Stock Market Continues to Rebound as Nasdaq Jumps Nearly 2%; Energy, solar energy in the lead
The stock market continued its rebound on Thursday, led by the Nasdaq composite. Investors have seen jobless claims rise in hopes that more people quitting their jobs will reduce inflation. Energy and solar stocks dominated the markets.
The Nasdaq jumped 1.9%, the S&P 500 1.1% and the Dow Jones Industrial Average 0.7%. Small caps dominated the stock market as the Russell 2000 rose 2.4%.
Volume fell on the Nasdaq and NYSE from the same time Wednesday.
Rising jobless claims indicate economy is slowing
The number of jobless claims rose to 235,000 from 231,000 the previous week, according to the US Department of Labor. Economists polled by Econoday had forecast 230,000. The figures show labor market growth is slowing.
Overview of the US stock market today
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Last Updated: 1:18 PM ET on 07/07/2022
“It’s never a good thing to see layoffs, but wage pressure may have peaked,” said Jamie Cox, managing partner of Harris Financial Group. “A few more weeks of these types of numbers and maybe, just maybe, financial conditions are tight enough to allow the Fed to slow the magnitude of rate hikes.”
Meanwhile, the yield on the 10-year Treasury note climbed 7 basis points to 3.0%, rising above 3% for the first time since June 30.
The rise in the price of US crude oil rose back above $100 a barrel, jumping more than 5% to $103.80. Energy Select Sector SPDR (XLE) led S&P sector ETFs with a 3.8% increase.
All S&P sectors were up except Consumer Staples and Utilities, which fell 0.3% and 0.1% respectively.
Energy and solar stocks dominate the stock market
Solar and coal stocks dominated the energy sector. IBD Stock 50 Daqo New Energy (DQ) jumped more than 12%.
Enphase Energy (ENPH) climbed more than 6%. Coal stocks Arch Resources (ARCH) and Metallurgical Alpha (AMR) climbed more than 8% as it attempts to break a strong downtrend.
In heavy construction, Quantum Services (PWR) jumped nearly 4% and is back above its 50-day moving average as it forms an imperfect grip cup base.
Innovator IBD 50 ETF (FFTY) rose more than 1.4%. IBD Stock 50 Funko (FNKO) climbed 2% past its buying point as it prepares to display its toys and collectibles at Comic-Con this month. With its relative strength line already hitting a new high, Funko just broke a buy point of 25.18 in a mug with handle. The stock remains in the buy zone and is trading well above its 50-day moving average.
GameStop (GME) gained nearly 13% on news of a 4-for-1 stock split expected later this month.
The healthcare sector continues to grow
In health care, two stocks topped buy points.
Cigna (CI) broke out from a base in large volume. The managed care provider has breached its buy point of 273.67 and is in a buy range at 287.35. Therapeutic Halozyme (HALO) broke above a buy point of 48.68 in high volume. It is in a buy zone at 51.11.
IBD Ranking Stock Evolutionary Health (EVH) is in the buy range off a buy point of 33.24 in a cup with a handle after Wednesday’s breakout of 4.5%. Shares of Evolent gained 2.7% on Thursday.
Merck (MRK) is in advanced talks to acquire seagen (SGEN) in a deal that could be worth around $40 billion. Shares of Seagen rose 2.2%, while Merck fell 0.2%.
You’re here (TSLA) gained more than 4% on Thursday but was still significantly below its 50- and 200-day moving averages. Tesla stock traded as high as 1,243.49 on November 4.
Follow Michael Molinski on Twitter @IMmolinski
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