Dow Jones falls after key inflation data; Fed decision, Powell comments later today

The Dow Jones Industrial Average fell on Wednesday after more key inflation data and the release of the producer price index. Later today, the two-day Federal Reserve meeting will conclude with a rate decision followed by comments from Fed Chair Jerome Powell. Finally, Tesla stock fell after the company slightly raised the price of its Model Y electric vehicle in the US


The producer price index – a measure of the prices producers receive for their goods – fell 0.3% month-on-month, below estimates. Year-on-year, wholesale inflation slowed to 1.1% from 2.3%, also below expectations. Core PPI inflation eased to 2.8%. It was expected to fall from 3.2% to 2.9%.

The Fed is widely expected to refrain from raising rates at its two-day monetary policy meeting, which concludes at 2pm ET on Wednesday. The move would put the ten consecutive rate hikes that began in March last year on hold.

However, Wall Street also expects policymakers to signal their intent to hike rates again barring a significant slowdown in labor and core services inflation. How hawkish the Fed's signals are today will likely determine how the S&P 500 reacts.

stock market today

modern micro devices (AMD) up 1.8%, according to Reuters reports Amazon (AMZN) is considering AMD's latest AI chip for its AWS cloud computing business.

EV giant Tesla (TSLA), which is now up for 13 straight days, was down 0.6% on Wednesday morning. Dow Jones tech giants Apple (AAPL) and Microsoft (MSFT) were mixed after the market open today.

Dexcom (DXCM), floor & decor (FND), Kinsale Capital (KNSL) and Churchill Downs (CHDN) – as well as Dow Jones shares Cisco systems (CSCO), JPMorgan Chase (JPM) and Foreclosure (CRM) – are among the best stocks to buy or watch when the stock market is up.

Tesla is an IBD leaderboard stock, while Floor & Decor was the IBD stock of the day on Thursday. Churchill Downs was featured in this week's Stocks Near A Buy Zone story.

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Dow Jones today: oil prices, government bond yields

After Wednesday's opening bell, the Dow Jones Industrial Average fell 0.5%, a drag UnitedHealth Group (UNH) fell nearly 8%. The health insurer warned of an increase in medical costs in the second quarter at Goldman Sachs' healthcare conference.

The S&P 500 gained 0.1% while the tech-heavy Nasdaq Composite fell in morning action.

Among U.S. exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) was down less than 0.1%, while the SPDR S&P 500 ETF (SPY) was up 0.1% early Wednesday.

After the PPI inflation data but ahead of the Fed's decision, the US 10-year Treasury yield fell to 3.78% on Wednesday. On Tuesday, the 10-year yield closed at its highest level since March 9th.

Oil prices rose in early Wednesday trade after recovering from recent lows on Tuesday. West Texas Intermediate futures were up more than 1% on Wednesday, climbing back above $70 a barrel. Energy Information Administration weekly inventory data is released at 10:30 am

stock market action

On Tuesday, the Dow Jones Industrial Average was up 0.4%. The S&P 500 gained 0.7%, while the tech-heavy Nasdaq Composite gained 0.8% to set a new high for 2023.

Tuesday's Big Picture column said: “As for the Nasdaq, well, the index's longest losing streak since May 5 lasted two sessions. The index closed 9% above its 50-day moving average and breached an upper channel line, increasing the likelihood of a pullback. Invesco QQQ Trust (QQQ) closed 10.1% above its 50-day moving average. This is above the 6% to 7% level that has historically signaled pullbacks for the Nasdaq 100.”

Now is an important time to read IBD's The Big Picture column given the recent positive shift in the market outlook.

The five best Dow Jones stocks to buy and watch right now

Dow Jones stocks to buy and watch: Cisco, JPMorgan, Salesforce

Dow Jones networking giant Cisco Systems breaks out of a cup and handle buy point of 50.58 and is up 0.6% on Tuesday. CSCO shares rose 0.1% on Wednesday.

Dow Jones banking leader JPMorgan is approaching a flat base buy point of 143.37 after a five day winning streak. Stocks are only 2% away from their last buy point. JPM shares gained 0.4% early Wednesday.

According to the IBD leaderboard analysis, Salesforce has surpassed the alternative entries at 193.91 and 200.00 for the past few weeks. For the past few weeks, shares have reached 20% gains from an entry at 178.94 cups with handles and are now attempting to recover from support at the 10-week moving average. CRM stock fell 0.9% on Wednesday morning.

4 top growth stocks to buy and watch in the stock market rally

Top stocks to buy and watch: Dexcom, Floor & Decor, Churchill Downs

According to pattern recognition by IBD MarketSmith, Dexcom gave up the 126.44 buy point on a flat basis down 0.8% on Tuesday. The 5% buy area will rise to 132.76 as the stock recaptures entry. DXCM shares rose 0.2% on Wednesday.

IBD SwingTrader stock Floor & Decor recaptured its 50-day moving average during last week's gains, placing the flooring retailer in a new buy zone. FND stock is only 3% off a traditional buy point at 101.39. Shares were up 0.1% early Wednesday.

Insurance leader Kinsale Capital closed in the 5% buy zone above a 345.75 buy point on Tuesday, up 1.1% in the session. The buy zone extends to 363.04. KNSL shares fell 0.7% on Wednesday morning.

Last week, IBD Leaderboard Watchlist stock Churchill Downs found support around its 50-day moving average and triggered a bullish signal with an alternative entry at 139. However, the stock is still close to this level as it is also forming a flat base with a buy point of 150.45. Shares fell 0.6% early Wednesday.

Learn how to drive the market with IBD's ETF market strategy

The best stocks to buy and watch as the stock market rallies

These are the top four stocks to buy and keep an eye on in today's stock market, including a Dow Jones leader.

Company Name symbol Right buying point Type of purchase point
ASML (ASML) 683.18 Cup with handle
Foreclosure (CRM) 200.00 consolidation
cloud flare (NETWORK) 66.20 Double bottom
Fortinet (FTNT) 69.07 flat base
Source: IBD data as of June 12, 2023

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

Tesla stock

IBD leaderboard stock Tesla gained 3.55% on Tuesday, hitting a new 2023 high and continuing above the buy point of a double bottom base of 207.79. Shares closed 18% below their 52-week high on Tuesday.

TSLA stock threatened to end its long winning streak for good, falling 0.6% on Wednesday morning.

Dow Jones leaders: Apple, Microsoft

Among Dow Jones stocks, Apple stock ended a three-day winning streak and fell 0.3% on Tuesday after an analyst downgrade. The stock hit an all-time high of 184.95 last week and is just below that level. The stock continues to hold well above a buy point of 157.38. Early Wednesday, AAPL shares fell 0.1%.

Microsoft shares were up 0.7% on Tuesday, rebounding for a fourth straight session and once again getting close to their 2023 highs. MSFT stock continues to trade from a flat base buy point of 276.76 in the Profit-taking zone of 20-25%, allowing investors to take at least part of the profits. And on Wednesday morning, Microsoft shares were up 0.2%.

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


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