Dow Jones Pares Losses, Nasdaq Extends Lead; Retailers Dive, Growth Stocks Rally

Stocks remained mixed in afternoon trade Wednesday, as the Nasdaq and S&P 500 flashed signs of late strength, while the Dow Jones Industrial Average whittled away at its earlier losses heading into the final hour of pre-holiday trade.

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The Nasdaq firmed to a 0.3% gain, and the S&P 500 defended its 0.2% advance. The Dow Jones industrials narrowed it early 0.6% loss to less than 0.1% in the stock market today. Small caps tracked by the Russell 2000 fought back from narrow losses to tight gains. Volume remained sharply lower on both major exchanges vs. the same time Tuesday. The stock market will be closed Thursday for Thanksgiving.

The strength in growth stocks held as, among exchange traded funds, the Innovator IBD 50 (FFTY) kept its 2% gain in a strong show of support at its 200-day line. The iShares Russell 1000 Growth ETF (IWF) gained 0.4%, and the Nasdaq 100-tracking Invesco QQQ Trust (QQQ) added nearly 0.1%.

Jobless Claims Hit 52-Year Low: Fed Poised To Act On Inflation

Early Wednesday, the Labor Department said weekly jobless claims fell to 199,000. That marked the lowest level since 1969, coming in also well below Econoday estimates for 264,000 claims, as well as the prior week’s 268,000 filings.

Minutes released from the Federal Reserve’s November meeting showed members of the Federal Open Market Committee increasingly poised to shift from their watchful waiting stance on inflation. “The Committee should be prepared to adjust the pace of asset purchases and raise the target range for the federal funds rate sooner than participants currently anticipated if inflation continued to run higher than levels consistent with the Committee’s objectives,” according to the minutes.

The U.S. economy continues to recover from the Covid-19 pandemic, which triggered nationwide lockdowns more than a year-and-a-half ago. A resurgence in cases fueled by the more contagious delta variant had been slowing as vaccinations rise.

But parts of Europe are shutting down or planning to do so again, and cases are rising again even in parts of the U.S.

Globally, Covid-19 cases have topped 259 million, with over 5 million deaths, according to Worldometer. In the U.S., cases are approaching 49 million with more than 796,000 deaths.

Earnings Movers

HP Inc. (HPQ) gapped up and surged almost 11% in huge volume, breaking out past a 32.38 buy point of a cup with handle, according to IBD MarketSmith analysis. It had climbed past the entry the past two sessions but closed below it each time. HPQ stock is out of buy range of the standard buy point, which topped out at 34.

But the gap-up gain created a breakaway gap buying opportunity. This would use the high marked just after the open, at 35.54, and create a buy zone that runs to 37.32.

After the close Tuesday, HP delivered fiscal Q4 results that topped views on both the top and bottom lines. HP’s…