Blue-Chip Stocks Lead Stock Market Rally; Roku, Snap Tumble – Investor's Business Daily

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The stock market uptrend continued on its merry way Thursday, one day after the Nasdaq composite and S&P 500 marked a distribution day.

X The Dow Jones industrial average outperformed in afternoon trading with a 0.9% gain. The blue-chip index offered up plenty of strong price performers, including United Technologies (UTX). The industrial conglomerate jumped back above its 50-day moving average, rising 3% in heavy volume. Last year, the company announced plans to acquire avionics firm Rockwell Collins (COL) for $23 billion. Many view the deal as a prelude to a breakup of United Technologies due to disparate businesses, including Carrier air conditioners and Otis elevators.

General Electric (GE), Caterpillar (CAT) and Exxon Mobil (XOM) were other top performers in the Dow, rising more than 2%.

Oil and gas stocks outperformed as April U.S. crude oil futures jumped 2.2% to $63.03 a barrel. Strength was fueled by a U.S. government report that showed an unexpected drop in supplies. IBD’s Drilling, Machinery/Equipment and Exploration/Production groups outperformed, with gains ranging from 2.5% to 4.5%.

The S&P 500 added 0.5% and the Nasdaq composite picked up 0.2%. Volume on the NYSE and Nasdaq was tracking slightly higher than Wednesday’s levels in the stock market today. A 0.2% decline for the Nasdaq really didn’t have the feel of distribution, or institutional selling, but the index gave back a lot of ground after rising about 1% early.

Heavy-volume gainers Thursday included Green Dot (GDOT). Shares jumped nearly 10% to 66.07. The stock gapped out of a consolidation with a conventional entry at 65.98 after reporting another strong quarter late Wednesday. Green Dot’s business is reloadable prepaid debit cards.

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Small-cap enterprise software name Five9 (FIVN) also broke out from a shallow, cup-shaped base with a 27.91 entry. Shares popped 12.5% to 30.36 on news adjusted profit soared 600% from the year-ago quarter. Sales rose 25% to $55.4 million.

Inside the IBD 50, retailers Floor & Decor (FND) and Five Below (FIVE) showed gains of 2% and 1%, respectively. Floor & Decor is battling to reclaim its 50-day line ahead of its March 1 earnings report. Five Below is back above the 50-day line as it works on a potential base.

On the downside, Roku (ROKU) crashed 18% to 41.60. Earnings and sales topped expectations, but sales guidance for the current quarter disappointed. Roku went public in late September at 14.

Snap (SNAP), meanwhile, swooned 7% to 17.27 as it retests a prior buy point of 16.98. Shares gapped up powerfully Feb. 7, helped by an earnings beat and strong sales growth, but a large number of users are unhappy with a recent redesign of the app. A couple of recent analyst downgrades to sell hasn’t helped matters.


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