Dow Jones falls on SVB rescue plan; First Republic, Charles Schwab plunges into banking anxiety

The Dow Jones Industrial Average turned higher Monday morning as global markets grappled with the ongoing crisis in US banks. The FDIC and other financial regulators guaranteed all deposits from SVB Financial (SIVB). Supervisors also took control on Sunday signature bank (SBNY). Meanwhile, San Francisco First Republic (FRC) crashed 69% in morning trading despite additional funding from the Federal Reserve and JPMorgan (J.P.M.). Finally, Karl Schwab (SCHW) plummeted 16% amid ongoing banking fears.


On the economic front, eyes will be on the consumer price index on Tuesday. CPI is expected to rise 0.4% both overall and excluding food and energy. That would bring headline CPI inflation down from 6.1% in January to 6%, while core inflation would fall from 5.6% to 5.5%.

Earnings are still trickling down this week at the end of the season. being among them Academy Sport & Outdoors (ASO), Adobe (ADBE), Dollar General (DG), FedEx (FDX), Five below (FIVE), GitLab (GTLB) and lennar (LEN).

Fair today

Drug giant Pfizer (PFE) agreed to pay $43 billion for biotech seen (SGEN). Pfizer shares rose 0.3%, while SGEN shares rose 15%.

Leader of genetic screening tools Illumina (ILMN) previously jumped more than 11% on news reports that activist investor Carl Icahn was planning to nominate three individuals to the company’s board of directors.

Leader of electric vehicles Tesla (TSLA) fell more than 2% Monday morning after Wolfe Research downgraded the stock from outperform to peer-perform. Dow Jones tech giants Apple (AAPL) and Microsoft (MSFT) rose after the stock market opened.

IBD Leaderboard watch list stock Palo Alto Networks (PANW) and New relic (NEWR) — as well as Dow Jones stocks Sales team (CRM) — are among the top stocks to watch during the new stock market correction.

Palo Alto is an IBD Leaderboard watchlist stock. New Relic was recently an IBD Stock Of The Day. And Salesforce was in the Stock column last week near a buy zone.

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Dow Jones Today: Oil Prices, Treasury Yields

After the market opened on Monday, the Dow Jones Industrial Average rose 0.3% and the S&P 500 fell 0.1%. The tech-heavy Nasdaq composite wiped out sharp losses in the morning action, with Seagen and Illumina topping the index.

Among US exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.1% and the SPDR S&P 500 ETF (SPY) fell 0.2% on Monday.

The 10-year US Treasury yield fell to 3.69% on Friday. On Monday, the 10-year yield plunged to 3.47% in early morning trading as safe-haven trading pushed bonds sharply higher after the collapse of the SVB. The dollar fell lower, losing ground against the euro and yen.

Oil prices sold off Monday morning after Friday’s brief rally. West Texas Intermediate futures fell nearly 5% in early trading, trading below $73 a barrel early Monday. Gold and silver also rose sharply as investors sought solid ground. Gold rose 1.4% to above $1,892 an ounce. Silver rose 3.3% and cleared $21 an ounce.

Stock market correction

On Friday, the stock market sold off sharply as the main stock index ended with major losses. The Dow Jones Industrial Average was down 1.1% and the S&P 500 was down 1.45%. The tech-heavy Nasdaq fell 1.8%.

Friday’s Big Picture column noted, “IBD on Thursday changed its market outlook to ‘uptrend under pressure’. And after Friday’s sell-off, we further downgraded our outlook to ‘market in correction’. This requires investors to avoid stock purchases and turn to defensive trading, such as taking profits and limiting losses.”

This is an important time to read IBD’s The Big Picture column amid the new stock market correction.

Five Dow Jones stocks to buy and watch now

Dow Jones Stocks to Watch: Salesforce

In recent weeks, Dow Jones leader Salesforce has shown great upside after strong fourth-quarter results. But those gains have largely vanished amid recent market weakness, and now the stock is back below the 178.94 cup-with-handle entry. Still, the stock’s recent strength is a reason to watch the software leader in the coming sessions. The CRM share rose 0.5% on Monday.

4 Top Growth Stocks to Buy and Watch in the Stock market correction

Top stocks to watch: Palo Alto, New Relic

IBD Leaderboard watchlist stock Palo Alto Networks continues to trade calmly in a handle after rising 12.5% ​​on Feb. 22. The shares remain within striking distance of a base’s 192.94 buy point. Bullish, the stock’s relative strength line is at new highs as the stock far outperforms market averages. PANW shares fell 0.8% Monday morning.

backstory: On Feb. 21, the cybersecurity giant reported good results for the quarter ended January, when earnings were $1.05 per share, up 81% from a year earlier, on a 26% increase in revenue to $1. 7 billion.

The recent IBD stock of the day, New Relic, is working on a flat base with a buy point of 80.98 in the wake of the February 8 earnings-driven surge. The RS line will hold for the time being. Shares of NEWR fell 1.6% on Monday.

backstory: New Relic offers a cloud-based suite of software products that enable organizations to collect, store and analyze massive amounts of data in real time. Customers gain greater insight into their business software to help make data-driven decisions.

Learn how to time the market with IBD’s ETF market strategy

Stocks to keep an eye on when the stock market corrects

Here are five top stocks to watch in today’s stock market, including two Dow Jones leaders.

Company Name Symbol Correct point of sale Point of sale type
New relic (NEW) 80.98 Flat base
American Express (AXP) 182.25 Cup with handle
Palo Alto Networks (PANW) 192.94 Cup with handle
Sales team (CRM) 178.94 Cup with handle
Source: IBD data as of March 9, 2023

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Tesla stock

Tesla shares snapped a four-day losing streak on Friday, posting modest gains. Trying to find support around its key 50-day line, it closed around 55% of their 52-week high on Friday.

Tesla shares fell 2% Monday morning, threatening to erase Friday’s gains.

Dow Jones leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares fell 1.4% on Friday, finishing with a weekly loss of 1.7%. The stock rose 1.6% Monday morning.

Microsoft shares extended a losing streak to four sessions, falling 1.5% on Friday. The stock is more than 20% off its 52-week high following recent declines. MSFT shares rose 0.8% Monday 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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