Dow Jones futures were higher ahead of Tuesday’s open and the US election results. Key inflation data, including the consumer price index, is expected to be released later in the week.
Republicans almost certainly will take over the House of Representatives in Tuesday’s midterm elections. They seem to have the advantage to win the Senate, although it’s less clear. Democrats currently have a slim majority in the House, with Vice President Kamala Harris holding the deciding vote in the Senate 50-50.
Published Thursday, the consumer price index should increase by 0.7% in October compared to the previous month. Consumer inflation is expected to rise 8% year-on-year.
FANG stock traded a fraction lower in the extended trade, while Lyft stock plunged more than 16%. Mosaic shares rose slightly. And shares of Shockwave lost more than 5%.
stock market today
On Monday, the Dow Jones Industrial Average advanced 1.3%, or more than 400 points, and the S&P 500 gained 1%. The tech-heavy Nasdaq composite climbed 0.85%.
Among the best stocks to buy and watch, Albemarle (ALB), IBD classification watch list stock Arista Networks (A NET), CF Industries (CF) and New Fortress Energy (ENF) – as well as the Dow Jones names Merck (M.K.R.) and UnitedHealth Group (A H) – are among the best stocks to buy and watch.
Dow Jones Futures Today: Treasury Yields, Oil Prices
Before Tuesday’s opening bell, Dow Jones futures, as well as S&P 500 and Nasdaq 100 futures, were little changed from fair value. Remember that overnight action in Dow Jones Futures and elsewhere does not necessarily translate into actual trading over the next stock Exchange session.
The 10-year Treasury yield rose to 4.21% on Monday, extending a four-session winning streak and closing at its highest level since Oct. 24. Meanwhile, US oil prices fell nearly 1% as West Texas Intermediate futures traded near $92 a barrel. . Last week, WTI futures hit their highest level since mid-October.
Third quarter earnings Season
Earnings reports are driving many of the biggest moves in stocks, and they require close attention. Strong earnings can fuel major stocks above new buy points and into buy zones, while a less-than-impressive news can push stocks below key support levels.
The stock market’s reaction to an earnings release can often tell you more than the earnings themselves. If results look strong but the stock still slips, investors may worry about the sustainability of growth, rising costs, or other potential negative effects.
With the market in rally mode, investors should follow companies that easily beat earnings results and have strong upside reactions. These stocks could be among the new leaders if the market manages to rebound from its recent losses.
What to do in the struggling stock market rally
This is an important time to read IBD’s The Big Picture column after the stock market trend changed from a “confirmed bullish trend” to a “pressured bullish trend”.
At this point, investors should play defensive; don’t let profitable trades turn negative. As The Big Picture reiterated last week, it makes sense to keep exposure at 20% or less until the uptrend resumes.
But now is not the time to walk away completely. The uptrend is still intact, so investors can still buy breakouts but should focus on stocks with top-notch fundamental and technical metrics.
Dow Jones stocks to watch: Merck, UnitedHealth
Healthcare giant UnitedHealth continues to watch a cup with a 553.23 handle point of purchase, according IBD MarketSmithafter last week’s escape attempt. Shares rebounded 1.3% on Monday, closing about 1% below the stock’s last entry.
Top stocks to buy and watch: Albemarle, Arista, CF, New Fortress
Lithium producer Albemarle builds the right side of a cup base that has a buy point of 308.34. Shares rose 0.5% on Monday, extending a three-session winning streak.
CF Industries is trying to find support around its 50-day moving average amid Monday’s 1% loss. Stocks are building a cut base which has a buy point of 119.70, according to IBD MarketSmith pattern recognition.
New Fortress Energy is rapidly approaching the buy point of 63.16 from a cut basis. With the stock around 6% off new highs, keep an eye out for a handful to offer early entry. The energy leader released results Monday evening, triggering a 1.5% gain on the day.
Tesla Stock slipped 5% on Monday, hitting a new 52-week low and hitting its lowest level since June 2021.
Stocks are more than 50% off their 52-week high and significantly below their 50- and 200-day moving averages.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones StocksApple shares rose 0.4% on Monday despite the the company warns that it has reduced iPhone 14 production due to Covid-19 restrictions in China. Apple stock ended a five-day losing streak but is still about 24% off its 52-week high.
Microsoft jumped 2.9% on Monday, continuing its rebound from Friday’s 52-week low. The software giant remains around 35% 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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