Dow Jones Lower While Bitcoin Tumbles; BBBY Stock Crashes

The Dow Jones Industrial Average, Nasdaq composite and S&P 500 all opened lower Friday morning. The Nasdaq is on track to break its four-week winning streak while the Dow and S&P could still end the week today. It’s Ali Coram and Ed Carson here with a breakdown second of 15 secondsVolume 0% 

Dow Jones Down Less Than Other Indexes

Dow Jones fared best after the weak open, trading 0.9% lower.

Meanwhile, the S&P 500 held a loss of over 1.3%. Small caps also sold off, dropping the Russell 2000 2.1%. The Nasdaq composite is trading lower by 2%.

Volume was lower on the Nasdaq and higher on the NYSE vs. the same time on Thursday.

Elsewhere, oil prices rose 1.6% to $91.92 per barrel after slipping below $90 midweek.

One key reason the market is falling is a rise in Treasury yields. The 10-year yield rose 10 basis points to 2.99% Friday morning.

This is an important week because indexes have slowed their rise after several weeks of strong gains.

All major benchmarks now face important tests around their 200-day moving averages. The Dow Jones has successfully regained this zone while the S&P 500 is trading just below.

U.S. Stock Market Today Overview
IndexSymbolPriceGain/Loss% Change
Dow Jones(0DJIA)33714.10-284.94-0.84
S&P 500(0S&P5)4229.85-53.89-1.26
Nasdaq(0NDQC )12708.73-256.61-1.98
Russell 2000(IWM)194.85-4.07-2.05
IBD 50(FFTY)28.91-0.68-2.30
Last Update: 12:08 PM ET 8/19/2022

The Nasdaq remains slightly below its 200-day line and is on track to post its first weekly loss in over a month.

It will be bullish for the market uptrend if all major indexes retake their 200-day lines.

On Aug. 26, Federal Reserve Chairman Jerome Powell delivers his annual address at the global central banking conference in Jackson Hole, Wyo. The highly anticipated speech could signal if borrowing costs will continue to rise and how long they’ll stay heightened to bring down record inflation.

Bitcoin Stumbles

Bitcoin is trading lower by 7.5% after hitting resistance and reversing at 50-day moving average, following a monthlong test. It traded near $21,500 Friday afternoon.

The premier cryptocurrency broke down from support in November 2021 and failed four recovery attempts before adding a fifth overnight. Weekly relative strength indicators are rolling over in reaction to the breakdown, raising odds for a test of June’s 20-month low at $17,593.

A reminder: Bitcoin trades 24-hours a day through the weekend, so further price developments are possible this week.

Inside The Dow Jones

Merck (MRK) led the upside among Dow Jones components early Friday. The drugmaker gained around 1% and moved closer to a 95.82 flat-base entry. Shares remain just 4% below the buy point after retaking their 50-day moving average last week.

Health care leader UnitedHealth Group (UNH) also led the upside among blue chips, gaining 0.8%. UNH stock is now extended from a cup-with-handle base with a 518.80 buy point.

On the downside, (CRM) underperformed, posting a 3% loss.

Earnings Movers: Nvidia, Foot Locker

On Friday, Nvidia (NVDA) fell 4.5% as shares slid ahead of next week’s earnings. The firm is expected to report Q2 earnings of 49 cents per share on $6.7 billion revenue.

The chipmaker recently reclaimed support at its 50-day moving average but remains below its 200-day line.

Chip equipment stock Applied Materials (AMAT) reported earnings late Thursday, beating expectations on both top and bottom lines.

Shares have reversed an early uptick and are down 3.4%. The firm reported EPS of $1.94 on revenue of $6.52 billion.

Foot Locker (FL) popped over 21% on strong earnings. The firm’s second-quarter bottom line results blew past estimates, with EPS of $1.10 per share vs. the expected 80 cents. Revenue slightly missed expectations, coming in at $2.06 billion.

The stock gapped up in heavy volume and reclaimed support at its 200-day moving average.

Meme Stock Bed Bath & Beyond Collapses

Bed Bath & Beyond (BBBY) shares more than doubled before hitting 30 on Aug. 17. Shares tumbled 19% on Thursday and have fallen another 40% this morning.

GameStop (GME) Chairman Ryan Cohen’s RC Ventures disclosed it had sold its entire BBBY stake. In addition, Bed Bath & Beyond announced it had hired a bankruptcy specialist to assist in managing its unwieldy debt load. The stock surged 560% from a July 27 low of 4.54 to Wednesday’s high at 30.

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