Dow Jones Rallies As Merck Rockets On Covid Pill; Disney Gains On ‘Black Widow’ Settlement; Biden Makes Move
The Dow Jones Industrial Average gained as Merck (MRK) rocketed on positive trials for a Covid-19 treatment. Vaccine plays Moderna (MRNA) and BioNTech (BNTX) plunged. Disney (DIS) rose after it settled a “Black Widow” lawsuit with star Scarlett Johansson. President Joe Biden made an infrastructure bill move.
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Microsoft (MSFT) and Airbnb (ABNB) were two Leaderboard stocks making gains. Finally, two stocks passed buy points despite the challenging market conditions: Jones Lang LaSalle (JLL) and CF Industries (CF).
Biden Backs Infrastructure Vote Delay
President Joe Biden headed to Congress to try to make progress on the infrastructure deal roadblock Friday.
Moderate and liberal Democrats in the House are battling over the size and scope of the $3.5 trillion so-called human infrastructure bill.
Biden is said to have asked House Democrats to delay voting on the $1 trillion infrastructure bill, which has bipartisan support, until an agreement is reached on the more wide-ranging package.
He also reportedly conceded the social policy and climate package would have to be substantially cut back below the current $3.5 trillion price tag.
He told House Democrats the infrastructure bill “ain’t going to happen until we reach an agreement on the next piece of legislation,” according to the WSJ.
House Speaker Nancy Pelosi had said early Thursday that a vote on the latter package would be held that day, but this failed to occur.
Nasdaq Finds Support, Small Caps Surge
The Nasdaq lagged the other major indexes, closing up 0.7%. Nevertheless, the fact that the tech-heavy index is getting support is a good sign.
The S&P 500 rose more than 1%. It was managed to hold around last week’s lows, which is encouraging.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 34327.45 | +483.53 | +1.43 |
| S&P 500 | (0S&P5) | 4357.09 | +49.55 | +1.15 |
| Nasdaq | (0NDQC ) | 14566.70 | +118.12 | +0.82 |
| Russell 2000 | (IWM) | 222.43 | +3.68 | +1.68 |
| IBD 50 | (FFTY) | 47.12 | -0.25 | -0.53 |
Last Update: 4:02 PM ET 10/1/2021 |
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The S&P sectors were nearly all green, with energy and communication services turning in the best gains. Utilities was the only area to slip lower.
Small caps were outperforming, with the Russell 2000 posting a gain of about 1.7%.
Growth stocks were the big disappointment, with the Innovator IBD 50 ETF (FFTY) closing down 0.5%.
Dow Jones Today: Disney Pops On Scarlett Johansson Settlement
The Dow Jones Industrial Average made a strong start to the month, closing up 1.7%. Merck was a major reason.
But Disney stock was another of the top performers on the blue-chip index. Shares were up around 4.5% on news the media giant had settled a lawsuit with Johansson involving the Marvel tentpole movie “Black Widow.”
ScarJo had sued Disney for breach of contract after it released the film on its Disney+ streaming service at the same time it was debuting in theaters.
“I am happy to have resolved our differences with Disney,” Johansson said in a statement. “I look forward to continuing our collaboration in years to come.”
The stock remains near the bottom of a consolidation pattern with an entry of 203.12, according to MarketSmith analysis. It is closing in on its converged 50-day and 200-day moving averages
Merck Stock Hits Buy Zone, Rockets On Covid Pill
Merck was the major winner on the Dow Jones, closing up more than 8%.
The move was sparked after the pharmaceutical giant announced its experimental antiviral pill reduced the risk of death or hospitalization by 50% for Covid patients in trials.
It is now planning to file for Emergency Use Authorization.
Merck stock finished the session in a buy zone after gapping above a flat-base buy point of 79.33.
Vaccine stocks Moderna and BioNTech were smashed lower on the news. Moderna stock suffered the biggest loss, dropping more than 11%, while BioNTech closed down almost 7%.
Covid treatment stock Regeneron Pharmaceutical (REGN) finished with a loss of nearly 6%. It has round-tripped all its gains after breaking out past a 595.58 buy point.
Travel stocks were also boosted, with airline stocks such as United Airlines (UAA) and lodging stocks such as Hilton Hotels (HLT) making solid gains.
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Airbnb Stock, Microsoft Gain
Leaderboard stock Airbnb posted a gain of more than 3%. After a breakout from a bottoming base, Airbnb remains clear of its 10-week moving average.
It managed to retake its 10-day line Friday, which is a positive sign.
Microsoft was also in rally mode, rising about 2.5%. The software stock is forming a new flat base but is now well shy of the ideal buy point of 305.94.
It has some ground to make up if it wants to retake the key 50-day moving average.
These 2 Stocks Pass Buy Points
Real estate firm Jones Lang LaSalle had been showing relative strength amid market turmoil this week.
It closed the session in a buy zone after breaking out of a new flat base. The ideal buy point here is 254.03. This is also an early-stage base, which is a positive.
Big money has been getting behind the stock of late, with its Accumulation/Distribution Rating coming in at a strong B+.
Ammonia stock CF Industries is now slightly extended after surging past a cup-base buy point of 57.29.
The stock saw its relative strength line hit a new high, which is a bullish sign. The stock offers a good balance of price and earnings performance.
But the poor market conditions mean buying stocks is a risky proposition.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.
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