Dow Jones futures tipped higher on Sunday night, while S&P 500 and Nasdaq futures fell slightly. Oil prices rose as Saudi Arabia cut oil production. Tesla, Apple, and Palo Alto Networks are in the spotlight.
X
Last week’s rally in the stock market was gaining momentum, with all major stock market averages rising sharply.
The market uptrend remains narrow, concentrated not only in chips and software, but also in artificial intelligence. Many of their stocks are extended. However, as market breadth continues to improve, it will create a wider range of buying opportunities.
already, Tesla (TSLA) broke out on Friday. Dexcom (DXCM), Renner (Len) and JP Morgan Chase (JPM) early entries were flushed later in the week. Marriott International (March) is probably viable as well.
All reflect areas of leadership potential.Tesla shares join EV rivals BYD (BYDDF) to clear purchase points. DXCM stock is one of several medical product securities looking to rise. LEN shares are rebounding again among many home builders. JPM shares stand out among financial stocks, but the sector is recovering. MAR shares are one of the broadly recovering travel sectors.
Investors should be looking to add more exposure in anticipation of a bullish shift. But be prepared to back down.
in the meantime, apple (AAPL) is expected to show off a mixed reality headset on Monday, making it its first new hardware product since the 2015 Apple Watch. This headset will go up against rivals such as Meta Quest in the US. meta platform (meta). Apple shares are nearing a January 2022 high and nearing a $3 trillion market cap.
In other news Palo Alto Networks (Panwoo) will join the S&P 500 amid a number of changes to the S&P index before it opens on June 20. PANW shares surged late Friday.
Added Tesla stock IBD Leaderboard Join Meta Stocks and Palo Alto Networks on Friday. PANW shares are IBD Big Cap 20. LEN stock joined SwingTrader on Friday. Renner was IBD Stock Of The Day on Friday.
dow jones futures today
Dow Jones futures rose 0.1% against fair value. S&P 500 futures were down 0.1% and Nasdaq 100 futures were down 0.3%.
Oil prices rose 1% and are already well below Sunday evening highs. Saudi Arabia will implement voluntary cuts of 1 million barrels per day for at least July. OPEC Plus, which consists of OPEC and its main allies such as Russia, formally agreed on Sunday to extend current output through 2024. Weaker-than-expected Chinese demand and Russian overproduction are pushing oil prices toward a 52-week low.
The 10-year U.S. Treasury yield climbed 3 basis points to 3.72%. Treasury bill rates rose a few basis points.
The Treasury Department is expected to auction about $170 billion in treasury bills on Monday after President Biden signed a deal to raise the debt ceiling on Saturday. There will be a large number of issuances in the coming weeks.
Note that overnight trading such as Dow Futures does not necessarily translate into actual trading in the next regular stock market.
IBD experts analyze hot stocks during the stock market rally on IBD Live.
stock market rise
Stock market gains showed a strong and broad rally, especially in the second half of the week.
The Dow Jones Industrial Average rose 2% in last week’s stock market trading. The S&P 500 index rose 1.8%. The Nasdaq Composite rose 2%. Small-cap Russell 2000 rose 3.3%.
The 10-year Treasury yield fell 13 basis points on the week to 3.69% before gaining 8 basis points on Friday.
US crude futures fell 1.3% to $71.74 a barrel last week after gaining 2.3% on Friday.
ETFs
Among Growth ETFs, Innovator IBD 50 ETF (FFTY) surged 3.6% last week, while the Innovator IBD Breakout Opportunity ETF (game) rose 1.7%. iShares Augmented Technology Software Sector ETF (IGV) rose 2.1%. VanEck Vectors Semiconductor ETF (SMH) fell 0.8%.
A stock that reflects a more speculative story, the ARK Innovation ETF (Arkuk) surged 6.45% last week, the ARK Genomics ETF (Argu) rose 4.9%. Tesla shares are the number one holding of all Ark Invest ETFs. Kathy Wood’s Ark also owns a portion of BYD.
SPDR S&P Metals & Mining ETF (XME) rebounded 4.2% last week. Global X US Infrastructure Development ETF (pave) popped at just over 3%. US Global Jets ETF (Jets) rose 3.1%. SPDR S&P Homebuilders ETF (XHB) rose 3.5%. Energy Select SPDR ETF (XLE) rose 1.4%. Healthcare Select Sector SPDR Fund (XLV) rose 2.2%. DXCM stock is XLV.
Financial Select SPDR ETF (XLF) rose 2.15% in the outer, upward week. JPM stock is the main component of XLF.
SPDR S&P Regional Banking ETF (KRE) rose 4.8%.
Top 5 Chinese stocks to watch right now
Apple Mixed Reality Headset
Apple will be showcasing its latest hardware and software innovations during its keynote at its annual Worldwide Developers Conference, which starts at 10 a.m. Pacific time on Monday. Learn more about the latest operating systems for iPhone, iPad, Mac, Apple TV, and Apple Watch. But all that talk is probably about a mixed reality headset called Reality Pro. This will be the first new hardware product since the Apple Watch debuted in 2015. An expected $3,000 price tag may deter buyers. meta platform (meta) recently announced their newest Meta Quest headset.
Apple shares rose 3.15% last week to 180.95. That’s just below the January 2022 high of 182.94.
tesla stock
Tesla shares rose 10.8% to 213.97 this week, including a 3.1% gain on Friday. The stock rose above its 200-day moving average on Tuesday. On Friday, TSLA shares crossed the buy point of 207.89, the benchmark for a cup or double bottom. The electric-vehicle giant has moved forward with above-average trading volumes for five consecutive sessions after several such days in the past three months.
BYD shares, on the other hand, rose 5.6% on the week to 31.50. Friday’s gain of 2.3% lifted the Chinese EV and battery giant above the 31.17 buy point for the cup with handles it first cleared on May 10. On Thursday, BYD reported a record delivery performance in May, surpassing the peak in the second half of 2022.
According to reports late Friday, Tesla is now announcing that the base Model 3 will receive a full tax credit of $7,500 in the US, like all other Model 3 and Model Y vehicles. How this happened is unknown. Meanwhile, Tesla has stepped up its referral program again, in addition to U.S. inventory discounts, especially for the Model 3.
Other stocks near the buy point
DXCM rose 6.5% last week to 122.57. On Thursday, DexCom regained his 50-day line and added gains on Friday with above-average volume. Early entry is offered. The continuous glucose monitor maker borders on two other consolidations and has a buy point of over 126.44 on a new flat basis, according to MarketSmith analysis. Several other medical product and system manufacturers are also worth noting. shockwave medical (SWAV) and intuitive surgery (ISRG).
LEN shares climbed 3.6% to $112 on Friday, rebounding above the 50-day line, signaling aggressive entry into new consolidations. On Wednesday, Renner shares fell to test the advance buy point. LEN shares rose sharply on Friday after several other homebuilders posted strong gains.
JPM shares surged 3% to 140.47, closing on a downtrend on a new flat base after the previous drop. It has not been extended from the 50-day line. JP Morgan looks much healthier than other banks, but bank stocks were bullish on Friday.
MAR shares climbed 3.55% to 177.22 on Friday after regaining the 50-day line on Thursday. Perhaps Marriott is proposing an early entry from the emerging flat base. Royal Caribbean (RCL) is on the rise, but most other travel stocks are like Marriott, trying to take off after a seizure.
Cybersecurity giant joins S&P 500 index
market rise analysis
The stock market rally this week showed further strength, along with encouraging signs of improving breadth and leadership.
The Nasdaq continued its rally, hitting a 13-month high on Friday. But last week he wasn’t just the AI playing.
The S&P 500 has definitively breached the 2023 range and is approaching the August 2022 high.
After testing the 200-day line for much of the week, the Dow Jones broke through the 50-day line on Friday. After breaking below the 50-day line on Wednesday, the Russell 2000 climbed to its highest level since early March and crossed the 200-day line for the first time since.
The First Trust Nasdaq 100 Equal Weighted Index ETF (QQEW) rose 1.4% for the week, the highest level in 52 weeks.
Invesco S&P 500 Equal Weight ETF (RSP) rose 1.9% for the week. Friday’s gain of 2.2% took the RSP clearly above the 50- and 200-day lines, breaking the downtrend dating back to early February.
On Thursday and Friday, the winners beat the losers. On Friday, winners led by more than 5-1 on the New York Stock Exchange and nearly 3-1 on the Nasdaq. However, the long-term trend is weak. And the downward trending A/D line is important.
The Nasdaq and Nasdaq 100 have extended, with the Nasdaq 100 now 9.5% above the 50-day line. Ideally, big tech companies, especially his AI industry, slow down or come to a halt while other sectors grow. Friday largely followed this pattern, with the Dow Jones, Russell 2000 and RSP comfortably outperforming the Nasdaq 100’s 0.7% gain.
This has created buying opportunities for some, including Tesla, Renner, Dexcom and JP Morgan.
Of course, just because it’s been strong for a few days, it doesn’t mean that the overall market rally is definitely underway. From a macro perspective, the debt ceiling is no longer a concern. Until just a few days ago, the Fed appeared to be headed for a rate hike on June 14, but now it appears to be poised to pause rate hikes. With earnings season (finally) coming to an end, the news cycle may enter a relatively quiet period.
Timing the Market with IBD’s ETF Market Strategy
what to do now
Investors should pay attention as the market rally begins to gain momentum and expand. Yes, this could also be a head fake. The marginal advance could resume, or worse, the market-wide rally could break or collapse.
But right now, the market is sending bullish signals. If we wait until a strong bull market undoubtedly takes hold, all the major stocks will do well.
Investors should consider adding more exposure, especially if they are mostly cash-managed. However, do so gradually to minimize the impact of sudden market reversals.
Being flexible is important. And just as you don’t want to get stuck in a bearish mindset, don’t be blindly bullish even if the overall market or your position is shaken.
Now is an important time to create a watchlist. Choose a group of stocks to watch, but cast a wide net to monitor a wide range of potential leaders.
Read “The Big Picture” daily to stay on top of market direction and key stocks and sectors.
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