Futures: what to do before inflation data, Powell's speech

Futures: what to do before inflation data, Powell’s speech

Dow Jones futures were higher ahead of Tuesday’s open after the Dow Jones Industrial Average sold nearly 500 points on Monday. Investors will soon turn their attention to Wednesday’s speech from Fed Chairman Jerome Powell, as key inflation data is due out on Thursday.


Monday’s stock market weakness was due to a combination of the spread of Covid-19 protests in major cities across China and St. Louis Federal Reserve Chairman Jim Bullard’s comments on interest rates. .

In a webcast interview with MarketWatch, Bullard responded to a question about how long he expects the fed funds rate to stay in the 5% to 7% range, saying “I think we will have to stay there throughout 2023 and into 2024.”

Bullard believes that the markets are still underestimating the extent to which the Fed will have to maintain a tight policy in order to control inflation. Traders are placing a 72% chance of a 50 basis point rate hike, up from 80% a week ago, at the next central bank meeting, according to the CME’s FedWatch tool.

Earnings reports this week include CrowdStrike (CRWD), General dollar (DG) and Intuitive (INTU). Dow Jones stock is also included Selling power (CRM), as well as Snowflake (SNOW), Ultimate beauty (ULTA) and Working day (WDAY).

stock market today

On Monday, the Dow Jones Industrial Average lost 1.45%, or 497 points, and the S&P 500 fell 1.5%. The tech-heavy Nasdaq composite fell 1.6%. Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 1.5% and the SPDR S&P 500 (SPY) fell 1.6%.

Solar stocks sold off sharply on Monday as an analyst downgraded First Solar (FSLR) has had an impact on the rest of the industry. FSLR stock fell 3.4% after JPMorgan downgraded the stock from overweight to neutral due to the stock’s strong performance in recent weeks. Network technologies (ARRY) and Shoal technologies (SHLS) fell 7.1% and 6.4%, respectively. Array Technologies recently gave up a buy point, while SHLS stock fell back into a buy range above a buy point of 28.57.

Electric vehicle giant You’re here (TSLA) traded a fraction higher on Monday. Among Dow Jones stocks, Apple (AAPL) traded down 2.6% and Microsoft (MSFT) fell 2.3% in the current stock market.

IPO Leader Array Technologies, IBD Leaderboard stock Arista Networks (A NET), Celsius (CELH) and Chubb (CB) — as well as the names of the Dow Jones Boeing (BA), caterpillar (CAT) and Chevron (CVX) – are among the best stocks to buy and watch.

Arista Networks is an IBD Leaderboard Stock and was recently an IBD Stock of the Day. Boeing is an IBD SwingTrader stock and was one of four leaders featured in this week’s Stocks Near A Buy Zone column. Celsius was Monday’s IBD 50 Stocks To Watch pick.

4 most important growth stocks to buy and watch in the currentrStock market rally

Dow Jones Futures Today: Treasury Yields, Oil Prices

Ahead of Tuesday’s opening bell, Dow Jones futures rose 0.1%, while the S&P 500 gained 0.15%. Tech-heavy Nasdaq 100 futures rose 0.2% from fair value. Remember that overnight action on futures contracts on Dow Jones and elsewhere does not necessarily translate into actual trading in the next regular trading session.

The 10-year Treasury yield rose to 3.7% on Monday, holding near recent lows. On Friday, the 10-year Treasury yield closed at 3.69%, its lowest close since Oct. 4. Meanwhile, U.S. oil prices reversed after hitting their lowest level since December 2021. West Texas Intermediate futures were trading around $77 a barrel.

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What to do during the stock market rally

Now is an important time to read IBD’s The Big Picture column with the stock trend back in a “confirmed uptrend”.

While it’s good to make money work in today’s stock market, keep your exposure on the conservative side with small positions to start with. Just because the stock market is in a confirmed uptrend doesn’t mean you have to be 100% invested. And don’t be afraid to take a 10% gain if you have it, given the choppy nature of the market.

(Check out IBD stock listings like the IBD 50 and stocks near a buy zone, for additional stock ideas.)

Five Dow Jones Stocks to Buy and Watch Now

Dow Jones Stocks to Buy and Watch: Boeing, Caterpillar, Chevron

Aircraft maker Boeing fell 3.7% on Monday, falling back below the 173.95 cup basis buy point. Look for a decisive rally in this entry before considering a purchase of Boeing shares.

Caterpillar, a member of the Dow Jones, is about to take over the 238 point of purchase from its cutter base, according to IBD MarketSmith pattern recognition, and is less than 2% lower at entry. CAT stock, heavily exposed to China, fell 1.4% on Monday.

The CAT stock boasts an impressive 96 out of a perfect IBD composite score of 99, according to the IBD stock balance sheet.

Energy giant Chevron fell 2.9% on Monday, dropping its buy point of 182.50 in a consolidation basis.

Top stocks to buy and watch: Array, Arista, Celsius, Chubb

Solar leader and IPO stock Array Technologies shed its buy point of 22.40 in a cup with handle during Monday’s fall, according to IBD MarketSmith pattern recognition. Shares are about 3% below entry. Further weakness would trigger the sell rule reducing losses by 7% to 8%.

IBD Leaderboard Arista Networks stock remains in the buy range above the buy point of 132.97 from a choppy base despite Monday’s 1.5% loss.

Energy drink maker Celsius fell 1.3% on Monday as the stock continues to form a cup base with a buy point of 118.29. Monday’s weakness could be the start of a potential handle that offers a lower entry.

Chubb is trading just below the 216.10 one-cup buy point with a handle on Monday after the session’s slight losses. The 5% buy zone will peak at 226.91.

Join IBD experts as they analyze the top stocks of the current stock market rally on IBD Live

Tesla Stock

Tesla stock rose slightly on Monday, but remains well below its 50- and 200-day moving average lines. The shares are around 55% off their 52-week high.

Last week, the stock hit its lowest level since November 23, 2020, hitting a new 52-week low at 166.19.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares sold 2.6% on Monday, falling below their 50-day support level. Apple iPhone Pro production could be 6 million units lower due to civil unrest and Covid restrictions in China, according to reports. The stock is more than 20% off its 52-week high.

Bloomberg reported that unrest at the Foxconn factory in Zhengzhou could lead to a shortfall of 6 million units in iPhone Pro production in 2022. And that number could increase if Covid restrictions are extended for a few more weeks, according to sources. The Zhengzhou factory manufactures the vast majority of iPhone 14 Pro and Pro Max smartphones.

Microsoft slipped 2.3% on Monday, falling for a second consecutive session. Stocks continue to hold above the 50-day line. The software giant remains around 30% off its 52-week high.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen to learn more about growth stocks and the Dow Jones Industrial Average.


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