Dow Jones Slips From Record High As McConnell Faces Stimulus Checks Pressure; Apple Stock Passes Buy Point

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The Dow Jones Industrial Average hit a new high, but reversed lower in a mixed session as pressure increased on Senate Majority Leader Mitch McConnell to make a decision on a proposal for bigger stimulus checks.




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Meanwhile Leaderboard stock Apple (AAPL) passed a new buy point, while Boeing (BA) was the best performing blue chip as the 737 Max returned to the skies. Among electric-vehicle stocks, Tesla (TSLA) slipped as rivals Nio (NIO) and Nikola (NKLA) rallied.

While President Donald Trump ended up signing the new $900 billion coronavirus stimulus bill, he had threatened to veto it because he found the $600 one-time checks to individuals to be insufficient. He called for $2,000 checks, and the House of Representatives Monday voted to pass a bill to achieve this. Republican leader McConnell has yet to make any public commitments on the measure, while Senate Minority Leader Chuck Schumer is expected to ask for unanimous consent to pass the measure.

Meantime, Covid-19 cases continue to rise. In the U.S., confirmed total coronavirus cases are closing in on the 20 million mark, with a death toll near 350,000, according to Worldometer. Global cumulative coronavirus cases now sit near the 82 million mark, with almost 1.8 million deaths.

S&P 500 Rises, Nasdaq Reverses

The S&P 500 was the best performing major index as it managed to turn in a gain of around 0.2%. Medical devices firm Abiomed (ABMD) was the standout performer after turning in a gain of around 4.5%.

The Nasdaq reversed lower after opening positive. However, it managed to bounce from its lows, and was down 0.2%. Pinduoduo (PDD) was the day’s star performer with a gain of almost 13%. At-home exercise stock Peloton Interactive (PTON) was down more than 2%.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 30403.84 -0.13 +0.00
S&P 500 (0S&P5) 3739.04 +3.68 +0.10
Nasdaq (0NDQC ) 12870.16 -29.26 -0.23
Russell 2000 (IWM) 194.61 -3.66 -1.85
IBD 50 (FFTY) 40.38 -0.49 -1.20
Last Update: 12:00 PM ET 12/29/2020

Volume was lower compared with the same time on Monday. Trading fell around 5.5% on the NYSE, and by more than 9% on the Nasdaq.

Small caps were underperforming the major indexes, with the Russell 2000 falling by around 1.7%.

It was a mixed day for sectors, with slightly more winners than losers. Health and materials were the best performing sectors.

Growth stock were pressured lower after initially opening in the green. The Innovator IBD 50 ETF (FFTY) lost around 0.9%. The best performing stocks on the IBD 50 were Futu (FUTU), which rose 2.5%, and computing peripherals maker Logitech (LOGI), which gained more than 2%.

Boeing Stock Takes Off As Dow Jones Falls

The Dow hit a record high before the downward pressure saw it sucked lower. However it was down less than 0.1%.

Boeing was one of the best performing components, rising by around 1%. The Boeing 737 Max returned to commercial service in the U.S. after a 20-month grounding. The Boeing 737 Max was grounded following two deadly crashes. Boeing stock is back below a 234.30 buy point of a base within a larger consolidation.

The index’s top performer was Amgen (AMGN), which turned in a gain of around 1.7%. Dow laggards included Salesforce.com (CRM), which ceded more than 2.5%, and Home Depot (HD).

Apple Stock Breaks Out

Another notable Dow Jones stock making a move was computing giant Apple. The stock rose above a cup base’s 138.08 buy point, MarketSmith analysis shows. However it has slipped back just below the buy point.

Apple stock has an IBD Composite Rating of 88. In recent weeks, Apple shares have moved above aggressive entries at 125.49 and 122.09. It is the No. 1-performing Dow Jones stock for 2020, with an 86.2% advance through Monday.

Tesla Stock Reverses As Rivals Accelerate

Newly minted S&P 500 member Tesla pared some losses, but was still down around 0.5%.

The IBD Leaderboard stock is just off record highs, but remains extended from a 466 buy point after breaking out of a cup-with-handle base. Tesla still has a best-possible IBD Composite Rating of 99. Tesla stock is up almost 700% so far in 2020.

Tesla stock is approaching a key year, CFRA Research senior analyst Nelson Garrett told IBD.

“It’s about execution in 2021 for Tesla. Big things for them are completion of the two factories under construction — one in Germany and the other in Texas,” he said. They’re operating on a very aggressive timeline to complete construction and have first vehicle productions at both of those factories in 2021. If they accomplish that, it will be a very impressive feat.”

Tesla was left in the shade of Chinese rival Nio, which made a stout gain of more than 2%. It looks set to end a four day losing streak that saw it test its 50-day moving average. It remains well shy of its Nov. 24 high of 57.20.

Nikola stock, which has been battered after a flurry of bad news, was up a measly 0.1%.

Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.

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