Dow Jones Reverses Higher As Nasdaq Leads Upside; Amazon, Snap Stock Soar On Earnings

The Dow Jones Industrial Average reversed higher Friday while the Nasdaq traded sharply higher and led the market. Investors digested a strong January jobs report and positive earnings from Amazon.com (AMZN), which jumped over 15% in afternoon trading.

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At around 1:30 p.m. ET, the Dow Jones industrials were up 0.1% while the Nasdaq composite gained 1.8% to lead the upside. The S&P 500 advanced 0.8%.

The consumer discretionary sector led the upside on Friday, up around 3%. Financial and energy sectors also outperformed, with gains of nearly 2% each. Materials and consumer staples were among the sectors leading the downside.

The Russell 2000 rose 0.4% as small caps fared decently well on Friday after underperforming the market recently. Volume was running lower on the Nasdaq and higher on the NYSE vs. the same time Thursday. The Innovator IBD 50 ETF (FFTY) traded down 0.1% as growth stocks struggled.

After pausing on Thursday, the indexes appear to be continuing their move to the upside. IBD’s market outlook earlier this week moved up to “confirmed uptrend,” and so far the uptrend remains intact.

In economic news, the Labor Department reported that U.S. employers added 467,000 jobs in January. Job gains were far above the 150,000 economists had expected. Additionally, December job gains were revised sharply higher, from 199,000 in the initial report to 510,000. This indicates the economy is managing labor shortages and the effects of the omicron variant.

The January unemployment rate moved up to 4%, vs. estimates of 3.9%. Average hourly wage growth of 0.7% in January topped expectations for a 0.5% increase.

Amazon, Snap Stock Pop On Earnings

Amazon.com jumped over 15% after the company announced mixed fourth-quarter results. The company’s bottom line beat expectations but top line missed estimates. Adjusted earnings of $27.75 a share increased 97% from a year ago, as revenue of $137.4 billion marked a 9% increase. The stock saw heavy volume, a bullish sign.

Elsewhere, Snap (SNAP), parent company of Snapchat, rocketed 48% after beating fourth-quarter expectations and guidance forecasts. The company recorded its first-ever profitable quarter with EPS of 22 cents a share. Revenue jumped 42% to $1.3 billion.

The stock fell over 4% on Thursday after a disappointing earnings report from Facebook parent Meta Platforms (FB) hindered social media stocks. However, Snap easily recovered its prior day losses and reclaimed its 21-day line as well. The stock climbed to the highest point since Jan. 14.

Ford Motor (F) traded sharply lower, down 10%, after missing earnings and revenue estimates for the final quarter of 2021. The automaker also warned that chip shortages and supply challenges will continue in early 2022.

Management’s warning about “ongoing” supply-chain disruptions comes ahead of what one analyst called Ford’s launch of the decade. The first electric version of its bestselling pickup truck, the F-150 Lightning unveiled last May, is due to arrive in showrooms this spring.

Oil And Gas Stocks Show Continued Strength

The energy sector continues to provide good set-ups and possible buy opportunities. On Friday, Coterra Energy (CTRA) broke out from a cuplike base. The U.S. exploration and production company is in buy range from the 23.74 buy point.

Matador Resources (MTDR) bounced off support at the 50-day line and regained the 47.33 buy point Friday, but shares faded in afternoon trading. The chart shows the relative strength line is nearing highs, a bullish sign.

Both firms are part of the U.S. oil and gas exploration and production industry group, which ranks a lofty No. 3 out of the 197 groups IBD measures.