Dow Jones Futures Fall on Key Inflation Data; Disney Collapses on Profits

Dow Jones futures fell lower early Thursday after another round of heavy selling on Wednesday sent major stock indices to new correction lows. More inflation data – the Ministry of Labor’s producer price index – came out before the market opened. And Dow Jones media giant Disney crashed after reporting lost revenue late Wednesday.


Dutch Brothers (BROS) and Rivian (RIVN) also announced a profit at the end of Wednesday. BROS stocks crashed 43%. Rivian shares bounced 3%, after diving 28% for a week through Wednesday.

Giant of electric vehicles Tesla (TSLA) slipped more than 3% lower Thursday morning. Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) fell 1.2% and 0.8% respectively in today’s stock market.

As the stock market correction continues to worsen, Dow Jones leaders say Chevron (CVX) and Merck (MRK) — together with Cheniere Energy (LNG), Exxon Mobil (XOM) and Northrop Grumman (NOC) — are among the top IBD stocks to watch for Thursday.

Cheniere Energy and Microsoft are IBD Leaderboard stocks. Exxon and Merck were featured in the Near Buy Zone Equities section this week.

Dow Jones Today: Treasury Yields, Oil Prices, Inflation Data

Before Thursday’s opening, Dow Jones futures fell 0.35% relative to fair value, and S&P 500 futures lost 0.7%. Nasdaq 100 futures fell 1.3% in morning trading. Keep in mind that an overnight action in Dow futures and elsewhere does not necessarily lead to actual trading in the next regular trading session.

Among exchange-traded funds, the Nasdaq 100-tracker Invesco QQQ Trust (QQQ) fell 1.7%. The SPDR S&P 500 ETF (SPY) lost 1.1%.

Yields on 10-year Treasuries fell to 2.82% on Thursday morning as bonds continued to recover from the stock market decline. On Wednesday, 10-year Treasury yields fell for the third day in a row, closing at 2.92%. Meanwhile, US oil prices traded more than 1% lower, with Texas Intermediate crude hovering around $104 a barrel after a 6% jump on Wednesday.

CPI inflation is finally falling, but not enough

Producer prices rose 0.5% in April, up from 1.4% in March, in line with Econoday estimates. Producer inflation rose 11% in April from a year ago, higher than the estimate of 10.7%. The producer price index is a measure of price power based on sales prices that domestic producers receive for their output.

On Wednesday, April’s consumer price index rose at an annual rate of 8.3%, down from the previous month’s 8.5% but higher than economists had forecast.

Finally, the first applications for unemployment rose to 203,000. Initial jobless claims were expected to drop to 190,000, compared to 200,000 claims the previous week.

Stock market correction deepens

On Wednesday, major stock indices sold sharply and hit new correction lows. The Nasdaq composite fell 3.2%, pushing the stock market down.

Wednesday’s column The Big Picture noted, “Indices started strong and managed to stay in the green for most of the day. But the temporary hiatus was used as a tactical selling opportunity, causing a painful reversal in the lock.”

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Dow Jones Earnings: Disney

Within the Dow Jones industrial sector, Disney reported revenues and sales below analysts’ targets for the fiscal second quarter. But subscriber growth for the Disney+ streaming service exceeded expectations by a wide margin.

Disney shares plunged more than 5% early Thursday. DIS shares ended Wednesday at more than 40% of their 52-week high.

Five Dow Jones Stocks To Watch Now

Dow Jones Stocks to Watch: Chevron, Merck

Dow Jones leader and energy giant Chevron in flat base with a buy point of 174.86, according to IBD MarketSmith chart analysis. CVX shares are up 1.5% on Wednesday as they fight to regain their 50-day line. Chevron shares were down 0.7% on Thursday morning.

CVX stocks have a perfect 99 IBD Composite Rating, per IBD Stock Checkup. Investors can use the IBD Composite Rating to easily measure the quality of a stock’s fundamental and technical statistics.

Drug leader Merck is just under a cup with a buy point of 89.58, after a 1.6% advance on Wednesday. Shares were unchanged early Thursday. On a positive note, the stock’s relative strength has peaked again, pointing to a major outperformance of the stock market during the current correction.

Three top growth stocks to keep an eye onrent Stock Market Correction

Stocks to watch: Cheniere, Exxon, Northrop

IBD Leaderboard Stock Cheniere Energy is one of the top stocks to watch even if it continues to trade below the 50-day line. Shares were up 1% on Wednesday as they continue to etch a flat base showing a buy point of 149.52, according to the IBD MarketSmith chart analysis. LNG shares rose 0.3% on Thursday.

Energy giant Exxon Mobil broke out last week past a cup with a handle of 89.90 points. But stocks gave up entry on Monday, remaining about 3% below the buy point. That stops when the automatic sales rule is activated. The faltering breakout illustrates the danger of owning stocks in the current market environment. XOM shares fell 0.9% on Thursday.

Defense contractor Northrop Grumman continues to etch a handle cup with a buy point of 477.36. Shares are just below their 50-day line after Wednesday’s 0.8% loss. Northrop shares fell 1.6% on Thursday.

Join IBD experts as they analyze leading stocks in the current stock correction on IBD Live

Tesla stock

Tesla shares fell more than 3% Thursday morning, threatening to add to Wednesday’s 8.25% slip. Shares remain sharply below their 50- and 200-day lines amid their recent weakness and are at their lowest level since February.

The stock traded as high as 1,243.49 on Nov. 4 and is about 36% off that figure.

Dow Jones Leaders: Apple, Microsoft

Of the Dow Jones stock, Apple shares fell 5.2% on Wednesday, falling to their lowest level since October 2021. The stock is sharply below the 200-day line and about 20% off its high in 52 weeks. Shares of Apple fell 2% on Thursday.

Software leader Microsoft fell 3.3% on Wednesday, the lowest level since June 2021. The stock closed about 25% from its 52-week high. MSFT shares fell 1% on Thursday morning.

Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.


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