Some stock market gains fade after news of a rocket attack in Poland

The US stock market trimmed gains in afternoon trading on Tuesday. The indices slipped after reports on Twitter that two rockets hit a city in Poland.



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The Nasdaq composite was up 2.5% by midday but trimmed its gain to 0.6% by 1:40 PM ET. The S&P 500’s previous 1.5% gain had all but disappeared.

The S&P 500 is approaching the 200-day moving average. The line has been a resistance level for the index, particularly in April and August. See how the S&P handles the next test of the line, which is still down.

The 4,000 level is another major landmark for the S&P 500. The index ran into resistance on Friday and Monday. While it surpassed it today, the index was below 4,000 in afternoon trading.

The Dow Jones Industrial Average fell 0.5%.

The indices fell sharply after a report on the Faytuks News Twitter account he said two rockets hit the city of Przewodow in Poland, on the border with Ukraine. Two people were killed, the report said.

There has been no confirmation from US news outlets. The Wall Street Journal previously reported that Russian missiles have hit parts of Ukraine. Oil prices soared on the news.

Walmart, Home Depot report earnings

component Dow Jones Walmart (WMT) gaped up 7% after beating pre-market sales and profit estimates. The world’s largest retailer by revenue saw same-store sales climb 8.2% and also raised its guidance. Walmart surpassed its previous day’s best of July 7, 2020, when it jumped 6.7%, according to Dow Jones Market Data.

Another major Dow dealer, Home storage (HD) beat earnings and sales expectations for the quarter ended October and confirmed its forecast. The stock recorded an upside reversal of almost 1%.

The small-cap Russell 2000 was up 2.1%.

Electric Lincoln (LECO) is exiting a handleless cup base, but the volume on the welding system maker is light. The buy point is 148.60.

Volume increased on the NYSE and Nasdaq compared to the same time on Monday.

In other good news for the economy, October’s producer price index (PPI) rose 8% year-on-year and 0.2% from the previous month. Both readings were lower than expected by economists. Basic wholesale prices, which exclude food and energy, rose 6.7% year over year and were unchanged since September, according to the Bureau of Labor Statistics.

The report offers more evidence that companies are losing pricing power in a cooling economy, says Bill Adams, chief economist at Comerica Bank.

“But even after the good inflation news from the PPI report, the Fed is likely to take a pretty aggressive tone with its decision next month,” Adams said. “Home heating costs will be significantly higher this winter than last, which may be behind the rise in consumer inflation expectations reported by the New York Fed survey released yesterday. Inflation expectations in the survey also of the University of Michigan have increased in the past two months reports.”

The yield on the 10-year Treasury note fell 6 basis points to 3.8% in afternoon trading.

The stock market gets a boost from Chinese stocks

Chinese equities contributed to the rally in US equities.

The iShares MSCI China ETF (MCHI) was up 5.1% and the KraneShares China Internet ETF (KWEB) jumped 9.4%. The Shanghai Composite finished up 1.6%, while Hong Kong’s Hang Seng gained 4.1%.

President Joe Biden and Chinese leader Xi Jinping are meeting in Indonesia in hopes of improving a frayed relationship between the two countries. The initial reaction from both sides was optimistic.

The Innovator IBD 50 ETF (FFTY) is up 1% after lagging the stock market previously.

Flex LNG (FLNG) beat earnings and revenue expectations on strong demand in the liquefied natural gas market. Yet the stock is down more than 7% on heavy volume. Flex LNG is still forming a cup base with a buy point of 37.09.

The chips also stimulate the stock market

Lattice semiconductor (LSCC) led the IBD 50, jumping 6.7% to its highest price since January. Susquehanna raised the target price from 72 to 75.

Latex and other chip stocks appear to be up on Warren Buffett news Berkshire Hathaway (BRKB) has made its first purchase of Taiwan semiconductor (TSM) shares. Taiwan Semi gained 12%.

The Philadelphia semiconductor index is up nearly 4%.

Also in the IBD 50, steel producer Tenaris (TS) is passing the 34.19 buy point of a handle cup base. Medpace Holdings (MEDP) regained a buy point of 231.10.

On the downside, lithium producer livent (LTHM) slipped 7% in heavy volume. Other lithium stocks also declined.

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