Dow Jones rallies; Tesla dives, leads the “race to the bottom”; Warren Buffett’s stock market craters

The Dow Jones Industrial Average gained as stocks reversed higher on Thursday. You’re here (TSLA) plunged after its Investor Day event fell flat. Warren Buffett Stock Snowflake (SNOW) fell, while the crypto bank Silvergate Capital (SI) cratered.


A lone stock dared to attempt a breakout amid broader and difficult action. FirstSource Builders (BLDR) managed to clear a buy point after reversing higher.

Stocks rebounded impressively after being pushed lower amid continued strength in the labor market. Initial weekly jobless claims surprisingly fell to 190,000 from 192,000 the previous week. They were expected to be 200,000.

This has raised fears that the Federal Reserve may raise rates for longer. But stocks hit back amid reports Atlanta Federal Reserve Chairman Raphael Bostic, who is not a voting member, said the central bank may be able to pause tightening by the middle or the end of summer.

The yield on the benchmark 10-year Treasury note rose seven basis points to 4.06%. Oil rose slightly, with West Texas Intermediate crude gaining slightly to trade at around $78 a barrel.

Nasdaq reverses higher, IBD 50 lags

The market’s current uptrend remains under pressure, but stocks showed some resilience on Thursday.

The Nasdaq fought its way out of the red to post a 0.7% gain. Dexcom (DXCM), a market leader in continuous blood glucose monitoring devices for diabetics, performed well with a gain of 9.5%.

The S&P 500 also reversed higher, up 0.5%. Take-Two interactive software (TTWO) did well here, up 6.1%.

S&P 500 sectors were mostly positive. Utilities and Technology fared better, while Financials lagged.

Small caps managed to fight back, with the Russell 2000 gaining 0.2%. Growth stocks managed to enter positive territory late, with the Innovator IBD 50 (FFTY) ETF gaining 0.1%.

Dow Jones Today: Salesforce Stock Soars

The Dow Jones Industrial Average was the strongest major index all day. He reached the close to gain over 300 points, or 1.1%.

The blue chip barometer was strongly boosted by the performance of Selling power (CRM). It came off a cup-with-handle base, topping a high-volume entry of 178.94 after beating fourth-quarter views. It ended the session up 11.5%. The stock had its biggest percentage increase since August 2020.

Intel (INTC) and Boeing (BA) also performed well, rising 3.4% and 2.7% respectively.

JPMorgan Chase (JPM) was the biggest laggard among the Dow Jones Industrials, falling 1%.

The market rally marks a bullish return; AI stock rises late

Tesla Stock Slammed as Investor Day Falls Flat

One of the stocks that failed to make a comeback was Tesla, which was the worst performer in the S&P 500. It was boxed in after its investor day fell short of expectations.

Investors were left disappointed after the company failed to unveil a next-generation electric vehicle, with CEO Elon Musk declining to answer a question about the new products.

One analyst keeping the faith is Adam Jonas of Morgan Stanley. He was impressed with the company’s aim to deliver cheaper electric vehicles and said “the bold vertical integration efforts are about to pay off.”

“In a race to the bottom, we are seriously wondering how the competition can keep up,” the analyst, who calls TSLA overweight with a target of 220, said in a note to clients.

Nevertheless, analysts weren’t too impressed with Tesla’s presentation and gave mixed reactions. Tesla stock fell 5.9%, losing ground on its 200-day moving average in the process.

Dives into the actions of Warren Buffett

Even the greatest investors can suffer painful losses. And that was the case for Warren Buffett after Snowflake fell on Thursday.

The stock was hammered despite Wall Street’s views on earnings and sales in its latest quarterly report. The revenue forecast for the current quarter was lower than analysts’ expectations.

Snowflake also announced a $2 billion share buyback program. The former Leaderboard stock ended the session down 12.4%. It broke below the 50-day moving average, a sell signal.

Berkshire Hathaway (BRKB), led by Warren Buffett, owns more than 6 million shares of SNOW.

Crypto Bank Silvergate Capital Craters

Crypto lending bank Silvergate Capital was decimated in the stock market today, plunging 57.7%. It is feared it could eventually go bankrupt after the company revealed it would miss its March 16 filing deadline. This is in addition to the fact that the filing of its annual reports is already overdue.

Silvergate said it needs more time to complete certain audit procedures. He also said he was “analyzing certain regulatory and other inquiries and inquiries.”

The company also revealed that it will likely miss an interest payment on the Series A Preferred Shares, which equates to a yield of over 5.3%. The crypto bank was badly damaged by the fallout from the FTX scandal, with deposits weak in the fourth quarter.

A large number of companies, including Coinbase (COIN), no longer accept or make payments to or from Silvergate.

The company was previously a small community bank before entering the cryptocurrency space with the aim of further growth.

The shares have fallen more than 97% from their all-time high of 219.75, which they reached in November 2021.

Excluding Dow Jones: Builders FirstSource Tests Point of Purchase

When escapes were hard to come by, one brave customer tested an entry.

Builders FirstSource is trading in a buy zone after clearing an entry of 86.58. The relative strength line has just reached new highs, a bullish sign. The overall performance is very solid, earning it an IBD composite rating of 95 out of 99.

Please follow Michael Larkin on Twitter at @IBD_MLarkin for more growth stock analysis.


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