The Dow Jones Industrial Average sold off on Friday over worries of the China coronavirus outbreak. The market recovered and closed off the lows, as the current uptrend continues. Dow Jones giant Intel (INTC) vaulted nearly 8% higher after reporting strong earnings.
XMeanwhile, Boeing (BA) rallied 2% at one point after the Federal Aviation Administration told airlines it could lift a flight ban on the Boeing 737 Max before midyear. That's earlier than had been expected. Boeing closed with a 1.7% increase.
The China virus outbreak acted as the catalyst for a market pullback Friday amid overextended conditions in stocks. After a second confirmed U.S. case of the coronavirus, U.S. health officials said they were monitoring other potential cases across 22 states. Additionally, China expanded a quarantine and travel ban to 12 cities.
The iShares China Large-Cap ETF (FXI) slid 1.25% and closed below the 50-day moving average for the first time since Dec. 10.
Stocks Fall On China Virus Fears
The Dow Jones average sold off sharply on Friday but closed off the session lows. The blue chip index closed down 0.6%. The Nasdaq Composite notched another record high Friday morning before selling off 0.9%. The S&P 500 fell 0.9% also.
Volume wsa higher on both the Nasdaq and NYSE according to unconfirmed data. Despite today's pullback, the major stock indexes have still made strong gains so far year to date. The Nasdaq is up 3.8%, while the S&P 500 is up 2% in 2020.
Among exchange traded funds, the Innovator IBD 50 (FFTY) ETF fell 1% Friday. The ETF of leading growth stocks still remains inside its 5% buy zone above a 35.52 buy point.
Dow Jones Chip Leader Intel Rallies
Intel stock rallied sharply after reporting strong earnings, though not enough to lift losses in the Dow Jones. The Dow chip giant broke out past a 5% buy zone off a cup-with-handle base. Shares of Intel are extending past their 59.23 buy point, as the stock is nearing it's 20%-25% profit-taking zone.
Intel reported earnings after the close of trading Thursday. Shares of Intel stock surged more than 8% Friday as the company beat on EPS and revenue and issued strong Q1 and fiscal-year guidance. Analysts expected EPS of $1.24 a share on $19.2 billion in revenue. The company reported EPS of $1.52 on revenue of $20.21 billion.
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Stocks Fall Amid Current Market Rally
Atlassian (TEAM) reported earnings growth of 48% while revenue grew 36% for its fiscal Q2 earnings report. Shares of Atlassian jumped nearly 11% on Friday, creating a breakaway gap for investors. The stock is now above a 140.59 buy point from a handle entry.
XP (XP) moved above the 40.60 IPO-base buy point earlier this week, but sold off alongside the market on Friday. The Brazilian brokerage company ranked on IBD's IPO Leaders list after going public back in December. Shares of XP stock fell back below a buy point on Friday. It was removed from IBD Leaderboard after the sell-off.
Among the biggest losers Friday, Discover Financial (DFS) tumbled despite an earnings beat. But its miss on revenue caused the stock to fall below it's 50-day and 200-day lines.
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