Saturday, October 1 2022

Major stock indices spent the week processing negative news from the previous week and seeking safety at critical price levels.

The Dow Industrial Average and the Nasdaq Composite recovered from their morning lows.

As of 2 p.m. ET, the Dow was down 0.1% and the S&P 500 was also trading down 0.1%.

Additionally, small cap stocks (as measured by the Russell 2000 Index) also posted losses, falling 0.2%. Finally, down 0.3%, the Nasdaq suffered losses.

Nasdaq and NYSE volume was lower than Friday at this time.

The price of crude oil futures jumped 3.3%. As of Monday afternoon, the commodity was trading at around $96.12 a barrel.

The yield on the 10-year Treasury note also jumped, hitting 3.11% after a strong week prior.

After a significant drop last week, stocks struggled to rally on Monday.

Markets plunged on Friday after Federal Reserve Chairman Jerome Powell made aggressive comments in Jackson Hole, Wyoming.

The major indices had their best month since the end of 2021 in July, and August has started well so far.

To make matters worse, the resistance of the 200-day moving average came into play around the middle of the month, leading to a sharp decline.

This week, the 50-day moving averages will be tested for the major indices.

As the market rose on Monday, energy companies led the way higher as tech stocks lagged. With a gain of 2.2%, the Energy Select SPDR (XLE) sector is building the right half of a cup base at the 93.41 price level.

Winners: Netflix and Pinduoduo

Netflix (NFLX) rose 1.6% on exchanges other than the Dow Jones.

Bloomberg reported that the streaming platform could price its ad-supported tier between $7 and $9, sending the stock price skyrocketing.

The most popular ad-free plan now costs $15.49 per month, but the soon-to-launch ad-supported service will cost less.

After a tough 2021, when a series of bad quarters caused a big leak from shareholders, Netflix stock has struggled so far in 2022.

However, with a loss of just one million subscribers in the quarter ending in June, instead of the two million expected, the company’s financial report for July gave cause for optimism.

In contrast, Pinduoduo (PDD) rose more than 16% after the China-based e-commerce business posted excellent quarterly profits.

During the afternoon session, the shares briefly traded above a buy target of 68.81 before falling back. The stock has only fallen 2% since its entry point.

Pinduoduo recorded a 36% increase in revenue year over year.

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