The Dow Jones Industrial Average briefly fell more than 50 points Thursday on the last day of 2020. Apple stock remains within striking distance of its new buy point, while Tesla hit more record highs. Baidu hit new highs before reversing lower, while Nio briefly jumped 4%.
Tesla (TSLA) hit another record high Thursday, rising more than 3%. Chinese rival Nio (NIO) briefly jumped almost 4%, adding to this week’s rebound from a critical support level. Meanwhile, Baidu (BIDU) reversed its sharp early gains.
Dow Jones Today
On Thursday, the Dow Jones Industrial Average eased 0.1%, while the S&P 500 traded essentially flat. The tech-heavy Nasdaq composite moved down 0.1% in midday trade.
Among exchange traded funds, Innovator IBD 50 (FFTY) traded 0.3% lower Thursday. The Nasdaq 100-linked Invesco QQQ Trust ETF (QQQ) moved down less than 0.1%. Meanwhile, the SPDR S&P 500 ETF (SPY) lost a fraction.
U.S. Stock Market Today Overview
Last Update: 10:40 AM ET 12/31/2020
Amid the coronavirus stock market rally, the tech-heavy Nasdaq is up 43.4% for the year through Wednesday’s close. The S&P 500 is up 15.5%, while the DJIA is up 6.6% year to date.
According to the Worldometer data tracker, the cumulative number of confirmed coronavirus cases in the U.S. topped 20.2 million on Thursday. Total virus-related deaths rose past 350,000.
The cumulative total of worldwide Covid-19 cases confirmed since the start of the outbreak topped 83.2 million Thursday, with more than 1.8 million virus-related deaths.
Coronavirus Stock Market Rally
November was a key month for the stock market. IBD’s The Big Picture flagged a new uptrend following the market’s bullish follow-through day on Nov. 4. Meanwhile, the end of December sees the stock market at record highs.
Wednesday’s Big Picture commented, “The Nasdaq, S&P 500 and Dow industrials all traced such a narrow range of trading that their intraday highs and lows came inside their respective highs and lows of the prior day. In chart parlance, we call that an inside days.”
Investors should continue to use the stock market’s strength to buy breakouts. Be patient and wait for powerful breakouts instead of chasing extended stocks. If the new breakouts work, then add more exposure. But if breakouts start to fail, then you can back away.
In particular, focus on stocks with strong relative strength. Find them by using the relative strength line. The RS line measures a stock’s price performance vs. the S&P 500. If the stock is outperforming the broader market, then the RS line angles upward. If a stock is performing worse than the broad market, then the line will point lower.
Stocks To Watch: IBD Long-Term Leaders
Stocks to watch include IBD Long-Term Leaders, companies with stable earnings growth and price performance. Veeva Systems (VEEV) is the latest addition to the list, as it tries to regain its 10-week line. Shares are approaching a 314.09 buy point in a cup base.
Dow Jones Stocks To Watch: Visa Breaks Out
Wednesday’s IBD Stock Of The Day, Visa, is in the 5% buy zone past a 217.75 buy point in a flat base, according to IBD MarketSmith chart analysis. Shares broke out on Wednesday amid a nearly 2% rise. Visa moved up 0.5% Thursday morning. The buy zone goes up to 228.64
Visa is the No. 11-performing Dow Jones stock for 2020, with a 16.2% advance through Wednesday.
Stocks In Or Near Buy Zones: Five Below, Intuitive Surgical, Epam
Shares dropped 0.5% Thursday.
Robotic surgery leader Intuitive Surgical remains in the 5% buy zone above a 792.64 entry point in a flat base following a Dec. 22 breakout, according to IBD MarketSmith chart analysis. The 5% buy zone goes up to 832.27. Shares reversed and rose 0.5% early Thursday.
Bullishly, the stock’s RS line hit a new high on the breakout day, confirming the strength of the breakout.
Thursday’s IBD Stock Of The Day, Epam Systems, looked to reclaim a 357.08 buy point in a flat base. Shares fell 0.4% Thursday and are just below the buy point.
According to IBD Stock Checkup, EPAM stock shows a 95 out of a perfect 99 IBD Composite Rating. The Composite Rating — an easy way to identify top growth stocks — is a blend of key fundamental and technical metrics to help investors gauge a stock’s strengths.
Chinese internet giant Baidu reversed from sharp gains to fall 1.6% in morning trade Thursday, on pace to ease from Wednesday’s 12.6% surge. The stock is on pace to snap a three-day win streak.
Shares are sharply extended from a 135.54 buy point in a cup with handle and a recent test of the 50-day support level. The stock has been on a tear since reports that the company is considering electric car production.
Tesla rival Nio continued to rebound from its 50-day support level, moving up 2.5% and looking to extend a win streak to three sessions.
Shares remain about 15% off their 52-week high, as a new base continues to take shape.
IBD Leaderboard stock Tesla hit a record high on Thursday morning, rising more than 3%. Midday Thursday, Tesla stock hit a record high at 717.10.
On Nov. 18, shares broke out above a 466 buy point in a cup with handle and are more than 45% from the buy point.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple stock is trying to break out above a cup base’s 138.08 buy point, according to MarketSmith chart analysis. Shares briefly hit the new buy point on Tuesday before reversing lower. Shares are just under the new buy point amid Thursday’s 0.5% loss.
In recent weeks, Apple shares have moved above aggressive entries at 125.49 and 122.09.
Apple is an IBD Leaderboard stock. Per Leaderboard commentary, “The alternate entry is in the lower half of the base but the RS line is improving. Apple nearly doubled from its breakout in April and it will be tough to replicate that run. The base is third stage, which is a reason to have lower expectations this time around.”
The blue-chip giant is the No. 1-performing Dow Jones stock for 2020, with an 82.2% advance through Wednesday.
Software giant Microsoft moved down 0.3% Thursday, as shares continue to approach a 228.22 buy point.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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