Banking

Stocks Move Higher As Dow Leads, Nasdaq Lags; These Growth Stocks Break Out

The Dow Jones Industrial Average traded slightly higher in today’s stock market as all the major indexes continued modestly higher. The tech-heavy Nasdaq composite lagged the major indexes while the S&P 500 notched another new high in early trading.




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At around 1:30 pm ET, the small-cap Russell 2000 was the only major index in negative territory, down roughly 0.4%. Meanwhile, the Nasdaq gained 0.1%. The S&P 500 traded 0.3% higher after reaching a fresh high of 4108. The Dow Jones industrials rose nearly 0.4%. Early data showed volume fell on both the Nasdaq and the NYSE exchanges vs. the same time on Thursday.

The Nasdaq reversed higher after trading in the negative while the Dow Jones is set to close higher for it’s third-straight week. Tech stocks are taking a break Friday after leading the market all this week.

As treasury yields have receded in recent weeks, investors have moved back into growth stocks and large-cap tech plays such as Alphabet (GOOGL) and Facebook (FB). Both tech giants are trading near highs and remain inside key buy zones currently.

As for growth stocks, the Innovator IBD 50 ETF (FFTY) climbed 0.7%. The growth-focused index is still trading below the 50-day line but is close to reclaiming this key area of support.

IBD 50 stocks leading the upside on Friday were At Home Group (HOME) and BioNTech (BNTX) with gains of roughly 6% and 5%, respectively.

Growth Stocks Breaking Out

A small handful of stocks broke out Friday, including Leaderboard stock Floor & Decor (FND), furniture stock Lovesac (LOVE) and MarketSmith Growth 250 stock Boot Barn (BOOT).

Floor & Decor stock remains just below its 5% buy zone after breaking out and rising close to 4%. Shares broke out past a 108.64 consolidation buy point on Friday in heavy trading. The stock was recently added to IBD Leaderboard. The base also can be interpreted as a cup with handle with a 101.84 buy point. Additionally, the relative strength line is nearing highs.

The Atlanta-based retailer operated 133 warehouse-format stores and two design centers across 31 states at the end of Q4.

Elsewhere, IBD 50 stock Lovesac traded inside the buy zone of consolidation buy point at 66.10. Shares moved up more than 10% on Friday. Lovesac stock holds a strong Composite Rating of 94 but with an EPS Rating of 65, shows that its technical performance is outstripping earnings.

Lovesac reports earnings next week. For more details, check out the latest Earnings Preview story.

Finally, Boot Barn broke out from a 69.28 buy point in a six-week consolidation. Shares traded just pennies below the key buy area in early afternoon trading. The firm maintains an excellent 96 Composite, a 95 RS Rating and features a rising RS line.

Dow Jones Today

As for Dow components, UnitedHealth Group (UNH), Honeywell (HON) and Salesforce.com (CRM) led the upside with gains of over 1.5% each. On the downside, shares of Johnson & Johnson (JNJ) and Boeing (BA) were down 1% or more each.

Shares of Boeing fell nearly 2% upon announcing Friday that several airlines pulled some 737 Max jets from service due to a production issue. Boeing stock remains in a buy zone after breaking out of a cup base, according to MarketSmith analysis. The ideal buy point is 244.18, a dime above the cup’s left-side peak of 244.08.

Elsewhere in the Dow Jones, aerospace rival Honeywell rose over 2% after Deutsche Bank upgraded the stock from a hold to a buy. JPMorgan Chase also named Honeywell as a top pick. Shares are in the buy zone after breaking out of a flat base with an ideal entry of 216.80.

Apple (AAPL) rose another 1.6% on Friday as shares gain momentum above the 50-day moving average. The iPhone maker reclaimed this key area of support on Wednesday. The stock has notched a win streak of six straight sessions and is on track for a seventh.

On Feb. 18, Apple stock triggered the 7%-8% loss-cutting sell rule when it fell more than 7% below a 138.89 buy point of a cup with handle. Shares are currently building the right side of a consolidation with potential buy point at 145.19. The stock is roughly 9% away from the buy zone.

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