Dow Jones Falls As Powell Is Confirmed; Yields Dip; Bitcoin Dives Amid Crypto Bloodbath

The Dow Jones Industrial Average rebounded late but still closed lower as the stock market continued to struggle. Federal Reserve Chairman Jerome Powell has received Senate approval to run for a second term. Bitcoin dives into the middle of a cryptographic bloodbath, with Bitcoin Trust Grayscale (GBTC) e Coinbase (COIN) among the actions caught in the crossfire.


Ford (F) e General Motors (GM) has been downgraded. It’s worth adding a couple of actions to your watchlist while creating bases. Diamondback Energy (FANG) e SM Energy (SM), both names IBD 50, are developing bullish patterns.

Volume rose on both the Nasdaq and the New York Stock Exchange compared to Wednesday, according to early data.

Oil rose again, with West Texas Intermediate crude rising 1% to trade at nearly $ 107 a barrel.

Fed Chairman Powell overcomes the key hurdle

Powell passed a major test Thursday after the Senate gave him a second term. In an 80-19 vote, it gave him a second four-year term at the helm of the world’s largest central bank.

During his watch he had to deal with two major crises: the Covid pandemic and the inflation that has reached the highs of the last 40 years.

Powell has been criticized by some economists for trying to be too precise in his language at the most recent FOMC meeting. He said a 75 basis point hike “is not something the committee is actively considering” despite the inflation spiral.

Meanwhile, the 10-year Treasury bond yield fell four basis points to 2.86%. It was trading at up 2.84% at the start of the day.

Yields are inversely related to price. The decline in recent highs suggests that investors are fleeing to safer assets such as bonds amid stock market turmoil.

Nasdaq reverses as technology stocks are hammered

The Nasdaq was the best of the major indices, closing fractionally positive with a gain of 0.1%. Lucid Motors (LCID) came out better as it charged 13.2%.

The S&P 500 rebounded to a low of 0.1%. Carpet (TPR) was a winner here, rising 15.5%.

US stock market overview

Index Symbol Price Gain / Loss % change
Dow Jones (0DJIA) 31730.04 -104.07 -0.33
S&P 500 (0S & P5) 3930.29 -4.89 -0.12
Nasdaq (0NDQC) 11370.96 +6.72 +0.06
Russell 2000 (IWM) 172.74 +2.14 +1.25
IBD 50 (FFTY) 29.29 +0.00 +0.00
Last updated: 12:12 ET 5/12/2022

The S&P sectors closed mixed. Technology and utilities were worse, while health care and discretionary consumption got the best benefits.

Small caps were the stars of the day, with Russell 2000 up 1.2%.

Growing stocks were only to end stagnation. The Innovator IBD 50 ETF (FFTY) has closed completely.

Dow Jones Today: Apple Stock, Disney Reverse

The Dow Jones Industrial Average struggled against lows but still yielded more than 100 points. It fell 0.3%.

Shares of Apple were among the worst performers, falling 2.7%. He is now very shy of all his major moving averages. Boeing (BA) was the worst performer, falling 4.8%.

Disney (DIS) also faced a 0.9% drop. It has shrunk after losing analysts ’views on both earnings and revenue growth in the last quarter. Home Depot (HD) e 3M (MMM) were the ones that got the best performance, with both rising more than 2%.

Cryptographic stocks mixed while Bitcoin falls

Bitcoin fell again on Thursday amid turmoil in the cryptocurrency markets.

It was hit after Tether, a supposedly stable currency pegged to the U.S. dollar, fell nearly 5 cents below the asset it is intended to track. He later recovered.

This happens after the failure of the smaller rival TerraUSD. Today it emerged that Earth must stop new transactions in its blockchain, the underlying technology that drives cryptocurrency.

Credit rating agency Fitch said the problems affecting both stablecoins “will speed up regulatory requests”.

According to CoinDesk, Bitcoin, the world’s most valuable cryptocurrency, has fallen more than 3% to less than $ 29,000. She was even lower at the start of the session.

Actions related to cryptography had mixed fortunes. Grayscale Bitcoin Trust fell 3.7% while cryptocurrency exchange Coinbase went red to close 8.9%. Bitcoin mining Riot Blockchain (RIOT) also managed to get out of negative territory to rise 6.9%.

S&P 500 Bear Flirting on the Wild Day; These Rally Markets

GM stock, Ford shares reverse decline

Both GM and Ford closed lower after being slapped with a double drop.

Wells Fargo analyst Colin Langan downgraded the two overweight car manufacturers to low weight. It has also reduced its target price for Ford from 24 to 12 and for GM from 74 to 33.

The analyst believes this year could be a peak of profits for flagship carmakers. He believes the pivot to electric vehicles could end up affecting the end result in the coming years. Langran said the costs of electric vehicles “have risen massively” and that supplies of raw materials are scarce.

Shares of Ford closed at 3%, losing ground on the 50-day moving average. Ford was one of the best performing stocks of 2021.

GM shares closed up 4.6%. It is now 14% below its 50-day line and more than 30% below its 200-day moving average.

Outside the Dow Jones: These stocks are building bullish bases

The stock of IBD 50 Diamondback Energy is forming a new consolidation pattern, according to MarketSmith analysis. At 127.04 it is well below the ideal point of purchase of 148.09.

The relative strength line is at its maximum on a weekly chart, an advantage. Investors will seek to resume the 50-day moving average. This is a second stage foundation, which counts as an initial stage, which makes you more likely to succeed. Analysts see EPS growth of 118% in 2022.

SM Energy is also forming an indefinite consolidation. The ideal point of purchase here is 43.79. Shares have remained above the 200-day moving average, but need to resume their 50-day line.

Overall performance is strong, which is reflected in the best possible IBD composite valuation of 99. Shares are the favorites of institutions, as 61% of shares are currently held by funds.

Follow Michael Larkin on Twitter at @IBD_MLarkin for more information on growth stocks and analysis.

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