Stock Market Update: Small Caps Climb, Dow Edges Higher; Travel Stocks Soar on Oil Drop, Byrna and Axon Face Sell-Off (Live)

Stock Market Gains and Volatility Highlight Key Trends

On Thursday, the stock market experienced a mix of strong gains and late-day profit-taking, with the Dow Jones Industrial Average showing significant movement. The index initially surged nearly 300 points in the early afternoon but saw its gains trimmed to around 200 points by the end of the session. Meanwhile, the S&P 500 and Nasdaq continued their upward trend, hitting new highs.

Strong Performers on the Dow

The blue-chip Dow erased earlier losses, closing up 0.4%. Several stocks within the index posted notable gains, including American Express (AXP), Goldman Sachs (GS), Amgen (AMGN), and Caterpillar (CAT). These companies benefited from broader market optimism and sector-specific strength.

The S&P 500 rose 0.3%, while the Nasdaq Composite remained relatively stable, ending just slightly positive. The Nasdaq 100, however, edged lower. Trading volume varied across exchanges, with the Nasdaq seeing a 2% decline compared to the previous day and the New York Stock Exchange experiencing an 11.5% increase.

Small-cap stocks also performed well, with the Russell 2000 rising 0.5%.

Tech Stocks Face Mixed Performance

While some tech stocks rebounded, others struggled. Cybersecurity firms like Fortinet (FTNT) and Palo Alto Networks (PANW) saw sharp declines, falling more than 6% each. These drops came amid heavy trading volume and signaled technical weakness for both companies.

In contrast, travel-related stocks gained traction as crude oil prices fell. Financial, industrial, and cyclical companies also saw strength following a surprise drop in weekly jobless claims. However, data-center stocks faced losses, reflecting the broader market’s mixed performance.

ETFs and Market Indicators

The Invesco QQQ Trust (QQQ) continued to lag behind the broader market, but it only fell 0.1% and still maintained an 8.7% year-to-date gain. The SPDR S&P Bank ETF (KBE) showed near-term strength, rising over 1% before settling at a 0.6% gain. Analysts noted that the ETF is forming a narrow handle on a long cup base, which could indicate a potential buying opportunity.

Treasury Yields and Oil Prices

Treasury yields rose slightly, with the 10-year yield climbing to 4.34% after reaching a high of 4.37%. This marks a monthly increase from its level at the start of the year. Crude oil futures declined sharply, with the near-expiration contract on the Nymex dropping 2.2% to $66.91 per barrel. Despite this, several sectors, including metal ores, coal, and logistics, saw gains due to their sensitivity to energy price fluctuations.

Notable Declines and Sell Signals

Salesforce (CRM) and IBM (IBM) were among the biggest losers on the Dow, with Salesforce falling 2.6% and IBM declining 1%. Salesforce’s weak RS Rating of 25 raised concerns about its performance. The company has seen slowing earnings growth, though Wall Street still expects low double-digit gains in the coming years.

IBM, on the other hand, showed stronger chart performance, finding support at the 21-day exponential moving average. The stock has been extended after breaking out of a base at 266.45, with the 5% buy zone now at 279.77.

Strong Performers and Market Outlook

MP Materials (MP) stood out as a major winner, surging over 59% in heavy volume after securing a large contract with the Pentagon. The stock is approaching its 2022 peak and has a Relative Strength Rating of 94, indicating strong performance relative to the market.

Byrna Technologies (BYRN) and Axon Enterprise (AXON) triggered sell rules after sharp declines. Byrna fell over 21% following a drop in gross margins, while Axon slid over 8% amid technical weaknesses. MercadoLibre (MELI) also faced selling pressure due to concerns over potential tariffs on Brazilian imports.

Transportation and Aviation Stocks

Transportation stocks gained momentum following better-than-expected earnings from Delta Air Lines (DAL). The Dow Jones Transportation Average soared over 3%, reaching a four-month high. However, Embraer (ERJ) fell again, triggering a new sell rule after a fourth consecutive day of losses.

AI and Tech Stocks

CoreWeave (CRWV) and Astera Labs (ALAB) both faced challenges in the AI space. CoreWeave dropped over 4% after falling below its 21-day exponential moving average, signaling a potential shift in its performance. Astera Labs attempted a breakout but fell sharply after failing to hold above key levels.

Major Movers and Corporate News

Nvidia (NVDA) and Tesla (TSLA) saw modest gains, with Tesla rebounding from recent losses. Kellogg (KLG) surged over 30% after announcing a $3 billion acquisition deal with Ferrero. Delta Airlines also jumped 12% in premarket trading after reporting strong earnings and an upbeat outlook.

Economic Data and Market Sentiment

Weekly jobless claims unexpectedly dropped to 227,000, raising concerns about the potential for interest rate cuts. This data suggests a healthier economy, which may limit the Federal Reserve’s ability to ease monetary policy.

Tariff Concerns and Market Outlook

Wall Street remains on edge as President Donald Trump continues to announce new tariffs, including a 50% tax on imported copper and Brazil. These developments could impact global trade and market sentiment.

As the market moves forward, investors will be closely watching for signs of stability and continued growth. With key economic indicators and corporate news shaping the landscape, the next six months will be critical for determining the overall direction of the stock market.