Dow Jones Dips, Nasdaq Hits Record; Biden Admin Defends Tax Hike; Tesla Up With Earnings Due - Investor's Business Daily

The Dow Jones Industrial Average slipped as the Biden Administration defended its plan to significantly raise the capital gains tax rate for wealthy Americans, however the Nasdaq hit a new closing high. American Express (AXP) was the leading blue chip, and managed to scramble past a buy point. Tesla (TSLA) fell after hours despite beating on the top and bottom lines.

Meanwhile, a host of growth stocks were breaking out, including Skyworks Solutions (SWKS), decking specialist Trex (TREX) and Horizon Therapeutics (HZNP), a half size position on Leaderboard.

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Biden Administration Defends Capital Gains Tax Hike

The Biden Administration spoke out in defense of its plan to raise the capital gains tax rate. Bloomberg has reported it could rise as high as 43.4% for rich Americans. The measure is part of the upcoming American Families Plan.

Speaking at a White House briefing Monday, National Economic Council Director Brian Dees told reporters that there is no indication raising the capital gains tax on the wealthiest Americans will stop them investing into the economy.

"Our view and reading of the evidence is there is not a correlation that would significantly affect investment for these highest income individuals," he said.

Dees, who previously served as a senior advisor to President Barack Obama, also told reporters the money that is brought in through an increase in the tax rate can be put to good use elsewhere.

"We can use those resources to invest in areas where that we know where there is convincing academic evidence, empirical evidence," he said. "That investments, for example, in early childhood and in our children return enormous dividends in terms of their own academic success, reduced costs in the health care system, productivity and growth in the future."

Nasdaq, S&P 500 Rally

The Nasdaq was the leading major index, and made a new closing high after rising around 0.9%. Top gainers included DocuSign (DOCU) and Xilinx (XLNX), with both gaining more than 4%.

U.S. Stock Market Today Overview
Index	Symbol	Price	Gain/Loss	% Change
Dow Jones	(0DJIA)	33981.97	-61.52	-0.18
S&P 500	(0S&P5)	4187.74	+7.57	+0.18
Nasdaq	(0NDQC )	14138.78	+121.97	+0.87
Russell 2000	(IWM)	228.09	+2.33	+1.03
IBD 50	(FFTY)	47.82	+1.13	+2.42
Last Update: 4:06 PM ET 4/26/2021

The S&P 500 was also making strides, though its gain was a slender 0.2%. Big movers here included Otis Worldwide (OTIS) and mining stock Freeport-McMoRan (FCX). Both were up around 7%.

The S&P sectors were mixed. Energy and consumer discretionary performed best, while consumer staples was the biggest laggard.

Small caps did well, with the Russell 2000 outperforming the major indexes. It rose around 1% on the stock market today.

However growth stocks performed even better. The Innovator IBD 50 ETF (FFTY) gained around 2.4%.

Playboy parent PLBY Group (PLBY) led the IBD 50, posting a gain of 13%. It is now up 409% so far in 2021.

Dow Jones Lags As American Express Stock Passes Buy

The Dow Jones Industrial Average was the only major index to be in the red. It slipped around 0.2%.

American Express was the component faring best, gaining more than 4% and passing a buy point in the process.

It is currently just below its buy zone after breaking out of a seven-week cup with handle. The ideal buy point is 150.55, according to MarketSmith analysis.

Procter & Gamble (PG) was the biggest laggard, falling 2%. The firm recently unveiled plans to raise prices on some goods in September. The company said both materials and transportation were becoming more expensive.

Tesla Stock Rallies Ahead Of Earnings

Electric-car maker Tesla fell late after posting Q1 earnings. The stock had closed the day's trading 1.2% higher.

The firm posted EPS of 90 cents on revenue of $10.39 billion. Analysts expected EPS to rise 216% to 79 cents per share, according to Zacks Investment Research. Revenue had been seen charging 66% higher to $9.92 billion

It has formed a new new cup-with-handle base, and is aiming for a 780.89 buy point.

Tesla stock has an IBD Composite Rating of 92. Analysts see big earnings gains ahead in 2021 and 2022.

These Growth Stocks Pass Buy Points

A host of growth stocks were passing buy points in a fruitful day for breakouts.

Skyworks Solutions rose above a consolidation with a 195.92 buy point, according to MarketSmith analysis. The RS line is spiking, which is a positive.

Investors should note this is a fourth-stage base. Such late stage bases are less likely to succeed, according to IBD research. SWKS stock remains in the buy zone, and is buyable up to 205.71.

Trex also broke out, passing a cup entry of 107.74. Shares are up more than 2%, but remain inside a 5% buy zone. It is actionable up to 113.13.

The decking, railing and fencing products maker is up more than 30% since the start of 2021. Earnings are a key strength here.

Horizon Therapeutics passed a consolidation pattern buy point of 96.65. The stock has a good balance of earnings and stock market performance.

Camping World (CWH) gained 4.3% on Monday and broke out from a cup base with a 44.20 buy point.

The stock has been making excellent gains over the past 12 months, which is reflected in its 94 RS Rating.

The recreational vehicles seller is up more than 70% since the start of 2021, with consumers keen to try alternative vacation opportunities amid the Covid-19 pandemic.

Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.

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