The Dow Jones Industrial Average veered lower Friday, as the price of Bitcoin tumbled below $22,000 and Bed Bath & Beyond (BBBY), BBBY stock, crashed.
BBBY stock fell sharply Thursday, after revived meme stock interest led shares to more than double in a steep, six-day advance. On Friday, shares crashed as much as 47% in premarket trade before paring losses to 42% in morning trade. GameStop (GME) Chairman Ryan Cohen’s RC Ventures disclosed it had sold its entire stake in the struggling retailer. In addition, Bed Bath & Beyond announced it had hired bankruptcy specialist Kirkland & Ellis to assist in managing its unwieldy debt load. The stock surged as much as 560% from a July 27 low of 4.54 to Wednesday’s high at 30.00.
Key earnings movers Friday include Applied Materials (AMAT), Deere (DE), Foot Locker (FL) and Ross Stores (ROST). AMAT shares fell 1%. Deere stock skidded 2.5%. Foot Locker soared 23%. And Ross Stores rose almost 1%.
In the current healthy stock market environment, Dow Jones stocks Coca-Cola (KO) and Merck (MRK) — as well as Albemarle (ALB), Arista Networks (ANET), Costco (COST) and Ollie’s Bargain Outlet (OLLI) — are among the top stocks to buy and watch.
Albemarle and Costco were featured in this week’s Stocks Near A Buy Zone column. Costco stock was added to IBD Leaderboard and SwingTrader in the wake of Tuesday’s breakout move. Albemarle was a recent IBD Stock Of The Day.
Dow Jones Today: Treasury Yields, Oil Prices, Bitcoin
Early Friday, the Dow Jones Industrial Average dropped 0.7%, while the S&P 500 moved down 1%. The Nasdaq composite traded down 1.5% in morning trade.
The 10-year Treasury yield ticked higher to 2.97% early Friday, following Thursday’s fall to 2.88%. The 10-year Treasury yield is rebounding after hitting its lowest level since early April in recent weeks.
Meanwhile, U.S. oil prices threatened to extend this week’s losses that dipped to their lowest level since January. West Texas Intermediate futures traded down more nearly 2%, below $89 a barrel.
The price of Bitcoin tumbled more than 9% over the last 24 hours, according to CoinDesk. Bitcoin traded around $21,300 in morning action Friday.
Stock Market Rally
On Thursday, the Dow Jones Industrial Average gained less than 0.1%, while the S&P 500 moved up 0.2%. The tech-heavy Nasdaq composite climbed 0.2% but remained below the 13,000 level and is still on pace to snap a four-week win streak. The small-cap Russell 2000 rallied 0.7%.
The next few sessions will likely be key for the stock market trend, as the Nasdaq and Dow Jones industrials test support levels. Meanwhile, the S&P 500 is butting its head up against its 200-day line, which is a key resistance level to watch.
Thursday’s The Big Picture column commented, “If the stock market is trading sideways, then most leading stocks will also be consolidating. These periods of rest can result in handles on cup, saucer and double-bottom patterns, or even new bases, which provide new buy points.”
If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one key to the investment guidelines. IBD offers a broad range of growth stock lists, such as Leaderboard and SwingTrader.
Dow Jones Stocks To Watch: Coca-Cola, Merck
Dow Jones soda giant Coca-Cola is building a flat base that has a 67.30 buy point. A handle entry at 65.14 is also in play. Shares are rebounding from their 50-day line and trying to top the handle entry. The stock fell 0.1% early Friday.
Merck also is building a flat base, a pattern that shows a 95.82 buy point. Shares are trying to hold above their 50-day line, according to IBD MarketSmith chart analysis. Merck shares rose 0.6% Friday.
MRK stock shows a solid 94 out of a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. Investors can use the IBD Composite Rating to easily gauge the quality of a stock’s fundamental and technical metrics.
Top Stocks To Watch: Albemarle, Arista, Costco, Ollie’s
Lithium producer Albemarle remains in buy range following Friday’s breakout past a 273.78 buy point in a large cup-with-handle base. The 5% buy zone goes up to 287.47. Earlier last week, shares topped a smaller cup with handle with a 250.25 buy point. Shares moved up 0.7% Thursday, ending a two-day skid. The stock was down 1.7% Friday morning.
Arista Networks, one of this week’s IBD 50 Stocks To Watch picks, continues to plod up the right side of a double-bottom base that offers a 143.67 buy point. With the stock about 8% away from the current entry, look for a handle to offer a more risk-optimal buy point. Arista’s RS line has been trending higher and is approaching a new high. ANET shares declined 2% Friday.
IBD Leaderboard stock Costco is breaking out past a cup with handle with a 552.81 buy point. The stock rose 0.8% Thursday, moving higher in the 5% buy area. Shares dropped 0.7% early Friday.
Ollie’s Bargain Outlet is rebounding from its 10-week line — a critical support level — placing the top discount retailer in a new buy zone. Shares are also carving a handle after a large cup base, putting the latest buy point at 72.37. Current price action is about 11% away from that entry. Shares fell 0.5% Friday morning.
Tesla stock lost 0.4% Thursday, extending a losing streak to three sessions. Shares of the EV giant declined 2% Friday morning.
This week, the stock closed at its highest level since May 4. Shares are trying to again decisively rise above resistance around their 200-day line. Tesla is about 27% off its 52-week high. Its 3-for-1 stock split is set for Aug. 24.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares rallied 0.9% Thursday, as the stock continues to build the right side of a cup base that has a 179.71 buy point. Another interpretation could be a large double bottom that spans back to January. Either way, the buy point is identical. Keep an eye out for a potential handle to form and offer a lower entry.
Bullishly, the stock’s relative strength line is already at new highs, indicating big stock market outperformance. Shares dropped 0.4% Friday morning.
Microsoft fell 0.4% Thursday, moving further away from its long-term 200-day line. The stock lost 0.5% early Friday.
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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