Stock market: Dow Jones falls 480 points due to high CPI inflation data. Arm and AI stocks drop sharply

Stock market: Dow Jones falls 480 points: In the world of finance, the Dow Jones Industrial Average went down a lot on Tuesday – more than 475 points. This happened because of a report on inflation that was higher than expected, making people think about possible changes in interest rates. Some big losers in this situation were Arm Holdings (ARM), as well as two other artificial intelligence companies – Arista Networks (ANET) and Cadence Design Systems (CDNS).

Stock market: Dow Jones falls 480 points
Stock market: Dow Jones falls 480 points (Image Credit thehindubusinessline)

Right after the stock market opened, the Dow Jones Industrial Average fell by 1.25%, and the S&P 500 went down by 1.3%. At the same time, the Nasdaq composite, which is full of tech stocks, dropped even more – by 1.8%.

Stock market: Dow Jones falls 480 points

For U.S. exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) lost 2%, and the SPDR S&P 500 ETF (SPY) had a setback of 1.3%.

The 10-year Treasury yield went up a lot to 4.28%. Also, the prices for oil kept going up, with West Texas Intermediate futures going up by 0.3%, reaching above a barrel. More info about Stock market: Dow Jones falls 480 points due to high CPI inflation data. Arm and AI stocks drop sharply.

Looking at the Current Stock Market Situation:

Impact of CPI Inflation Data and Earnings In January, the Labor Department’s consumer price index went up by 0.3% compared to the previous month, and it went up by 3.1% compared to the same time last year. These numbers were higher than what people were expecting. People thought the CPI would go up by 0.2% for the month and by 3% for the year. Additionally, the core CPI inflation rate went up by 0.4% in January, with a 3.9% increase compared to the previous year. This was more than what Wall Street expected – they were thinking about a 0.3% increase for the month and a 3.7% increase for the year.

When it comes to company earnings, some big movers were Arista Networks, Cadence Design Systems, Coca-Cola (KO), Datadog (DDOG), and Shopify (SHOP).

Even though Arista did better than expected in earnings and sales, their stock went down by 8%. Cadence had a similar situation with a 6% drop in early trading, but they stayed above the 279.33 flat-base entry mark.

Coca-Cola went up a bit in the morning, but Datadog went down by more than 6%. On the other hand, Shopify had a big drop of more than 13% in early trades.

In another part of the market, Arm Holdings had a 13% drop, giving back some of the gains from the big 29% increase on Monday.

Ups and Downs in the Dow Jones Industrial Average On the previous trading day, the Dow Jones Industrial Average went up by 0.3%, while the S&P 500 went down by a little bit – 0.1%. The Nasdaq composite, which is mostly made up of tech stocks, went down by 0.3%.

Thinking about the overall market trends, the Big Picture column from Monday said, “Last week had a lot of breakouts – almost 30 of them, according to the Recent Breakouts list in IBD MarketSmith. Even though there weren’t any big companies like Microsoft or Amazon, the quality of the breakouts was still good. The average Composite Rating was 94.4, and the average EPS Rating was 86.5. Most of them had A or B SMR Ratings.”

Read more: Here’s How One Trader Turned 1 ETH into $59K in Just 11 Hours!

As the stock market keeps going up, it’s important to read IBD’s The Big Picture column. It gives advice on how to deal with changes in the market, with new exposure levels from IBD.

Top Picks in Today’s Stock Market:

Companies to Watch Lennar (LEN), MongoDB (MDB), Samsara (IOT), and UiPath (PATH) – along with big companies like Procter & Gamble (PG) and Walmart (WMT) – are some of the best choices in the current market.

Samsara and UiPath are talked about in the Stocks Near A Buy Zone column.

Looking at Dow Jones Stocks:

Procter & Gamble Getting Close to a Good Buy Point Procter & Gamble, a big consumer products company, went down by 0.3% on Monday, going even further from a 158.38 buy point in a cup base, according to IBD MarketSmith. On Tuesday, Procter’s shares went up by 0.9%.

Walmart, a big discount store, is still a good buy after going past a 163.57 entry in a cup with handle. Even though the stock went up by 0.6% on Monday, it kept going up by 0.1% early on Tuesday.

Lennar is doing well, going past the 156.01 buy point of a flat base with a 3.2% gain on Monday. However, Lennar’s shares went down by almost 4% early on Tuesday.

MongoDB, a software leader, is out of buy range after going past a 442.84 buy point, even though it went down by 2.6% on Monday, as per IBD MarketSmith. MongoDB’s shares went down a lot by 5.5% on Tuesday.

Samsara had a good rebound from its 50-day line last week, but it went down by 2.8% on Monday. Right now, the stock is close to an official entry point at 36.91 after missing an early buy trigger at 35.18 on Monday. Samsara’s shares went down by almost 7% on Tuesday morning.

UiPath went up by 2% on Monday, breaking out past a 26.53 cup-base entry. The shares closed in a good buy range, but they went down by 8% early on Tuesday.

Top Contenders in Today’s Stock Market: Four Companies to Watch, Including a Dow Jones Leader.

Company NameSymbolCorrect Buy PointType Of Buy Point
Novo Nordisk(NVO)105.69Flat base
Merck(MRK)119.65Cup base
DraftKings(DKNG)39.35Cup base
Spotify(SPOT)202.88Flat base
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