Dow Jones falls amid British pound turmoil; Elon Musk Twitter Battle Takes Off; Bitcoin rally

The Dow Jones Industrial Average fell as interest rates rose amid further turmoil for the British pound. A further step was taken in the ongoing legal battle between Tesla (TSLA) CEO Elon Musk and Twitter (TWTR). Coin base (COIN) and Riot Blockchain (RIOT) increased as Bitcoin increased.

Meanwhile, former Leaderboard stock Planet Fitness (PLNT) appeared on an upgrade, and Hershey (HSY) and JM Smucker (SJM) showed strength near buy points.

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Volume was lower on both Nasdaq and the New York Stock Exchange compared to the same time on Friday.

The interest rate on the benchmark index for 10-year government bonds rose by 19 basis points to 3.89%. West Texas Intermediate crude fell nearly 3% to below $77 a barrel.

Unrest in the British pound hits US markets

The British pound continued to struggle following a tax cut and stimulus plan by the new UK Chancellor Kwasi Kwarteng. A single pound sterling fell as low as $1.04 in pre-dawn trading on Monday.

“The Bank is monitoring financial market developments very closely in light of the significant repricing of financial assets,” Bank of England Governor Andrew Bailey said in a statement.

The pain hit US stocks, said Oanda senior market analyst Edward Moya.

“US stocks are struggling given the turmoil happening to UK financial markets,” he said in a note to clients. “The volatility in currency is extreme and it will be a major headache for multinationals.”

He also said that Wall Street “rejects the chancellor’s plan that does not get hold of public finances”.

Dow Jones Dips; Small Cap Struggle

The Dow Jones fell more than 300 points, or 1.2 percent. The Nasdaq was the best performer of the indices, falling 0.5%. The S&P 500 also lagged behind, falling 1.1%.

The S&P 500 sectors were largely negative. Property and utilities struggled the most, while consumer approved and staples fared best.

Small caps were crushed by the bears, with the Russell 2000 dropping 1.4%.

The Innovator IBD 50 ETF (FFTY), a watch for growth stocks, fell 1.2%.

Dow Jones Today: Apple Stock, Walmart Shine

Only a couple of stocks were in positive territory on the Dow Jones Industrial Average.

apple ( AAPL ) managed a gain of 0.1%. Walmart (WMT) was the best performer, gaining 0.3%.

On the downside, insurance plays Travelers (TRV) fell more than 3% and Boeing (BA) stumbled almost 3%.

Elon Musk Twitter Battle Takes Off; Tesla wins

Tesla CEO Elon Musk is set to begin a multi-day deposition with Twitter’s lawyers on Monday.

Musk will take questions on Monday and Tuesday. The grilling can also extend until Wednesday. The Tesla boss is trying to back out of a deal to buy the social media company for $54.20 a share.

Musk claims he was misled about the number of spam and bot accounts on the platform. The formal trial begins on October 17.

Meanwhile, critics have called for a production shutdown at Tesla’s Giga Berlin factory after a cardboard fire. It took around 50 firefighters to extinguish the fire.

Twitter shares fell almost 2% due to major market pressure. It has fallen back below its 50-day line.

Tesla storage was worse for the day but remained positive. It is trying to retrace a consolidation pattern with an entry at 314.74.

Revenues have grown an average of 173% over the past three quarters, well above CAN SLIM requirements. Annual results are also impressive, with three-year EPS growth of 197%.

Coinbase Stock, RIOT Up As Bitcoin Rallies

A rally in the price of Bitcoin helped cryptocurrency stocks. Bitcoin was up more than 1%, trading just above the $19,000 mark.

Coinbase got a boost, rising nearly 2%, although volume was light. The stock, which cut its full-year forecast last month, remains below its major moving averages.

The COIN share is down around 75% since the beginning of the year.

Other cryptocurrency games also increased. Grayscale Bitcoin Trust (GBTC) was up more than 1%, while the Bitcoin mining game Riot Blockchain (RIOT) vaulted more than 5%.

Formerly managing Planet Fitness Pops

One of today’s top performers was former Leaderboard stock Planet Fitness. It fell more than 2% in high volume.

The budget training chain has been hammered by the effects of Covid-19. But Raymond James sees better times ahead, and upgraded the stock to “Strong Buy” from “Market Perform”.

The firm highlighted the company’s “flexible and recession-proof business model” and expects “healthy growth” next year.

The analyst also said the firm has “no interest rate risk and very little short-term debt maturities” and is well below the historical average.

However, Planet Fitness has a lot of work to do before it is attractive to CAN SLIM investors. It is currently below all the major moving averages.

Outside the Dow Jones: These 2 stocks are showing strength

JM Smucker continues to impress in the midst of a tough market. Its relative strength line once again reached new heights.

This comes as it sees a cup-with-handle entry of 150, according to MarketSmith analysis. It is clear for the main moving averages.

The packaged food game is in the top 7% of stocks in terms of price performance over the last 12 months. It’s a double threat as it also offers investors an attractive dividend yield of 2.9%.

Chocolate icon Hershey also flexed its muscles, eyeing a 234.66 flat-base entry point. The RS line climbed to a fresh high.

Earnings are a key strength, with Hershey’s EPS rating at a healthy 92 out of 99. Overall, 43% of shares are held by mutual funds, according to MarketSmith data.

Follow Michael Larkin on Twitter at @IBD_MLarkin for more growth stock analysis.

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