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Nasdaq Wakes Up And Rises; Small-Cap Control4 Breaks Out

Stocks swept higher near midday Tuesday, as the Nasdaq woke up and led for the first time in five sessions. Control4 broke out. Market gains were broad. Among IBD's 197 industry groups winners led losers by a 7-1 ratio.

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The Nasdaq popped 0.7%, while the S&P 500 and the Dow Jones industrial average added 0.4% and 0.3%, respectively. Small caps surged to the front with a 0.9% gain in the Russell 2000.

Volume was tracking moderately higher on both exchanges compared with Monday's levels.

Small cap Control4 (CTRL) broke out of a cup-with-handle base. The stock jumped 5% to clear a 33.57 buy point. Control4 develops software for the connected home. The Utah-based company began the week as No. 36 in the IBD 50.

Control4 had a strong price run in 2016-17 but then corrected 43% from November to April. The stock began advancing in May and appears to be back in bullish mode.

The day's leaders included the lowly rated homebuilder group.

Luxury homebuilder Toll Bros. (TOL) gapped up 11% in torrid volume. The stock remains 26% off its high. Toll reported a quarterly earnings increase of 45% vs. the year-ago period. Revenue rushed ahead 27%. Toll beat the Street's consensus estimates on the top and bottom lines and raised guidance.

Other homebuilders hitched a ride on the Toll results. Among 17 homebuilder stocks trading at 12 or higher, 16 rose.

The highest rated stock in the group is D.R. Horton (DHI). Horton is 13% off its high. In Stock Checkup at Investors.com, D.R. Horton is No. 1 in its group. The Fort Worth, Texas-based homebuilder grew quarterly earnings from 9% to 42%, 52% and 55%. Accelerating earnings growth is a bullish sign.

Day's Losers

On the downside, department stores lost ground.

Kohl's (KSS) tried to clear a 80.02 buy point but retreated after nearing the entry. The stock was down 2.5% in heavy volume. Kohl's beat analysts' views on revenue and earnings but fell anyhow. The company also raised guidance for the year.

Macy's (M) rose above its 50-day line at the opening bell but quickly retreated back under the line. The stock was off 1% in heavy volume. Macy's broke out Aug. 14 but triggered the 8% sell rule the next day.

Widely Held Stocks

Among blue chips and widely held stocks, Intel (INTC) climbed about 2%; Caterpillar (CAT), 1%; and JPMorgan Chase (JPM), 1%.

On the downside, Apple (AAPL) inched down 0.3%, following up on Monday's 1% loss.

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