Dow Jones futures were lower early Tuesday after tech stocks sold off sharply Monday, as President Biden picked Jerome Powell as Fed Chairman for a second term. Tesla stock rallied nearly 2% Monday, while Lucid Motors and Rivian skidded. And Zoom earnings beat estimates late.
On Monday, the Dow Jones Industrial Average moved up less than 0.1% after slashing gains. The S&P 500 turned 0.3% lower, while the Nasdaq sold off 1.3% after briefly hitting a new high.
Among the Dow Jones leaders, Apple (AAPL) rose 0.3% Monday, while Microsoft (MSFT) moved down 1% in today’s stock market. Nike (NKE) is right at a new buy point after a recent breakout attempt.
Electric-vehicle leader Tesla (TSLA) gained nearly 2% Monday. EV peer Rivian (RIVN) skidded over 8%, while Lucid Motors (LCID) descended over 7%. Chinese EV leaders Li Auto (LI) and Xpeng Motors (XPEV) are near buy points.
Among the top stocks to buy and watch, Alphabet (GOOGL), Amazon (AMZN), Apple and Nucor (NUE) are in new buy zones.
Microsoft, Nucor and Tesla are IBD Leaderboard stocks. Amazon was featured in this week’s Stocks Near A Buy Zone story. Apple is an IBD SwingTrader stock.
Ahead of the stock market open Tuesday, Dow Jones futures edged lower vs. fair value, while S&P 500 futures also inched lower. Nasdaq 100 futures lost 0.2% vs. fair value. Remember that extended and premarket action in Dow Jones futures and elsewhere doesn’t necessarily translate into actual trading performance in the next regular stock market session.
Among exchange traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) lost 1.2%, while the SPDR S&P 500 ETF (SPY) dropped 0.3% Monday. The Innovator IBD 50 (FFTY) tumbled nearly 5%, its biggest one-day decline since Sept. 28.
Early Monday, President Joe Biden announced that he is nominating current Chairman Jerome Powell for a second term. Fed Governor Lael Brainard will be nominated as vice chair. The announcement comes as the inflation rate has surged to a 30-year high and become a hot political issue. In response, the 10-year Treasury yield jumped above 1.62%, snapping a three-day losing streak.
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The stock market put in a poor performance Monday, as the Nasdaq and S&P 500 reversed lower after hitting new highs.
On Monday, The Big Picture commented, “In contrast, it was a brutal day for software stocks. Eight out of the bottom 10 industry group performers were in software, with Computer Software-Enterprise faring the worst.”
For daily stock market commentary, be sure to check out IBD’s The Big Picture.
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Coinbase (COIN) tumbled over 5%, but remains extended past a 280.71 buy point in a double bottom. The leading cryptocurrency exchange could be adding a handle to a large, deep cup base that spans back to the company’s April debut. COIN stock is still about 7% above its key 10-week moving average.
Roblox (RBLX) cratered nearly 11% Monday, reversing from all-time highs in huge volume. Shares remain about 16% above a 103.97 buy point in a consolidation.
Unity Software (U) declined 6.6% Monday and is already about 16% off Thursday’s all-time high at 210.
2020 stock market winner Zoom Video Communications (ZM) reported third-quarter earnings and sales results that topped estimates after the close Monday. Zoom earnings rose 12% to $1.11 a share on revenue of $1.05 billion. Analysts expected the company to earn $1.09 per share on sales of $1.018 billion, representing year-over-year increases of 10% and 31%, respectively. Zoom shares dived nearly 9% in premarket trade.
Zoom stock closed Monday about 50% off its 52-week high and sharply below its long-term 200-day line. The stock is also below its 50-day moving average.
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IBD SwingTrader stock Apple is out of the 5% buy range past a 153.27 buy point in a cup with handle, according to IBD MarketSmith chart analysis, following seven straight up days. The 5% buy zone tops out at 160.93. Shares pared sharp gains to just 0.3% Monday.
Dow Jones retail leader Nike bullishly regained its cup base’s 174.48 buy point amid Friday’s 2.1% rally. But shares gave up that buy point during Monday’s 0.4% loss.
Adobe is nearly extended past a 659.29 buy point in a cup with handle following a Nov. 4 breakout move, as shares jumped 2.6% Friday. ADBE stock reversed from early gains to drop 2.15% Monday.
Alphabet remains just above a 2,925.18 buy point in a flat base, according to IBD MarketSmith chart analysis, following Monday’s 1.8% loss. The 5% buy area runs up to 3,071.44.
Amazon gave up its 3,605.55 buy point in a cup with handle following Monday’s 2.8% decline. The IBD Stock Checkup shows that AMZN stock has a mild 83 out of a perfect 99 IBD Composite Rating.
The stock’s relative strength line is coming sharply off recent lows after November’s gains, but it is well below its July high. That indicates underperformance vs. the S&P 500 over a longer time frame. Ideally, the RS line should hit a new high on the breakout day or shortly thereafter to confirm the stock as a market leader.
IBD Leaderboard stock Nucor is trying to break out past a cup-with-handle’s 119.42 buy point amid Monday’s 6% advance. Leaderboard noted that the price action warranted a boost from a quarter-size position to a half.
Join IBD experts as they analyze leading stocks in the current stock market uptrend on IBD Live
Li Auto continues to build a cup with handle that shows a 34.93 buy point, but is falling further away from the entry. Shares rose nearly 2% Monday, bouncing after three straight days of losses.
Xpeng Motors continues to trade below its 48.08 buy point in a choppy cup base following Monday’s 1.1% rise. Early Tuesday, Xpeng will report its third-quarter earnings results. On Nov. 19, Xpeng unveiled its new G9 flagship smart SUV.
Lucid Motors shares dropped 7.4% Monday, giving back a part of Friday’s 17.3% surge. LCID stock remains far extended past a 28.49 buy point in a cup-with-handle base.
Hot initial public offering Rivian tumbled 8.2% Monday after Ford Motor (F) and Rivian decided to back away from a pact to build a specific electric vehicle.
RIVN shares closed Monday about 34% off their post-IPO highs. Remember that investors should be disciplined about buying new issues by waiting for an IPO base to form before considering a purchase. The recent weakness could be the start of its first base formation, but last week’s price action was not constructive given the huge downside reversal and high volatility.
Tesla stock rallied 1.7% Monday, adding to Friday’s 3.7% gain and extending a win streak to five sessions. Early Monday, CEO Elon Musk tweeted that the Model S Plaid — a 396-mile range luxury sedan that can reach top speeds of up to 200 miles per hour — could reach China “around March.”
Shares traded as high as 1,243.49 on Nov. 4, but the stock ended Monday about 7% off its 52-week high. TSLA shares remain sharply above a 764.55 buy point in a cup with handle, as well as earlier entries at 700.10 and 730. The chart also showed an alternate entry at 900.50.
Among the top Dow Jones stocks, software giant Microsoft moved down 1% Monday, reversing from the session’s new highs.
On Oct. 18, Microsoft stock broke out past a flat base‘s 305.94 buy point. The 5% buy zone tops out at 321.24, so the stock is extended.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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9:42 AM ET The market rally held key levels Wednesday, along with Tesla and many growth stocks. Fed officials hinted at a faster…
9:42 AM ET The market rally held key levels Wednesday, along with Tesla…
Amid supply-chain backups, high energy prices, surging rents and labor force shortages that are forcing big wage hikes even at huge employers like Amazon and Walmart. (Elizabeth Plumb/©lchumpitaz — stock.adobe.com)
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