The stock market took another roller coaster ride in late-session trading Friday, a day after the White House agreed to a phase-one trade deal with China that ends the threat of new tariffs on some goods as soon as Dec. 15, and cuts existing tariffs on others. Apple (AAPL), Visa (V) and American Express (AXP) were the big winners on the Dow, helping to keep the bellwether 30-stock index above water after an early sell-off.
XThe Dow was just above break-even, after selling off early, recovering, then selling off again. The S&P also was basically unchanged, up only marginally. The Nasdaq added 0.2%, as the small-cap Russell 2000 index declined 0.5%.
Volume was off, with NYSE turnover off 8% and Nasdaq trade off 9% from the same time a day earlier.
Apple rose 1.4%, as it dodged the possible imposition of tariffs on its Chinese-sourced iPhones, which could have hurt sales during the vital Christmas selling season. With Friday's rise, Apple stock hit a new high, as it continues above the 20% profit-taking zone over a 221.47 flat base buy point.
Visa, which is on the IBD 50 list of top growth stocks, continued its recent gains, adding 1.4%, while American Express moved up 1.7%. Leaderboard stock Mastercard (MA) jumped 1.4%, breaking out above a 293.79 entry from a flat base. All of these stocks moved up following the Fed's Wednesday decision to keep interest rates unchanged, and by suggestions that the central bank saw little chance of any interest rate move in the near future.
Boeing Weighs On The Dow
The Dow's gains were restrained, however, by ongoing woes at beleaguered airplane maker Boeing (BA), which fell 1.3% in early afternoon trade. Boeing has had a tough week, with the FAA saying it would not recertify the troubled 737 Max jet for renewed use this year, following two deadly crashes in the past year. Boeing also lost a potentially lucrative contract to archrival Airbus to supply Qantas with long-distance jets.
Dow Inc. (DOW) was another thorn in the Dow average's foot. The stock fell 2.2%. Industrial materials maker Dow is working on three quarters of double-digit EPS declines, a bad sign for a stock. According to the IBD database, analysts see a 34% drop in 2019 EPS, but that will be followed by an 18% gain next year.
Meanwhile, the IBD 50 served up a number of stock market winners, in particular some cloud-based software stocks.
Paycom Software (PAYC), which makes cloud-based personnel software, rose 1%. The stock earns a 99 Composite Rating and sits at No. 1 in its industry group. The stock broke out above a 259.81 buy point from a cup base in late November, but then sold off earlier this week. With Friday's gain, it is just 1% below the buy zone again.
ServiceNow (NOW), a cloud-based provider of software for workflow automation and management, added 2.8%. The stock is building the right side of a three-month consolidation, still 10% below its 303.27 buy point. It holds a 95 Composite Rating.
Another cloud software name, Veeva Systems (VEEV), moved up 2.4%. Despite seven straight quarters of double-digit EPS gains, the stock has struggled near the bottom of a lengthy consolidation. It remains below both its 50-day moving average and its 200-day moving average. Despite a powerful 99 EPS Rating, it has just a 79 Composite Rating, due mainly to its weak group relative strength and falling Accumulation/Distribution Rating, a warning sign that institutions and funds are selling the stock.
Two old-school software stocks, Adobe Systems (ADBE) and Microsoft (MSFT), also strutted their stuff on the IBD 50.
Stock Market: Other Software Winners
Adobe jumped 3.9%, gapping up and out of a three-month long cup with handle above a 310.10 buy point and into a buy zone one day after reporting a 25% EPS gain in Q3, beating Wall Street estimates. With a Composite Rating of 92, Adobe ranks No. 2 in its industry group behind Microsoft.
Microsoft stock rose 0.8%, extending its price 9% above a 142.47 buy point from a flat base. Microsoft stock's relative strength line moved into new high territory, a bullish sign for a stock reaching an all-time high.
Three other IBD growth stocks warrant mention, following the trade deal: Language and training and test-prep provider New Oriental Education (EDU), up 0.8%, Chinese online retailing giant Alibaba Holdings (BABA), up 0.2%, and social media platform Momo (MOMO), which gained 0.7%.
Looking at exchange trade funds, the Innovator IBD 50 ETF (FFTY) rose 0.4%.
Elsewhere, among IBD Stocks on the Move, computer security software stock Rapid7 (RPD) jumped 8%.
Brazilian fuel distributor Arcosa (ACA), a late 2018 IPO, gapped up 7.1% above a 39.84 buy point from a cup. It's now moderately extended in price above the buy zone, as its RS line moved into record territory along with its price.
Home solar equipment provider Enphase (ENPH) jumped 4%, as it struggles to build a base after soaring 343% above its 5.68 buy point from a brief consolidation pattern in mid-2018. The stock carries an impressive 99 Relative Strength Rating.
Trade the IBD 50 in one click via Innovator IBD 50 (FFTY), an ETF managed by Innovator Capital. Please follow Jones on Twitter at @IBD_TJones for more on growth stocks, financial markets and the economy.
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