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Stock Market Turns Negative; Cisco Systems Stock Bucks The Trend

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Stock Market Turns Negative; Cisco Systems Stock Bucks The Trend

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The stock market major indexes are all in negative territory, as they weakened in the past hour of trading. Earnings reports produced varied results for Dow Jones stocks Walmart (WMT) and Cisco Systems (CSCO).




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The Nasdaq composite trimmed 0.4% in Thursday stock market action. The Dow Jones Industrial Average gave back 0.2% and the S&P 500 inched 0.1% lower. The small-cap Russell 2000 pulled back 0.4%.

The Nasdaq composite remains below its 50-day moving average. The Dow is trading below its 21-day-exponential moving average for a third day, while the S&P 500 is under its 50-day line also for its third day in a row.

The Nasdaq 100-tracking Invesco QQQ Trust ETF (QQQ) retreated 0.4%. And the Innovator IBD 50 ETF (FFTY) shed 1%.

Volume rose on the NYSE and fell on the Nasdaq vs. the same time on Wednesday.

The benchmark 10-year Treasury yield rose 6 basis points to 4.32%.

The initial weekly jobless claims for the period ended Aug. 12 came in at 239,000 vs. the 240,000 consensus and below 248,000 in the prior week.

The August Philadelphia Fed Manufacturing Index flashed a surprise reading of a positive 12.0 vs. the negative 10.0 expected, which showed expansion in the manufacturing sector.

Stock Market Action: Cisco Stock Hits A High

According to Wednesday’s Big Picture, IBD’s recommended stock market exposure was lowered to 40% to 60% in light of Wednesday’s weak market action, down from 60% to 80% exposure.

A market under distribution is not the time for new buys and should generally be avoided. Gains can evaporate quickly in a weak market.

Avnet (AVT) rallied over 7% after the semiconductor and electronics maker beat fiscal fourth-quarter earnings and sales, and gave Q1 sales and EPS guidance above analysts forecasts.

Dow Jones stock Walmart erased gains, now down 1.3% after the big box retailer beat fiscal second-quarter earnings and sales estimates and raised its full-year 2024 revenue and adjusted EPS. The stock is finding support at its 50-day line.

Dow component Cisco Systems gained 3.8% after reporting better-than-expected fiscal Q4 profit and revenue. Shares hit a 52-week high on the move and Cisco is the Dow’s biggest gainer Thursday. The stock hit the 53.89 buy point of a three-weeks tight pattern and is in a buy zone reaching to 56.58.

Aluminum packaging stock Ball (BALL) popped 3.1% after it agreed to sell its Ball Aerospace business to U.K.-based BAE Systems (BAESY) for $5.6 billion, according to a Barron’s article. BAE Systems stock sold off 4.3% on the news.

Warren Buffett-backed stock StoneCo (STNE) cratered 8% in heavy volume, despite reporting positive Q2 earnings and sales numbers, and giving third-quarter revenue guidance above analysts’ estimates.

Other Movers: CVS Stock Sinks And Takes Others With

Synopsys (SNPS) gave back gains, and is now relatively unchanged, after the semiconductor test software maker reported a beat on its fiscal Q3 sales and profit estimates. Shares are back below the 50-day line.

CVS Health (CVS) plummeted over 9% on news that Blue Shield of California will no longer use CVS Caremark for its pharmacy benefit manager. Instead Blue Shield will utilize Amazon‘s (AMZN) at-home delivery service and Mark Cuban’s Cost Plus Drug company for its low-cost drugs.

The stock fell below its 50-day line, flashing a sell signal. Amazon stock was flat.

Meanwhile, health care stock Cigna Group (CI) tanked over 7% and Dow stock UnitedHealth Group (UNH) fell 1.2% in sympathy with CVS.

Wolfspeed (WOLF) stock gapped down over 18% after the company reported a larger-than-expected fiscal Q4 loss and guided for a larger first-quarter loss and lower revenue. The power device maker’s stock fell further below the 50-day line.

Hawaiian Electric (HE) sank 20% in heavy volume on news of its potential liability in the Maui wildfires, according to the Wall Street Journal.

Lastly, office management software company Asure Software (ASUR) tumbled over 15%.

Follow Kimberley Koenig for more stock market news on Twitter @IBD_KKoenig.

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