom base, according to IBD MarketSmith pattern recognition. Merck shares fell slightly on Friday.
Healthcare giant UnitedHealth is trying to surpass the 553.23 buy point of a cup with handle, according to IBD MarketSmith. The shares rose slightly on Thursday, holding below their last entry. UNH stock traded a fraction higher on Friday morning.
4 growth stocks to watch in the currentrStock market rally
Top stocks to watch: Arista, Cheniere, Dollar General, Pure Storage
IBD Leaderboard Arista Networks watchlist stock is approaching a buy point at 132.97 but could add a handful to its asymmetric formation, lowering the entry to 130.23. Shares jumped 8% after Piper Sandler took the stock from neutral to overweight on Friday morning.
IBD Leaderboard Cheniere Energy stock continues to hold just below a buy point of 178.69 in a handle cup. Look for a decisive rally in the entry before buying stocks. LNG shares rose 1% on Friday.
Dollar General fell further below a buy point of 259.75 in a cup basis, as DG shares lost 0.2% on Thursday, falling for a fourth straight day. Now, the stock will look for support around its 50-day line. Shares of DG rose 0.5% early Friday.
The recent IBD stock of the day, Pure Storage, broke Tuesday after a buy point of 31.62, but fell even further below that entry during Thursday’s 1.45% decline. The stock was up 2% on Friday.
Join IBD experts as they analyze the top stocks of the current stock market rally on IBD Live
Tesla stock edged higher on Thursday, taking a break from Thursday’s 5.6% slide. Stocks are holding just above their recent lows, around 48% off their 52-week high and well below their 50- and 200-day moving averages.
Shares of the electric vehicle giant rose nearly 4% on Friday morning.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares sold another 4.2% on Thursday, down sharply for a fourth straight day. The stock is poised to drop almost 11% this week. Apple stock traded 1.9% on Friday.
Microsoft fell 2.7% on Thursday, hitting a new 52-week low. The software giant is around 39% off its 52-week high. Microsoft shares rose 1.5% on Friday morning.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen to learn more about growth stocks and the Dow Jones Industrial Average.
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