Dow Jones futures rose after a negative stock market turn on Monday ahead of the Netflix report due on Tuesday. Tesla earnings are expected on Wednesday.
Reporting Season Continues, Dow Jones Shares Post Reports IBM (IBM) and Johnson and Johnson (JNJ), along with Halliburton (HAL) and Lockheed Martin (LMT). IBM reported late Monday evening, while J&J, Halliburton and Lockheed will report early Tuesday morning.
Stock market today
On Monday, the Dow Jones Industrial Average fell 0.7% after gaining 1.1% at its intraday peak. The S&P 500 was down 0.8% after rising as much as 1.1%. And the Nasdaq high-tech composite shed 0.8% after gaining 1.5% in previous trading.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.85%, while the SPDR S&P 500 ETF (SPY) was down 0.8%.
Bank of America (BAC) edged up a few inches after second quarter results. Charles Schwab (SCHW) was down 1.5% despite a strong earnings report, while Goldman Sachs (GS) jumped 2.5% on better-than-expected earnings results.
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Tesla (TSLA) cut growth to 0.2% on Monday. Among the leaders of the Dow Jones Apple (AAPL) shed 2.1% on reports that the company plans to slow hiring and spending growth next year to brace for a potential recession. Microsoft (MSFT) today the stock market fell by 1%.
In volatile stock market conditions, leaders Dow Jones Johnson & Johnson, Merck (MRK) and UnitedHealth (UNH) – and also dollar Wood (DLTR), Northrop Grumman (NOC), Quanta Services (PWR) and Verra Mobility (VRRM) – stocks worth watching. Keep in mind that the current stock market volatility is a reason to be more defensive.
UnitedHealth is on the IBD leaderboard. Dollar Tree is IBD SwingTrader stock. Quanta became IBD’s stock of the day on Thursday. This week, Verra was featured in the “Stocks Near the Buy Zone” column.
Dow Jones Futures Today: Treasury Bond Yields, Oil Prices
After Monday’s close, Dow Jones futures were up 0.1% relative to fair value, while S&P 500 futures were up 0.2%. Nasdaq 100 futures were up 0.2% compared to fair value. Remember that overnight action in Dow futures and elsewhere does not necessarily translate into real trading in the next regular stock market session.
The 10-year Treasury yield rose on Monday to close at 2.96%. Meanwhile, U.S. oil prices are up nearly 5%, with West Texas Intermediate oil trading above $99 a barrel.
stock market rally
Individual stock performance has mostly improved in recent trading sessions, which is a good start in a struggling stock market rally. However, be more conservative and keep your positions small when it comes to new purchases. Don’t increase exposure too quickly, especially under conditions of uncertainty. Monday’s sharp reversal further confirms the challenging environment in which progress can be made.
Friday’s The Big Picture column commented: “The Nasdaq Composite is up 1.8% and looks ready for another rendezvous with its 50-day moving average. Stock market bulls want the index back above this key level. The rally could pick up even more momentum.”
If you’re new to IBD, consider taking a look at its stock trading system and the basics of CAN SLIM. Recognizing chart patterns is one of the keys to investment guidance. IBD offers a wide range of growth stock listings such as Leaderboard and SwingTrader.
Investors can also create watchlists, find companies close to the point of purchase or design their own screens in IBD MarketSmith.
Four Dow Jones stocks to watch now
Dow Jones earnings: IBM, Johnson & Johnson
IBM reported better-than-expected results for the second quarter late on Monday. But the stock fell more than 3% in extended trading. The company reported adjusted earnings of $2.31 per share on revenue of $15.5 billion. Analysts had expected adjusted earnings of $2.27 on revenue of $15.1 billion. Shares of IBM closed about 5% below their 52-week high.
According to IBD MarketSmith chart analysis, Dow Jones leader Johnson & Johnson remains below the 181.84 double bottom buy point after falling 2.2% on Monday. This was announced by the company at the beginning of Tuesday.
Dow Jones stocks to watch: Merck, UnitedHealth
Pharmaceutical giant Merck shares fell 2.8% on Monday, about 3% below its unchanged buy base point of 95.02.
Shares of health insurance giant and IBD Leaderboard UnitedHealth are in a buying range above the buy point of their double-bottom base at 518.80 after falling 2% on Monday.
Shares of UNH post a strong 96 out of a perfect 99 IBD Composite Rating according to the IBD Stock Checkup. Investors can use the IBD Composite Rating to easily assess the quality of a stock’s fundamental and technical performance.
The 4 Best Growth Stocks to Watch in the Current SituationRstock market rally
Top stocks to watch: Dollar Tree, Northrop, Quanta, Verra
Shares of IBD SwingTrader Dollar Tree advanced above the 166.45 buy point on Monday, gaining 0.9%. On the other hand, discount retailer RS’s line is right at new highs. Dollar Tree stock posted a strong 97th out of a maximum of 99 combined IBD ratings, according to an IBD stock review.
Shares of Northrop Grumman fell below their key 50-day line, continuing to form a flat base with a buy point of 492.40. NOC shares fell 2.6% on Monday.
According to IBD MarketSmith’s chart analysis, Quanta Services is finalizing a cup and handle that has a buy point of 138.56. The stock is about 8% from its last entry after losing 0.8% on Monday.
Verra Mobility is trying to break the cup-and-handle buy point of 16.83. The stock briefly topped entry early Monday but closed just below its buy point. The stock RS line continued to show tremendous strength, hitting a new high on Monday.
Join IBD experts as they analyze the leading stocks in the current stock market rally on IBD Live.
Income from Netflix
Netflix earnings are due to be released late Tuesday night. The company is expected to earn $2.96 per share, which is flat year-over-year on sales of about $8.03 billion. Revenue is expected to grow 9% year on year.
Last quarter, the company forecast a loss of 2 million subscribers in the June quarter amid rising prices and increased competition. Wall Street analysts now expect the video streamer to lose 1.72 million subscribers in the second quarter.
Shares of Netflix closed on Monday more than 70% below their 52-week high.
Tesla shares rose 0.2% on Monday, extending the winning streak to four sessions. The stock is trying to recover its 50-day line decisively, but remains deep below its 200-day line. Tesla shares traded at 1243.49 on November 4th. Shares are down about 42% from that all-time high.
The electric car giant’s earnings are due on Wednesday after the stock market closes. Analysts expect earnings to rise 28% to $1.86 per share on revenue of $16.5 billion.
Tesla delivered 254,695 vehicles in the second quarter, roughly in line with Wall Street’s undervalued estimates. FactSet analysts expect shipments to pick up in the second half of 2022, with chip shipments slowly increasing. Wall Street predicts that Tesla will produce 1.4 million units by the end of the year.
Dow Jones leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares fell 2.1% on Monday, snapping a two-day winning streak. Apple remains above its 50-day line after being bullish in recent weeks. The stock remains well below its long-term 200-day line. The stock is about 20% below its 52-week high. Apple’s earnings are due on July 28th.
Microsoft shares fell 1% on Monday, once again meeting resistance near the 50-day line. Shares closed about 27% below their 52-week high. The software giant will report quarterly results on July 26.
Don’t forget to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.
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