Dow Jones Falls 175 Points On Key Inflation Data; Amazon Stock Surges On Earnings

The Dow Jones Industrial Average fell 175 points on Friday, amid important inflation data including the release the Personal Consumption Expenditures (PCE) Price Index. Amazon (AMZN), meanwhile, surged after strong earnings.

The Commerce Department released its Personal Income and Outlays Report ahead of Friday's opening. Personal income increased 0.3% in September, compared to the 0.4% expected growth.

The PCE index rose 0.4% in the month. This was slightly lower than the estimate of 0.5%, but the annual increase of 3.4% matched expectations. The PCE core price index increased 0.3% in the month with an increase of 3.7% over the past year. The two core PCE readings were in line with Wall Street targets.

The University of Michigan consumer sentiment survey also showed that one-year expectations of inflation were 4.2% in October, compared to the estimated 3.8%.

Amazon's stock rose nearly 7% on Friday, after the company announced earnings and revenue growth in its third quarter that exceeded Wall Street estimates.

Chipotle Mexican Grill, Deckers Outdoor, Dexcom and Intel were all major movers on Friday.

Deckers shares rose 15% in early trading, while Chipotle stocks jumped 4%. DXCM shares jumped 12% in early trade, while Intel shares rallied over 10%.

Dow Jones Today: Oil prices, Treasury Yields

The Dow Jones Industrial Average dropped 0.5% after Friday's opening, while the S&P 500 fell less than 0.1%. In morning trading, the tech-heavy Nasdaq Composite rose 0.65%.

The Nasdaq-100 tracker Invesco QQQ Trust gained 0.6% while the SPDR S&P500 ETF (SPY), a U.S. Exchange Traded Fund, moved lower on Friday morning.

The yield of the 10-year U.S. Treasury Bond ticked up to 4.86% on Friday morning. The benchmark was 4.84% on Thursday.

Stock Market Correction

The Dow Jones Industrial Average fell 0.8% at the close of Thursday's session, a further sign of bearishness. The S&P 500 closed the day with a 1.2% loss, while the tech-heavy Nasdaq composite fell 1.8%.

The Big Picture's column on Thursday stated, "During market corrections, the risk potential is so high that it is better to stay away from the market than buy. Remember that the market corrections of leading stocks are usually 1.5 to 2.5x greater than those in general. This can have a negative impact on your portfolio. "You can achieve a great deal of outperformance in the market by avoiding large drawdowns and keeping your exposure low during bad markets."

The current market correction status makes it a good time to read The Big Picture. Make sure you read about how to deal with changing market forces.

Stock Market Today

Tesla (TSLA), the electric-vehicle manufacturer, rose 0.6% on Friday morning. Nvidia (NVDA), meanwhile, gained 0.5%. Apple (AAPL), Microsoft (MSFT), and other Dow Jones tech giants traded higher today after the stock market opened.

Dow Jones Stocks: Walmart, UnitedHealth

According to IBD MarketSmith's chart analysis, Dow Jones retail giant Walmart has traced a cup-base with a buy point of 165.85. This week shares recovered their 50-day line, and are only 2% from their most recent entry. WMT stock fell 0.4% Friday.

UnitedHealth, the giant in health care, has added a handle to its massive consolidation. The stock is showing a new purchase point of 546.78. UNH's stock price fell slightly Friday morning.

Stocks to Buy and Watch: Tradeweb Breaks out

International Seaways has moved closer to the cup with handle entry of 48.40 and is within striking distance from the buy trigger. INSW's stock rose 1.1% on Friday morning.

Lululemon fell 2% on Thursday. It is still below the 406.94-point buy point for a flat basis, according to IBD MarketSmith's pattern recognition. As a signal to buy, wait for another sustained movement past that entry. LULU's stock rose 0.4% on Friday morning.

Light & Wonder, a casino game manufacturer, fell 1.2% on Thursday as the shares continued to trace a base of flat with a 79.97 purchase point. LNW's stock rose 0.3% in early Friday trading.

After the company's earnings for its third quarter, Tradeweb broke through a flat-base's 87.53 buying point. Remember that the correction in the market should prevent you from purchasing breakout stocks. Tradeweb, however, is showing unusual strength despite the weak market. TW gained 0.8% on Friday morning.

Here are the four best stocks in today's market. One of them is a Dow Jones leader.

Tradeweb Markets TW 87.53 Flat Base

Source: IBD data as of Oct. 26, 2023

Tesla Stock

Tesla's stock fell 3.1% on Thursday, closing further below the 200-day line. The shares are still trying to find support around that long-term line, but are about 30% below their 52-week peak.

Early Friday morning, shares rose almost 1% as investors looked to recover from Thursday's losses.

Dow Jones Leaders - Apple and Microsoft

Apple, among Dow Jones stocks lost 2.5% on Thursday, losing support near the 200-day mark. Apple will release its fiscal fourth quarter report on November 2. Early Friday, shares rose by 0.4%.

Microsoft stock fell 3.75% on Thursday as it gave up its two previous entries, a buy trigger of 340.86 and a buy trigger of 336.14. MSFT rose 1.5% on Friday morning.