Dow Jones Drops 200 Points On Hot Inflation Data; Tesla Stock Falls Before AI Day

Dow Jones Surges 350 Points On Strong Jobs Report

The Dow Jones Industrial Average briefly rallied 350 points Friday after the Labor Department’s pivotal October jobs report showed stronger-than-expected growth.

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Friday’s jobs report showed that the U.S. economy added 261,000 jobs in October, higher than the expected 210,000, per Econoday estimates. But the unemployment rate rose to 3.7%, above the 3.6% estimate.

Key earnings movers Friday were Block (SQ), Coinbase (COIN), DoorDash (DASH), EOG Resources (EOG), Microchip (MCHP), PayPal (PYPL) and Starbucks (SBUX).

Block shares surged 13%. COIN stock jumped 9% as DoorDash raced 15% higher. EOG Resources moved up 5%, while Microchip rallied 8%. Finally, PayPal dropped 2%, and Starbucks jetted 9% higher in morning trade.

Electric-vehicle giant Tesla (TSLA) traded up almost 4% Friday morning. Dow Jones stock Amgen (AMGN) shares traded down 2% after reporting results. Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) were also higher after today’s stock market open.

Among the top stocks to buy and watch are Arista Networks (ANET), Cheniere Energy (LNG), Dollar General (DG) and Pure Storage (PSTG) — as well as Dow Jones stocks Chevron (CVX) and UnitedHealth (UNH). Keep in mind that the now-struggling stock market rally is a reason for investors to play more defense.

Cheniere is an IBD Leaderboard stock. Pure Storage was featured in this week’s Stocks Near A Buy Zone column, along with three other top stock ideas. Pure Storage was also recently an IBD Stock Of The Day.

Dow Jones Today: Treasury Yields, Oil Prices

After Friday’s opening bell, the Dow Jones Industrial Average rose 1%, while the S&P 500 moved up 0.95%. The tech-heavy Nasdaq composite climbed 0.8% in morning action.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) traded up 0.8%, and the SPDR S&P 500 ETF (SPY) gained 1%.

The 10-year Treasury yield rose to 4.16% Friday morning after the jobs report. Meanwhile, U.S. oil prices traded up more than 4% and are at their highest level since mid-October. West Texas Intermediate futures are rising above support at their 50-day moving average, trading above $92 a barrel.

Stock Market Rally Struggles

On Thursday, the Dow Jones Industrial Average fell 0.5%, while the S&P 500 dropped 1.1%. The tech-heavy Nasdaq composite lost 1.7%, and the small-cap Russell 2000 declined 0.5%.

Thursday’s The Big Picture commented, “Since the Oct. 21 follow-through day, IBD has been recommending limited exposure (no more than 40%) due to this year’s market volatility and a pattern of failed follow-through days. And the recent action has validated that more cautious approach.”

Now is an important time to read IBD’s The Big Picture column. Following recent selling, investors should be more focused on playing defense than buying breakouts.

Five Dow Jones Stocks To Buy And Watch Now

Dow Jones Stocks To Buy And Watch: Merck, UnitedHealth

Dow Jones member and IBD 50 stock Merck is out of buy range past a double-bottom base’s 93.12 buy point, according to IBD MarketSmith pattern recognition. Merck shares inched lower Friday.

Health care giant UnitedHealth is trying to break out past a cup with handle’s 553.23 buy point, according to IBD MarketSmith. Shares inched higher Thursday, holding below their latest entry. UNH stock traded a fraction higher Friday morning.

4 Top Growth Stocks To Watch In The Current Stock Market Rally

Top Stocks To Watch: Arista, Cheniere, Dollar General, Pure Storage

IBD Leaderboard watchlist stock Arista Networks is approaching a buy point at 132.97 but could be adding a handle to its asymmetrical formation, which would lower the entry to 130.23. Shares jumped 8% after Piper Sandler upgraded the stock from neutral to overweight Friday morning.

IBD Leaderboard stock Cheniere Energy continues to hold just below a 178.69 buy point in a cup with handle. Look for a decisive retake of the entry before purchasing shares. LNG shares moved up 1% Friday.

Dollar General fell further below a 259.75 buy point in a cup base, as DG shares lost 0.2% Thursday, falling for a fourth straight day. Now, the stock will look for support around its 50-day line. DG shares were up 0.5% early Friday.

Recent IBD Stock Of The Day, Pure Storage, broke out Tuesday past a 31.62 buy point, but fell further below that entry during Thursday’s 1.45% decline. The stock was up 2% Friday.

Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live

Tesla Stock

Tesla stock inched higher Thursday, taking a breather after Thursday’s 5.6% skid. Shares are holding just above their recent lows, about 48% off their 52-week high and sharply below their 50- and 200-day moving average lines.

Shares of the EV giant moved up nearly 4% Friday morning.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares sold off another 4.2% Thursday, falling sharply for a fourth straight day. The stock is on pace to tumble nearly 11% this week. Apple stock traded up 1.9% Friday.

Microsoft fell 2.7% Thursday, hitting a new 52-week low. The software giant is about 39% off its 52-week high. Microsoft shares rose 1.5% Friday morning.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.

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