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Dow Jones Drops 200 Points As Disney Weighs; Tech Stocks Drag Nasdaq; Bitcoin Dives | Investor’s Business Daily %

Stocks extended last week’s losses as the Dow Jones Industrial Average tumbled nearly 200 points and tech stocks again pressured the Nasdaq.




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The Nasdaq was down 0.9%, the S&P 500 fell 0.6% and the Dow Jones industrials gave up 0.5% in the stock market today. Small caps tracked by the Russell 2000 dipped 0.7%. Volume was mixed, higher on the NYSE but lower on the Nasdaq, vs. the same time Friday.

Tech stocks, hit hard recently, headed south again. On May 10, the Nasdaq tumbled 2.6% to close below its 50-day moving average for the first time since March.

Last year, tech stocks boosted the Nasdaq to a 43.6% gain — its fifth-best year ever. The S&P 500 rose 16.3% in 2020 and the Dow added 7.2%. After a strong start this year and a short correction, the market has rebounded near record highs. Read The Big Picture for more detailed daily market analysis.

The U.S. economy is recovering from the Covid-19 pandemic, which triggered nationwide lockdowns over a year ago. But many states are relaxing restrictions, and cases are plateauing or declining in some states as vaccinations roll out.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 34201.72 -180.41 -0.52
S&P 500 (0S&P5) 4149.44 -24.41 -0.58
Nasdaq (0NDQC ) 13306.34 -123.64 -0.92
Russell 2000 (IWM) 219.30 -1.55 -0.70
IBD 50 (FFTY) 44.17 -0.45 -1.01
Last Update: 12:10 PM ET 5/17/2021

Cumulative Covid-19 cases worldwide are approaching 164 million, with more than 3 million deaths, according to Worldometer. In the U.S., cases have topped 33.7 million with over 600,000 deaths, although the number of new cases and deaths in the U.S. has slowed dramatically in many states.

Dow Losers And Winners

Disney (DIS) fell 2.4% in heavy volume, extending Friday’s 2.6% drop. Shares tumbled Friday, after the theme parks and media giant reported mixed fiscal Q2 results late Thursday. Earnings beat, sales missed and streaming subscriber growth fell short of some analyst forecasts.

Disney stock had been working on a new flat base with a 203.12 buy point. But the recent slide breached the bottom of the base. At nearly 17% off the left-side high, the flat-base pattern is no longer valid.

Home Depot (HD) fell 2.2% to test its 10-week moving average. If the stock finds support and rebounds off the line, that could set up a chance to buy or add shares. Analysts expect the home improvement retailer to earn $3.08 a share on revenue of $34.7 billion when it reports early Tuesday. Home Depot stock is about 9% off its high.

Among other blue chip losers, Microsoft (MSFT), Salesforce.com (CRM) and Apple (AAPL) gave up about 1.5% each.

Microsoft has pulled back below a 246.23 buy point of a flat base, according to MarketSmith chart analysis. If it retakes the entry, the buy range would go up to 258.54. Microsoft is an IBD Leaderboard and IBD Long-Term Leader stock.

Apple is trying to hold its 50-day line, after triggering the 7%-8% loss-cutting sell rule last week from a 135.63 buy point. The stock continues to work on a four-month consolidation with a 145.19 buy point, according to its weekly MarketSmith chart.

But some health care plays advanced. Pharma giant Merck (MRK) rose 1.7%, while drugstore chain Walgreens Boots Alliance (WBA) and biotech Amgen (AMGN) added a respective 0.7% and 0.5%.

Outside The Dow

Software, solar, chip equipment and travel bookers led the downside among IBD’s 197 industry groups. Gold miners, steel and internet retailers bucked the decline.

In the internet retail group, Amazon (AMZN) gained 1.3% to retake its 50-day line. It’s on track for a third straight advance. The e-commerce giant has a best possible 99 Earnings Per Share Rating. But its 37 Relative Strength Rating means Amazon’s performance trails 63% of all other stocks.

Bitcoin plunged to as low as $42,212 early Monday, before paring losses. It was around $43,329 midday, according to Coindesk. Over the weekend, Tesla CEO Elon Musk implied in a tweet that Tesla might have sold or will sell its remaining Bitcoin. Early Monday, he tweeted: “To clarify speculation, Tesla has not sold any Bitcoin.”

Grayscale Bitcoin Trust (GBTC), which tracks the price of Bitcoin, dived about 10% Monday. Its on pace for its lowest close in over three months.

The Innovator IBD 50 ETF (FFTY) gave up 0.6% as losses from MarineMax (HZO), Floor & Decor (FND) and Yeti (YETI) offset a 5% gain from Cleveland-Cliffs (CLF).

Follow Nancy Gondo on Twitter at @IBD_NGondo

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