Stocks rallied at the starting bell Thursday, as a solid premarket trade received an added boost from positive jobless claims and retails sales data. Earnings season gathered steam, with Taiwan Semiconductor, Bank of America, Citigroup and Delta Air Lines reporting. Coinbase Global opened sharply higher in its second day of trade. And UnitedHealth surged highest among Dow Jones stocks following its first-quarter report.
The Nasdaq Composite set up a strong early pace, rising 1.1% at the starting bell. The Dow Jones Industrial Average and S&P 500 each swung 0.6% higher, sending both benchmarks to new record highs on the stock market today.
Chips were in motion as IBD Leaderboard stock Nvidia (NVDA) surged 4% to lead the both the S&P 500 and the Nasdaq 100. Raymond James upgraded Nvidia to strong buy from outperform. The gain sent Nvidia stock into a buy range above a 615 cup base buy point.
The VanEck Vectors Semiconductor ETF (SMH) climbed 0.4% in early trade.
GlaxoSmithKline (GSK) led an early rally among pharma stocks, popping 5.4% on news that Elliott Management had taken a large stake in the company.
On the earnings front, Taiwan Semiconductor (TSM) reversed premarket gains and dropped 1.9% and Bank Of America (BAC) slumped 2.8%, while Citigroup (C) muscled 1% higher after reporting quarterly results. Delta Air Lines (DAL) dumped 2.5% following a mixed first-quarter report.
Dell Technologies (DELL) jetted 4.5% higher after announcing it would spin off its 82% stake in virtualization software innovator VMware. The spin-off is expected to occur in the fourth quarter. VMware (VMW) shares slipped a fraction.
Dow Jones Stocks: UnitedHealth, Apple, Goldman Rise
UnitedHealth Group (UNH) powered 3.6% higher claim a strong early lead among Dow Jones stocks. Apple (AAPL) plowed 2.1% higher, possibly buoyed by the strong first-quarter earnings report from Taiwan Semi.
UnitedHealth earnings soared 43% in the first quarter, over a 9% increase in revenue. Both numbers easily cleared analyst targets. UnitedHealth substantially raised prior guidance for full-year 2021 earnings, and said medical costs as a percentage of premiums remained in check, with its medical care ratio dipping to 80.9% from 81% a year ago.
UnitedHealth stock is in a buy range above a flat-base buy point at 386.05. The buy range runs to 386.45.
Dow Jones peer Goldman Sachs (GS) added 0.2% early Thursday, and remains in a buy zone on a rebound from support at its 10-week moving average. Goldman shares ended with a 2.3% advance Wednesday, following the bank's first-quarter earnings report. Goldman was IBD's Stock of the Day on Wednesday.
Freeport, Sibanye, Cleveland Cliffs Climb
Miners were also once again in motion as commodities prices rose. Freeport-McMoRan (FCX) trimmed its premarket gain to 0.3% at the open, lifting the copper and ore miner closer to a double-base buy point at 37.71. Gold miner Sibanye Stillwater (SBSW) traded high on the IBD 50 list, up more than 3%, and leaning toward a 20.50 buy point in what IBD MarketSmith analysis charts as an eight-week consolidation.
Steelmaker/ore miner Cleveland Cliffs (CLF) reversed its premarket gain and dropped 0.8% in early action. The IBD 50 stock is just below an 18.81 proper buy point, and in a buy range above an alternative, early entry at 18.06.
Econ Data: Jobless Caims Dive, Retail Sales Soar
A big day for economic data kicked off with the Labor Department reporting that first-time applications for unemployment claims dropped to 576,000 in the week ended April 10, the lowest number in more than a year. It was a massive 22% drop from the prior week's 744,000 claims, and far below the 695,000 new filings projected by economists.
Continuing claims came in at 3.731 million, above the projected 3.7 million claims, and slightly higher than the prior week's average of 3.727 million.
In addition, retail sales soared 9.8% in March, according to the Commerce Department, up from February's 3% decline and well above the economist targets for a 5.6% gain. Minus vehicles and gas, sales rose 8.2% vs. February's 3.3% drop, and against expectations for a 4.4% gain.
Manufacturing surveys from the Philadelphia and New York Federal Reserve banks came in much stronger than expected. And the Federal Reserve reported March industrial production increased 1.4%, vs. a 2.2% decline in February, but well below forecasts for a 2.8% rise.
At 10 a.m. ET, business inventories roll out from the Commerce Department, along with the National Association of Home Builders' confidence survey for April.
Bitcoin Pulls Back After Coinbase IPO
Bitcoin dropped back after touching a new high above $64,800 on Wednesday. The cryptocurrency was down about 1% and holding jsut below $63,000 early Thursday, according to CoinDesk. It remains up more than 114% since Dec. 31.
Shares of cryptocurrency exchange Coinbase Global (COIN) jumped 31% in their initial day of trading on Wednesday. The Coinbase IPO rocketed as much as 66% higher intraday. Shares priced at 250 and ended the session at 323.28, giving the company a market valuation of $87.3 billion. Coinbase stock gained 3% in at the open trade on Thursday.
CAN SLIM rules advise against jumping into IPOs too early, amid all the initial offering speculation and excitement. It is better to sit and watch the new stock's chart. Waiting for it to form and breakout from an IPO base helps limit downside risk.
Vital Signs: Oil, Copper, Bond Yields
Oil price futures eased after Wednesday's hefty surge, with West Texas Intermediate down 0.7% but holding above $62 a barrel early Thursday. Wednesday's surge punched prices to their highest level since mid-March, but still below an early-March high at $65.05. Oil prices are an important confidence indicator for the recovering economy.
Copper prices jumped 1.8%, to above $4.20 a pound. Prices struck an almost 10-year high at $4.30 on Feb. 24.
Stock Market ETF Strategy And How To Invest In The Current Uptrend
Bond yields dipped to 1.59%, after taking a sharp dive on Tuesday. CBOE data showed the 10-year yield closing at 1.63% on Tuesday, after its largest single-day drop since February. Yields skirted pre-pandemic levels early this month, climbing above 1.76% — the highest level since January 2020.
Dow Jones Industrials +10.2%, S&P 500 +9.8%, Nasdaq +6.8%
The Dow and the S&P 500 are each working on their third-straight monthly advance. The Dow is up 2.3% so far in April — on top of a 6.6% blowout rally in March — and has gained 10.2% since Dec. 31.
Wednesday's action trimmed the S&P 500 April advance to 3.8%, and up 9.8% year-to-date.
For more detailed analysis of the current stock market and its status, study the Big Picture.
Meanwhile, the Nasdaq is working on its sixth-straight monthly advance. Gains in February and March were, however, incremental — sticking close to 1%. April appears to be breaking that gridlock, with the index so far up 4.6% for the month, even after Wednesday's decline. The Nasdaq is up 6.8% since Dec. 31.
The Invesco QQQ Trust ETF (QQQ) topped a 338.29 buy point on Tuesday, then pulled back below the entry on Wednesday. The leveraged ProShares UltraPro QQQ (TQQQ) is a bit more than 4% below a similar entry at 111.61.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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