Key stock indexes faded to a flat finish in today's stock market as a defense merger weighed on the Dow Jones industrials and software dragged the Nasdaq.
XThe Dow Jones Industrial Average gave up less than 0.1%, while the Nasdaq composite and S&P 500 were barely underwater. Small caps fared a bit worse, with the Russell 2000 down 0.4%. Volume was slightly higher on the NYSE and Nasdaq, according to early data.
While the indexes gave up big early gains Tuesday, that wasn't too surprising given the recent rally. The S&P 500 and Dow Jones are holding above their 50-day moving average lines.
United Technologies (UTX), down 4%, weighed on the Dow Jones index. The defense giant and Raytheon (RTN) on Sunday announced plans to merge to form Raytheon Technologies, with annual sales of about $77 billion. United Tech stock sliced its 200-day line Tuesday in nearly triple normal trade. Raytheon shares stumbled 5% to undercut their 50-day and 200-day lines.
Dow Jones Winners
But Caterpillar (CAT), Apple (AAPL) and Walgreens Boots Alliance (WBA) were among five Dow Jones stocks that climbed more than 1% each.
Apple stock regained its 50-day line in its sixth straight advance. Apple's Taiwanese manufacturing partner says it has enough capacity to make iPhones for the U.S. market outside China if the trade war affects production.
Food, software and aerospace/defense led the downside among IBD's 197 industry groups in today's stock market. The biggest winners included supermarkets, steel and mining stocks.
The No. 1-ranked Food-Meat Products group, down 7%, got hurt by Beyond Meat (BYND). The recent IPO, which at its Monday peak held a 646% gain from its May 2 offer price, plunged 25% in heavy trade. JPMorgan downgraded the plant-based meat products maker to neutral from overweight. But it nudged its price target up by $1 to 121. Beyond Meat stock is trading near 126.
Software Stocks Sell Off
The enterprise software group fell 3%, as a raft of IBD 50 stocks took a beating. Upland Software (UPLD) tumbled 6%, Atlassian (TEAM), Paycom Software (PAYC) and ServiceNow (NOW) shed more than 3% each. All four stocks remain near their highs and are holding above their 50-day lines.
Among sector ETFs, iShares Expanded Tech-Software (IGV) fell 1.2% to breach its 50-day line. The $2.7 billion fund's top holdings include Adobe (ADBE), Salesforce.com (CRM) and ServiceNow, which are down 2% or more apiece. IGV is working on a base with a potential 222.86 entry.
IBD 50 stocks scoring gains included Etsy (ETSY), New Oriental Education & Technology (EDU) and Cadence Design Systems (CDNS). Cadence was featured as Tuesday's IBD 50 Stock To Watch.
The Innovator IBD 50 ETF (FFTY) fell 1% on a downward reversal to test its 50-day line in the stock market today.
Follow Nancy Gondo on Twitter at @IBD_NGondo
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