As excitement mounted for the upcoming U.S. employment report set for Friday, the Dow Jones Industrial Average ended Thursday positively. Advanced Micro Devices (AMD) attracted increased interest due to its progress in artificial intelligence endeavors, while Nvidia (NVDA) also showed advancements. Renowned investor Bill Ackman has stakes in three companies set to go public soon, including Google’s parent company Alphabet (GOOGL).
While there were no major breakthroughs, significant players made strides as new contenders emerged. Ralph Lauren (RL), Warren Buffett-backed Snowflake (SNOW), and the prominent Booking (BKNG) all demonstrated notable progress.
Pre-Employment Report Insights
Initial jobless claims for the week ending December 2 rose to 220,000, a slight increase of 1,000 from the previous period, with the official employment data scheduled for release on Friday. This figure was slightly below expectations. Continuing claims for the week ending on November 25 totaled 1.861 million, showing a decrease of 64,000 from the prior period.
The upcoming release of nonfarm payroll data for November by the Labor Department is the focal point amid this week’s flurry of employment statistics. Analysts anticipate the creation of 190,000 new jobs, a significant rise from the 150,000 positions generated in October.
Market participants hope that setbacks in the labor market will push the Federal Reserve to contemplate interest rate cuts.
In a client advisory, Oanda’s senior market analyst Craig Erlam underscored the importance of the impending jobs report, particularly the wage component following three consecutive months of 0.2% growth. A sustained increase could signal a return to wage growth levels more aligned with 2% inflation, potentially influencing policymakers to consider an earlier rate cut next year despite the tight labor market conditions.
While Treasury yields showed mixed movements, with the two-year yield decreasing by 2 basis points to 4.59%, the 10-year yield experienced a 3 basis point increase to 4.15%. The yield curve remains inverted.
Nasdaq Rally Benefits Small Caps
The Nasdaq outperformed other major indices, posting a substantial gain of 1.4%. Sirius XM (SIRI) emerged as one of the top-performing stocks with a 4.9% increase.
The S&P 500 halted a three-session decline with an almost 0.8% upswing. Kenvue (KVUE) surged nearly 9% amid a court hearing on the potential link between prenatal Tylenol exposure and autism in children.
Communication services and systems predominantly influenced today’s stock market performance within the S&P 500 sectors, while utilities and energy sectors lagged.
Small-cap stocks also saw an uptick, with the Russell 2000 closing up by 0.8%. However, growth stocks experienced a slowdown as the Innovator IBD 50 ETF (FFTY) inched up by only 0.1%.
Dow Jones Highlights: Walgreens and Apple Shine
The Dow Jones Industrial Average advanced by 63 points, or 0.2%, despite lagging behind other major indices.
Walgreens Boots Alliance (WBA) emerged as a top performer on the Dow, surging by 7.2% and surpassing the critical 50-day moving average.
Another standout on the Dow was Apple (AAPL), contributing to the index’s positive performance with a 1% gain. AAPL stock currently trades above the initial buy point of 192.93.
Cisco Systems (CSCO) saw a 1.2% increase, while Intel (INTC) recorded a 2.1% uptick.
Conversely, Merck (MRK) and Nike (NKE) faced declines, with NKE dropping by 1.1% and MRK by 1.7%.
Nvidia and AMD Stocks Advance
Advanced Micro Devices observed a bullish trend following its recent foray into artificial intelligence, a prominent investment theme of the year.
AMD stock surged by 9.9%, breaking through a cup-with-handle entry point of 122.11. It currently sits above the 5% buy zone threshold.
The introduction of the Instinct MI300X, AMD’s latest AI venture challenging Nvidia (NVDA), fueled investor optimism. Endorsements from Meta Platforms (META) and Microsoft (MSFT) further strengthened AMD stock.
Nvidia, listed on the elite IBD Leaderboard, also experienced an uptick, rising by 2.4% and maintaining its position above the crucial 50-day moving average.
Bill Ackman’s Portfolio Update
While Bill Ackman addressed anti-Jewish sentiments in schools, some of his holdings displayed growth potential.
Alphabet, one of Ackman’s Pershing Square Capital Management assets, is nearing or within buy zones. The price of GOOGL shares is approaching 139.42, driven by the unveiling of the new Gemini AI design.
Chipotle Mexican Grill (CMG), another Ackman holding, is positioned above a cup base entry of 2,175.01, boasting a strong IBD Composite Rating.
Restaurant Brands International (QSR), the parent company of Burger King, represents the third Ackman stock on the brink of a buy zone, with a cup-with-handle entry point of 71.50.
Potential Entries Beyond Dow Jones
Several stocks are approaching buy points amid positive developments. Booking is on the verge of a buy zone with entry points at 3,251.71 and 3,207.32, showcasing robust performance in the online travel sector.
Snowflake is nearing a cup-base entry of 193.94, backed by strong performance and Berkshire Hathaway’s support.
Ralph Lauren is nearing a regular cup base entry of 135.75, demonstrating cost efficiency over the past year.
