The major market indexes closed mixed after searching for direction through Monday's session. Only the Nasdaq finished with a modest gain as tech stocks led the upside.
XThe Nadsaq composite rose 0.3%, while the Dow Jones industrial average and S&P 500 fell 0.5% and 0.4%, respectively. The small-cap Russell 2000 finished with a 0.2% loss. Volume was lighter on the NYSE and Nasdaq, according to preliminary data.
Big-cap tech stocks showed strength as Intel (INTC), Microsoft (MSFT), Cisco (CSCO), IBM (IBM) and Apple (AAPL) advanced. Intel rose more than 2% in above-average trade. Nomura hiked its rating on the chip giant to buy from neutral and maintained a 50 price target. The firm thinks Intel will be the only chipmaker to raise estimates this month and next.
Microsoft added 1% as it tries to stay close to its 50-day moving average. The stock has held up better than most other blue chip techs. It's advanced 28% this year and is just 5% off its high. Intel is down 2% year to date; IBM is down 15%.
Apple, up 30% in 2018 and 5% off its high, leads the Dow techs. It's one of the few that have managed to hold support at the 50-day line. The stock could set up a buy opportunity on a strong rebound off the 50-day, or could form a new base. Either way, all stock purchases are highly risky with the market in correction.
Apple rose 1.5% on Friday after Wedbush Securities initiated coverage with an outperform rating and added it to its "Best Ideas List." Rosenblatt Securities on Monday said preorders for Apple's iPhone XR appear weaker than expected, but reiterated a buy rating.
Tech Stocks Up, Biotech Down
Apparel, internet retail and software stocks led the upside among sectors. But food, biotech and bank stocks lagged.
Highly rated internet retail stocks rising included Amazon.com (AMZN) and Etsy (ETSY). Amazon climbed 1.4% in weak volume as it continues to trade between its 50-day and 200-day lines. Etsy, which leapt more than 5%, is also stuck between its moving averages. Amazon is 12% off its high; Etsy is 17% below its mid-September peak.
Stitch Fix (SFIX), up 1.5% Monday, is 53% off its high. Shares of the November IPO gapped down and plunged 35% Oct. 2, after reporting weaker-than-expected quarterly sales. That sent the stock well below its 50-day line. It appears to have found a bottom near the 24 level.
Marijuana stocks weighed on the biotech group, which slid 2% in the stock market today. Tilray (TLRY) plummeted 16%, Cronos Group (CRON) tumbled 12% and Canopy Growth (CGC) sank 11%. Volume was lower in Tilray and Cronos, but was heavy in Canopy, which sliced its 50-day line. The three stocks are 58%, 44% and 29% off their respective highs.
Pot stocks have dropped since Wednesday, when recreational cannabis became legal in Canada. Canadian marijuana giant Aurora Cannabis will start trading on the NYSE Tuesday under ticker ACB.
This week is packed with earnings. Five Dow stocks are scheduled to report Tuesday: 3M (MMM), Caterpillar (CAT), McDonald's (MCD), United Technologies (UTX) and Verizon (VZ).
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