The stock market rally snapped back from Tuesday's losses with solid gains across the major stock indexes early Wednesday. The Dow Jones industrials gained more than 250 points. Dow Jones stocks Home Depot (HD) and Walmart (WMT) were approaching potential breakouts amid a rally in retail stocks.
Early Wednesday, Lowe's (LOW) and Target (TGT) reported strong earnings results. Check out today's IBD Investing Action Plan for important stock market events, including earnings results from IBD 50 stock Baozun (BZUN).
XCurrent Stock Market Rally
The tech-heavy Nasdaq composite moved up 1%. The S&P 500 rallied 0.8%, while the Dow Jones Industrial Average thumped out a 0.9% advance. Year to date, the Nasdaq has climbed about 20%. The S&P 500 has gained about 16%, while the Dow Jones has moved up about 11%. (For more market updates today, visit the current stock market.)
The Nasdaq and S&P 500 are testing their 50-day resistance levels amid the recent rally. The Dow is rebounding from its long-term 200-day line.
Among exchange traded funds, Innovator IBD 50 ETF (FFTY) gained 1.2%. The ETF remains below its 50-day line.
Dow Jones Stocks: Home Depot, Walmart
Home Depot rallied 1.1%, as it approaches a 219.40 buy point in a new flat base, according to MarketSmith chart analysis. Bullishly, the stock's relative strength line is at a new high, signifying significant market outperformance.
Home Depot stock was featured in this week's Stocks Near A Buy Zone column after Tuesday's earnings-driven gains.
Rival Lowe's beat the Street's estimates, sparking an 11% surge in morning trade. Lowe's shares are moving up the right side of a new base formation.
Walmart stock is also approaching a new buy point: a 115.59 entry in a flat base. Walmart shares moved up 1.1%. The stock's RS line is at a new high.
According to the IBD Stock Checkup, the Dow Jones stock has an 81 out of a highest-possible 99 IBD Composite Rating. Investors can use the Composite Rating to easily measure a stock's fundamental and technical metrics.
Stock Market Earnings: Target Soars 18%
Early Wednesday, retail giant Target reported strong earnings results. Target shares surged 18% to a breakout above an 89.61 buy point in a cup with handle. When a stock gaps above a potential entry — called a breakaway gap — investors can use the stock's opening price as the proper entry. For Target, the open price is 99.87.
On Tuesday, retailers Kohl's (KSS) and TJX Cos. (TJX) reported their respective earnings to mixed results. Kohl's stock ended the day with a near-7% decline, as it nears a new 52-week low. TJX Cos., meanwhile, edged lower after reversing from heavy losses. TJX shares continue to shape a flat base with a 57.25 buy point.
Top Growth Stocks To Watch: Baozun Plunges
Among the IBD 50 top growth stocks, Chinese stock leader Baozun plunged 8% after its earnings results before the stock market open. The stock fell back below its 50-day line, as a new base looks to take shape.
According to IBD Stock Checkup, Baozun stock boasts a highest-possible 99 IBD Composite Rating.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the stock market.
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