Stock Market Today: Indexes Slip, But This Key Sector Rises | Stock News & Stock Market Analysis

U.S. stock indexes sagged midday Tuesday despite strong housing data and a looming House vote on the Republican tax-cut bill. The bill is expected to pass with no help from the Democrats.

X The Nasdaq retreated more than 0.4%, while the S&P 500 and the Dow Jones industrial average dipped 0.2% each. The small cap Russell 2000 was off nearly 0.2%.

Volume in the stock market today was below the previous session’s pace.

Among stock groups, the day’s strongest performers were in retail and oil-related. The laggards were toys, meat and solar stocks.

The retail sector has been showing strength recently. In the past two weeks, retail has provided a fair amount of daily new highs. For example, in Monday’s session, the retail sector had 21 new highs, trailing only the bank sector’s 26 new highs and the finance sector’s 30 new highs.

The restaurant group was up about 1.5% midday Tuesday.

Texas Roadhouse (TXRH) popped 1.31 to 53.99 Tuesday in volume running at a pace more than 30% above average.

The stock is in the 5% buy zone from a 52.65 early buy point in a six-week flat base. The standard entry is 53.71. The Street expects Texas Roadhouse’s Q4 earnings to jump 28%. This would be the best quarterly growth in five quarters.

Texas Roadhouse is No. 2 in the restaurant group in Stock Checkup at The No. 1 restaurant stock is Shake Shack (SHAK), but Shake Shack is too extended to buy safely.

Starbucks (SBUX) inched up 0.06 to 58.09 in average volume, but the stock could be setting up for a breakout. Starbucks has sketched a saucer-with-handle pattern. The potential buy point is 59.93, which is easiest to spot on the daily chart. One drawback is that Starbucks’ chart doesn’t show a prior uptrend of at least 30%. IBD research shows that for a base to be productive, a prior uptrend of at least 30% is needed.

Starbucks has been in a choppy, sideways pattern for about two years. The most recent breakout was in April and led to a 9% gain before the stock began its current consolidation.

Economic News

November housing starts came in at 1.297 million on an annualized rate, almost 5% more than expected. Permits rolled in at 1.298 million, or 2% better than expected. Homebuilder stocks did not react much to the news.

Redbook’s weekly gauge of same-store sales at discounters, chain stores and department stories rose 4.4% on a year-over-year basis.

Wednesday will include reports on MBA mortgage applications and existing-home sales. Thursday’s headline number will be the third take on Q3 GDP. The second-take reading was 3.3%.


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Originally posted 2017-12-19 17:49:32.


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