Dow Jones Recovers 300 Points For Powell Comments; Boeing and Disney Shares Soar

Key market indices reversed higher at noon on Wednesday as the Dow Jones Industrial Average went from a loss of 100 points to a gain of 300 points.


Dow Jones industrials were up 0.7%, the S&P 500 was up 0.6% and the Nasdaq was up 0.3% on the stock market today. The small cap followed by the Russell 2000, up 1.9%, outperformed. Volume was lower on the two major exchanges compared to the same time on Tuesday.

Stocks rose when Federal Reserve Chairman Jerome Powell reiterated his comments Tuesday that inflation and employment remain well below the central bank’s targets. That means the Fed is likely to continue buying bonds to boost the US economy.

Tech stocks propelled the Nasdaq to a 43.6% gain in 2020 for its fifth-best year in history. The S&P 500 was up 16.3% and the Dow 7.2% last year. Read The Big Picture for a detailed daily market analysis.

Covid-19 update

The Covid-19 pandemic continues to shake the US economy, as nationwide lockdowns approach the one-year mark. But there are signs of hope as vaccines are rolled out and cases begin to decline in some states.

Overview of the US Stock Market

Index Symbol Price gain loss % Change
Dow Jones (0DJIA) 31799.61 +262.26 +0.83
S&P 500 (0S and P5) 3906.61 +25.24 +0.65
Nasdaq (0NDQC) 13515.25 +50.05 +0.37
Russell 2000 (IWM) 226.53 +4.77 +2.15
IBD 50 (FFTY) 46.52 -0.01 -0.02
Last Updated: 12:02 PM ET 2/24/2021

Cumulative Covid-19 cases worldwide have exceeded 112.8 million with nearly 2.5 million deaths, according to Worldometer. In the US, cases are now approaching 29 million with more than 515,000 deaths, although the number of new cases in the US has dropped dramatically in recent weeks.

As countries rush to administer Covid-19 vaccines, Johnson and Johnson (JNJ) rose 1.3%, on course to halt a three-day slide. The stock found support at its 50-day moving average on Tuesday and is back in the buying range from a buy point of 155.57 from a flat base. The buy range goes up to 163.35.

An FDA advisory panel will meet Friday to evaluate the vaccine and submit a recommendation to the Food and Drug Administration. J&J said the FDA found its vaccine to be 66% effective in protecting against Covid-19 infections and 88% effective in preventing severe cases.

Dow winners and losers

Boeing (BA), with a 5% increase in rapid turnover, led the Dow. Stocks are building the right side of a 12-week consolidation, according to MarketSmith’s chart analysis. Boeing shares are approximately 9% off a purchase point of 244.18. But a composite rating of 4 and an earnings per share rating are pretty weak.

The Federal Aviation Administration requires engine inspections before Boeing 777s equipped with a certain Pratt & Whitney engine can fly again. On Saturday, a Boeing 777 and 747 experienced airborne engine fires, sending debris to the ground.

Among other blue chip winners, Caterpillar (CAT), Dow Inc. (DOW), Chevron (CLC) and Goldman sachs (GS) earned more than 2% each.

Disney (DIS) added 1.5% in heavy volume to a new record, on course to extend its winning streak to four. Disney shares range from a buy point of 183.50 from a flat base. The buy zone reached a high of 192.68.

But House deposit (HD) stumbled over 4% in heavy trading. On Tuesday, the shares lost 3%, despite the home improvement retailer reporting better-than-expected fourth-quarter results before the market opened. It did not provide a perspective.

Home Depot stock has been working flat with a buy point of 293.05, although it has now given up its 200-day moving average line.

Outside the Dow

Oil and gas, automakers and airlines led the rise among IBD’s 197 industry groups. But software, utilities, and online retailers and others lagged behind.

Square (SQ) slumped 8% in strong trading early Wednesday, before cutting its loss to 5%. Stocks, on course for a third consecutive decline, found support at the 50-day line. The point-of-sale payments company reported strong earnings in the fourth quarter, but gross revenue and payment volume did not meet Wall Street targets. Square also revealed a new investment of $ 170 million in Bitcoin.

Bitcoin rallied 4% early Wednesday, briefly climbing above $ 51,000 before reducing gains. The price of Bitcoin is trading around $ 49,600 at midday trading, according to CoinDesk. Bitcoin peaked at $ 58,332 on Sunday and fell below $ 45,000 on Tuesday, before recovering.

Grayscale Bitcoin Trust (GBTC) rallied 6% on Wednesday, after two days of declines.

Follow Nancy Gondo on Twitter at @IBD_NGondo


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