Dow Jones Falls After Key Economic Data; Tesla Downgraded Amid Price Hikes

Dow Jones Industrial Average reverses lower after the release of important economic data. Manufacturing and services data were released. Tesla's (TSLA), stock, added to its Thursday losses on Friday morning amid an analyst downgrade following the company's decision to raise prices in the United States for its Model S and Model X cars.

S&P Global Flash Purchasing Managers' Index was released Friday morning. It is a preliminary reading of private sector output for April. The manufacturing index was in expansion with a reading of 50.4, whereas the services index was higher than expected at 53.7.

CSX, Freeport-McMoRan, HCA Healthcare, Procter & Gamble and SLB are among the companies that have seen their earnings rise on Friday morning.

CSX shares rose 3.4% in early trading, while Freeport shares fell 3.2%. PG shares jumped 2.7% and SLB fell 2% early on. HCA jumped 6.5%.

Stock Market Today

Tesla, the EV giant, reversed 0.5% lower on Friday morning. It is still trying to recover from Thursday's huge losses. Apple (AAPL), Microsoft (MSFT), and other Dow Jones tech giants were down after the stock market opened today.

The current market rally is a good time to invest in Crocs, DraftKings, Floor & Decor and IBD SwingTrader stocks Lululemon Athletica and JPMorgan Chase.

JPMorgan Lululemon and IBD Stock of the Day on Monday.

Dow Jones Today: Oil prices, Treasury Yields

The Dow Jones Industrial Average fell by 0.1% after Friday's opening, while the S&P 500 dropped by 0.2%. In morning trading, the tech-heavy Nasdaq Composite fell 0.5%.

The Nasdaq-100 tracker Invesco QQQ Trust, (QQQ), fell 0.5% while the SPDR S&P500 ETF, (SPY), traded at a loss of 0.1% on Friday morning.

On Friday, the 10-year U.S. Treasury bond yield fell to 3.51%. It is still on track for modest gains in this week. The 10-year yield recovered last week from its lowest point since mid-September.

The U.S. crude oil price appeared to be reversing a four-day decline from its April 12th high of $83 per barrel. West Texas Intermediate futures also edged up, Friday, between $77-$78 per barrel.

Stock Market Rally

The Dow Jones Industrial Average fell 0.3% on Thursday, continuing a losing streak that now spans three sessions. Verizon Communications (VZ), down 3.65%, was the biggest loser in this benchmark. The S&P fell by 0.6% and the tech-heavy Nasdaq Composite dropped by 0.8%.

In the Big Picture column on Thursday, it was noted that "After big gains were made on April 13, stocks have quietly traded sideways. This can be seen as bullish movement." IBD continues to recommend a 40%-60% exposure despite the calm and relatively low distribution day count.

The stock market is on an upward trend, so now is a good time to read IBD The Big Picture.

Dow Jones Stocks to Buy and Watch: JPMorgan Nike Visa

According to IBD MarketSmith's pattern recognition, JPMorgan's shares fell 0.3% on Thursday. They remained near the 144.44-point buy point of a flat basis in response to last week's earnings surge. JPM's stock fell 0.9% on Friday morning.

Nike shares dropped 1% on Thursday. They are still above the 50-day line. Stock is near a flat-base purchase point of 131.41 and just below an early entry price of 126.16. NKE shares fell 0.4% during early trading.

Visa shares are still in the buy range if they remain above a cup-with handle buy point of 230.15. The range of buys goes up to 24,1.66. V shares rose 0.2% early in the morning. Visa will report its fiscal second quarter results on April 25, 2019.

Crocs and DraftKings are the best stocks to buy and watch.

According to IBD MarketSmith, Crocs shares rose 0.9% on Thursday. They were higher in the range of buys past a cup's buy point at 143.60. The 5% range extends up to $150.78. CROX's stock rose 0.3% in the early hours of Friday. The company will report its first-quarter earnings to shareholders on April 27.

Backstory: Broomfield-based Crocs, best known for their rubbery casual shoes, is headquartered in Colorado. In recent years, the company expanded its Crocs portfolio beyond classic slip-ons to include sneakers, wedges, boots and sandals. Crocs accounts for around 75%.

DraftKings has a long way to go before it reaches the 21.72 cup-base buy point, despite breaking a five day winning streak on Thursday. DKNG's stock rose by 0.1% on Friday morning.

Backstory: Boston-based DraftKings offers daily fantasy sports games that allow users to win cash. According to a survey by the Pew Research Center, around 20% of U.S. adult respondents said they had bet on sports in one way or another in the past 12 months. DraftKings will report its first-quarter results to the public on May 4.

Floor & Decor, Lululemon

Floor & Decor is just a few cents below the 99.47 purchase point for a cup with handle. Watch for a decisive takeover of the entry to signal a buy. FND's shares rose 0.7% in the early hours of Friday. Floor & Decor will report its first-quarter results on May 4.

Floor & Decor is a retailer with 191 warehouses and six design studios in 36 states. It sells wood, tile, laminate, vinyl and natural stone products. The company also sells decorative items. The earnings are expected to drop 2% in 2019 before increasing by 27% in 2020 and 24% in 2030.

Lululemon, a stock on the IBD Leaderboard Watchlist, again surpassed its entry point Thursday. The stock rose 1.8% and closed in the buy range above an 371.36 purchase point in a cup handle. Shares were up 0.3% on Friday morning.

Lululemon raised its 2023 guidance on March 28 after exceeding earnings and revenue expectations for the fourth quarter holiday season. This sparked a 12.7% increase on March 29. The retailer of yogawear and athleisure clothing's final results for the fourth quarter also surpassed its own preliminary announcement from early January.

The Dow Jones Leaders are among the four best stocks you can buy today.

Cup with handle (Visa (V) 230.15)
Cisco Systems (CSCO) 51.84 Flat base

Source: IBD data as of April 20, 2023

Tesla Stock Drops on Earnings

Tesla shares plunged by 9.75% on Thursday after the company reported lower-than-expected revenue and profit margins. The shares closed at their lowest levels since January 26.

In recent weeks shares have triggered the loss rule of 7%-8% from a purchase point at 200.76 on a cup handle. They also fell below their key 50-day line – a critical level – which is a strong sell signal. Stock closed Thursday at a 55% discount to its 52-week peak.

Ark Invest, Cathie Wood’s firm, predicted a Tesla stock price of $2,000 by 2027. Ark ETFs bought 256,000 Tesla stock shares on Thursday.

Tesla increased the prices of its Model S and Model X electric vehicles in the U.S. on Friday morning. Both the Model S luxury sedan as well as Model X SUV prices were raised by $2,500. Truist downgraded Tesla from buy to holding, and lowered the price target from 245.

TSLA's stock appeared to be on the rise Friday morning but reversed lower in early trading.

Dow Jones Leaders - Apple and Microsoft

The stock closed at 157.48, just outside the 5% range. AAPL's stock fell 0.5% on Friday. Apple will report its fiscal second quarter results on Friday, May 4.

Microsoft shares remain in the buy zone past a flat-base's buy point of 276.86, even with a loss of 0.8% on Thursday. The 5% area is a rise from the buy-point to 290.70. On Friday, MSFT's stock fell 0.7%. The company will report its fiscal second quarter results on April 25, 2019.