Dow Jones Surges On Key Inflation Data; Amazon Dives, Apple Jumps On Earnings

The Dow Jones Industrial Average rallied Friday on another dose of inflation data, the personal consumption expenditure index. Amazon stock plunged on a weak sales outlook, while Apple, Intel and Chevron shares all climbed on earnings beats.

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Amazon (AMZN) shares crumbled nearly 10% after the company reported third-quarter results late Thursday that beat on earnings but gave an outlook that fell short. Apple (AAPL) stock rallied more than 4% in morning trade. Late Thursday, the tech titan beat Wall Street’s targets for its fiscal fourth quarter thanks to strong iPhone and Mac computer sales.

Meanwhile, the Federal Reserve’s preferred inflation gauge came out Friday morning at 8:30 a.m. ET. The PCE price index rose 0.3% for the month of September, in line with estimates. Year over year, the PCE index climbed 6.2%, cooler than the 6.3% estimate. Personal income rose 0.4% in September, just above estimates that called for a 0.3% rise.

The PCE price index is one measure of U.S. inflation, tracking the change in prices of goods and services purchased by consumers throughout the economy.

Stock Market Today: Chevron, Intel Earnings

Other key earnings movers Friday were Dow Jones stocks Chevron (CVX) and Intel (INTC), along with energy giant Exxon Mobil (XOM) and renewables leader First Solar (FSLR).

Chevron stock rose 1.9%, while Intel shares jumped 8% after beating lowered expectations for the third quarter and slashing its outlook for the fourth quarter. Exxon shares gained about 2%. And First Solar stock rose more than 2% despite missing earnings and revenue targets.

Electric-vehicle giant Tesla (TSLA) traded down around 2% Friday morning, while Dow Jones tech leader Microsoft (MSFT) was higher after today’s stock market open.

AutoZone (AZO), Cardinal Health (CAH), Eli Lilly (LLY) and Texas Roadhouse (TXRH) — as well as Dow Jones stocks Merck (MRK) and UnitedHealth Group (UNH) — are among the top stocks to buy and watch. Keep in mind that the new stock market rally is the perfect time for investors to put their watchlists into action, and to hone their pyramiding technique.

Young rallies, particularly those fighting bear markets, often fail. Pyramiding provides a method of moving into new stock positions incrementally, in order to minimize risk to capital.

Cardinal and Texas Roadhouse are IBD Leaderboard stocks. UnitedHealth was featured in this week’s Stocks Near A Buy Zone column, along with three other top stock ideas.

Dow Jones Today: Treasury Yields, Oil Prices

After Friday’s opening bell, the Dow Jones Industrial Average rose 1.3%, while the S&P 500 futures moved up 0.7%. The tech-heavy Nasdaq composite gained 0.8% in morning action, with Amazon trading at the bottom of the list.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) traded up 0.2%, and the SPDR S&P 500 ETF (SPY) rose 0.5%.

The 10-year Treasury yield ticked higher to 4.01% Friday morning, cutting into this week’s losses. On Monday, the 10-year Treasury yield closed at 4.23%, settling at its highest level since June 2008 before falling the following three sessions. The 10-year Treasury yield is set to snap a 12-week win streak.

Meanwhile, U.S. oil prices declined more than 1% Friday, threatening to end a four-day win streak. West Texas Intermediate futures traded below $88 a barrel.

Stock Market Rally Continues

On Thursday, the Dow Jones Industrial Average rallied 0.6%, while the S&P 500 fell 0.6%. The tech-heavy Nasdaq composite lost 1.6%.

Thursday’s The Big Picture commented, “Investors should continue to track companies that handily beat earnings results and have strong upside reactions, like Enphase Energy (ENPH), which was Wednesday’s IBD Stock Of The Day. They could be among the stock market’s leaders if the market is able to shrug off its recent losses and move higher.”

Now is an important time to read IBD’s The Big Picture column. Following last week’s powerful gains, investors want to put their curated watchlists to work, in order to jump on future breakouts. But not all follow-throughs work, so it’s important to raise exposure slowly and methodically, as the new uptrend proves itself.

Check out IBD Stock Lists, like the IBD 50 and Stocks Near A Buy Zone, for stock ideas.

Five Dow Jones Stocks To Buy And Watch Now

Dow Jones Stocks To Buy And Watch: Merck, UnitedHealth

Merck is extended beyond a double bottom’s 93.12 buy point after reporting a solid third-quarter beat on Thursday. The 5% buy area went up to 97.78. Merck shares traded a fraction lower Friday.

Health care giant UnitedHealth is approaching a cup-with-handle’s 553.23 buy point, according to IBD MarketSmith pattern recognition. Shares fell 0.25% Thursday, holding just shy of the stock’s latest entry.

UNH stock was up 0.4% Friday morning.

4 Top Growth Stocks To Watch In The Current Stock Market Rally

Top Stocks To Buy And Watch: AutoZone, Cardinal, Eli Lilly, Texas Roadhouse

Auto parts leader and recent IBD…