Major stock indexes are up over the past hour and rallying towards daily highs as investors celebrate rising jobless claims. Indeed, the increase in claims indicates a slowdown in the labor market, a key factor in shaping Fed policy.
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The S&P 500 gained 0.8% while the Nasdaq rose 1.2%. The Dow Jones Industrial Average rose 0.6%. The Russell 2000 Small Cap Index was in line with the other indexes, adding 1%.
The Nasdaq composite is testing resistance at its 21-day exponential moving average. The S&P 500 hugs its 21-day line.
The trusted Invesco QQQ (QQQ) technology-based Nasdaq 100 ETF rose 1.2%. Volume on the NYSE was higher and fell on the Nasdaq from the same time on Wednesday.
Crude oil was unchanged at $71.99 a barrel. The Energy Select Sector SPDR (XLE) ETF also remained unchanged. Natural gas jumped 7%. It is trading above $6 per million British thermal units.
The yield on 10-year Treasury bills added 6 basis points to 3.48%, near levels last seen in September.
European markets were mixed, with the German DAX unchanged and the Paris CAC 40 closing down 0.2%. London’s FTSE 100 also lost 0.2%.
The odds of a 50 basis point hike at the mid-December Fed meeting stand at 79.4%, while 20.6% are looking for a 75 basis point hike, according to the CME. FedWatch Tool.
Initial jobless claims for the week ending December 3 rose to 230,000 against the consensus estimate of 228,000. This is an increase from 226,000 the previous week and the highest level since February. The increase in unemployment claims shows a potential cooling of the labor market. The Fed uses employment numbers to help decide the pace of interest rate hikes. The next FOMC meeting will take place on December 13-14.
Diabetes equipment maker erupts
Dexcom (DXCM) widened and broke out of a flat base reaching a buy point of 123.46, according to MarketSmith’s pattern recognition. The shares rose 3.7% in strong volume and are in the 5% buy zone that extends to 129.63. Dexcom is now a leader in the S&P 500.
Dexcom is a leading manufacturer of blood glucose monitoring systems used in diabetes care. Shares are up after the U.S. Food and Drug Administration cleared its G7 continuous blood glucose monitor. The stock ranks third in the medical products industry group. The groups rank 35th out of 197 IBD industry groups.
meme stock GameStop (GME) rebounded 9% after yesterday’s heavy volume decline of 4.8%. On Wednesday evening, the company reported a bigger-than-expected third-quarter loss and missed sales estimates.
Costco (COST), lululemon (LULU) and Broadcom (AVGO) are expected to report earnings after today’s close.
Stock market today: IBD 50 beverage stock is rising nicely
The Innovator IBD 50 ETF (FFTY) edged up 0.2%, underperforming the major equity indices.
fitness drink machine Celsius (CELH) rose 4.3% and is back near the buy point of 116.29 from a cup basis.
Lattice Semiconductor (LSCC) gained 3.1% on light volume. Stocks are in a 55-week base and approaching the buy point at 73.63. The relative strength line has reached a new high, as indicated by the blue dot on the MarketSmith chart.
Shares of LSCC are up more than 41% since the start of the quarter after a positive earnings report and higher guidance in late October. Lattice ranks first in the industry group of chip designers.
Arcus Biosciences (RCUS) fell another 2.5% but is finding support at its 21-day line. The stock soared in late November on the positive efficacy of its lung cancer drug, but has since fallen.
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