The Dow Jones Industrial Average, S&P 500 and Nasdaq composite were off session highs in afternoon trading Tuesday, with three trading days left in 2020. Apple stock scored an all-time high in the Dow Jones today, while Chinese stocks like Pinduoduo (PDD), JD.com (JD) and Baidu (BIDU) outperformed in the Nasdaq 100.
Baidu stock continues to show bullish technical action, trading tightly and holding near highs after soaring 19.5% during the week ended Dec. 18.
Small caps fared the worst, with the Russell 2000 down 2%. But after eight straight weekly gains for the small-cap index, some consolidation should be expected. Selling was more muted in the broad market, with the Dow Jones industrials, S&P 500 and Nasdaq composite down 0.1% to 0.3% at around 1:33 p.m. ET. Volume on the NYSE and Nasdaq was lower compared with the same time Monday.
The stock market weakened a bit after Senate Majority Leader Mitch McConnell blocked an attempt by Senate Minority Leader Chuck Schumer to unanimously approve $2,000 coronavirus-aid stimulus checks cleared Monday by the Democrat-controlled House.
U.S. Stock Market Today Overview
Last Update: 1:12 PM ET 12/29/2020
The Nasdaq composite is a little stretched at 7% above its moving average. A market pullback could come at any time, but the distribution day count for the S&P 500 and Nasdaq is still relatively light, with four distribution days on the S&P 500 and three on the Nasdaq. Of the S&P 500’s four distribution days, three showed mild declines of 0.3% to 0.5%. Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
Dow Jones Stocks To Watch
Amid plenty of calls for a stock market pullback, there’s no shortage of stocks in the Dow Jones that could be poised for upside breakouts.
Apple (AAPL) backed off highs after hitting an all-time high of 138.06. Shares were strong early on bullish comments from Gene Munster, a top Apple analyst. Apple joined Leaderboard on Dec. 1 when it broke out over a trend line. It cleared an alternate proper entry of 125.49 when it gapped up on Dec. 15.
JPMorgan (JPM) is still in buy range from a 123.60 handle entry on a long, deep consolidation. Financial stocks have been buoyed by rising Treasury yields and widening Treasury spreads. JPMorgan reports earnings on January 15, along with Citigroup (C), PNC Financial Services (PNC) and Wells Fargo (WFC).
American Express (AXP) gapped up on Nov. 9 and has done a good job holding gains since then. It still has a ways to go to get to an alternate buy point at 125.42, 10 cents above its Dec. 4 intraday high.
Coronavirus vaccine stock Johnson & Johnson (JNJ) is near the top of a long consolidation with a 155.20 buy point.
IBD 50 Movers
Growth stocks were under pressure for a second straight session Tuesday. After falling nearly 2% Monday, the Innovator IBD 50 ETF (FFTY) was down an additional 1.3%, weighed down by weakness in Digital Turbine (APPS), Smith & Wesson (SWBC), Chegg (CHGG) and Trade Desk (TTD).
Inside the MarketSmith Growth 250, several leading biotech stocks came under intense selling pressure. Editas Medicine (EDIT), Intellia Therapeutics (NTLA), Ultragenyx Pharmaceutical (RARE) and Twist Bioscience (TWST) showed losses ranging from 12% to 14%.
Follow Ken Shreve on Twitter @IBD_KShreve for more stock market analysis and insight.
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