Stocks scored big gains Tuesday as the major market indexes gapped up at the open and plowed higher throughout the session.
XThe S&P 500 and Nasdaq composite reclaimed their 200-day moving averages with authority, while the Dow Jones industrial average padded its gains above the support line.
The Nasdaq led with a 2.9% surge as tech stocks bounced back from recent weakness. The broad rally boosted the S&P 500 to a 2.2% gain and the Dow also to a 2.2% advance. Small caps also enjoyed solid gains with the Russell 2000 up 2.9%. Volume was significantly higher on the Nasdaq, while volume on the NYSE was close to Monday's level.
All 30 Dow stocks rose, with UnitedHealth Group's (UNH) 5% gain taking the lead. Shares gapped up above the 50-day moving average, which they had given up last week. The nation's biggest health insurer reported better-than-expected Q2 earnings and revenue before the open.
The Medical-Managed Care group, to which UnitedHealth belongs, has rallied as sector rotation occurs in the market. Health care is a defensive play. The Medical sector ranks No. 1 of the 33 sectors tracked by IBD, with a near 20% gain. Among other stocks in the managed care group, Centene (CNC) soared and WellCare Health Plans (WCG) each soared more than 4%.
Both stocks also rallied off support at their 50-day lines. Centene was added to Leaderboard on Tuesday as an option play ahead of its Oct. 23 earnings. WellCare was featured in Tuesday's Stock Spotlight column.
Big-cap techs also participated in the market rally with Intel (INTC), Microsoft (MSFT), Cisco (CSCO) and Apple (AAPL) each rising more than 2%. Cisco and Intel remain below their 50-day lines, while Microsoft was trading right about at the support line.
Apple continued to find support at its 50-day but has yet to stage a solid rebound above the line. If it does, that could mark an opportunity to buy or add shares, since it's the first pullback to the 50-day (or 10-week line on a weekly chart) since its August breakout. However, the market is still in a correction, which makes all purchases highly risky.
Automakers, software and medical stocks were among top gainers in the stock market today. Gold miners, steel, and auto parts retailers lagged.
Leading software stocks scoring big gains included SendGrid (SEND), up 17%, after it was acquired by Twilio (TWLO); Adobe (ADBE), up 10% on bullish revenue guidance, and Cornerstone OnDemand (CSOD), which added 4%. Adobe retook its 50-day line after receiving price target hikes, which followed the software maker's upbeat financial outlook.
While most industry groups advanced, strong breakouts among leading stocks were few and far between. Amex-listed Imperial Oil (IMO) cleared a 34.39 buy point of a cup base but pared its gains to close below the entry.
YOU MAY ALSO LIKE:
After Hours: 8 Notable Stocks Rising As Investors Await Green Light
IBD Stock Of The Day: Match Stock Rebounds, Holds Up In Shaky Market
IBD 50 Stocks To Watch: Top Restaurant Serves Up New Buy Point
Adobe Stock Surges On Upbeat Financial Targets, Growth Strategy
