Dow Jones futures rose Tuesday morning, as the market leaned toward a modest rebound following Monday’s stock market plunge. More inflation data came out with the Labor Department’s producer price index early Tuesday, while the Federal Reserve’s highly-anticipated two-day meeting will also kick off.
Oracle (ORCL) reported earnings after the close Monday. Oracle shares jumped 12% in morning trade after the company reported better-than-expected earnings and sales results.
Amazon (AMZN) and China-based stocks propped the Nasdaq. Amazon traded up 1%, looking to snap a five-day sell-off, after JPMorgan reiterated the stock’s overweight rating and 200 price target. Among ETFs tracking China-based issues, the KraneShares CSI China Internet ETF (KWEB) popped 2.9% and the iShares MSCI China ETF (MCHI) rallied 2.4% in early trade.
Electric-vehicle giant Tesla (TSLA) rose around 1% Tuesday after a tweet from CEO Elon Musk confirmed release of full self-driving software in two weeks. Elsewhere, Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) were up 0.7% each, ahead of today’s stock market open.
Amid a deepening stock market correction, Dow Jones leader Chevron (CVX), as well as Carlisle (CSL), HealthEquity (HQY), Northrop Grumman (NOC) and World Wrestling Entertainment (WWE), are among IBD’s top stocks to watch for Tuesday.
World Wrestling Entertainment is an IBD Leaderboard stock. And WWE was featured in this week’s Stocks Near A Buy Zone column.
Dow Jones Today: Treasury Yields, Oil Prices, Fed Meeting, Inflation
Ahead of Tuesday’s open, Dow Jones futures crept up 0.4% vs. fair value, and S&P 500 futures rose 0.6%. Nasdaq 100 futures gained 0.9%. Remember that trading in Dow Jones futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) moved up 0.9%. The SPDR S&P 500 ETF (SPY) rose 0.6% in early trade.
The 10-year Treasury yield ticked lower to 3.31% Tuesday morning following Monday’s surge to 3.36%, its highest level since April 2011. Meanwhile, U.S. oil prices remain near recent highs, with West Texas Intermediate trading above $121 a barrel. In early March, WTI briefly topped out above $130 a barrel.
Federal Reserve Meeting: 4 Key Questions Will Shape Dow Jones Outlook
Labor Department data showed that producer prices rose 0.8% in May after moving up 0.5% in April, meeting Econoday estimates. Producer inflation jumped 10.8% year over year, slightly lower than then 11% estimate. The producer price index is a measure of pricing strength based on selling prices received by domestic producers for their output.
The Fed will begin its latest two-day policy meeting Tuesday, and it is widely believed that the central bank will raise its benchmark interest rate by half a percentage point on Wednesday. But expectations that the Fed will be forced to move even more aggressively this year are on the rise since Friday’s hot inflation report.
Stock Market Sell-Off
The stock market sold off Monday, as the major stock indexes finished with heavy losses, starting the week on a down note.
Monday’s The Big Picture column commented, “After gapping down at the open, indexes remained weak into the close. The four-day losing streak in the main indexes is now the largest since March 2020, according to Dow Jones Market Data. The precipitous drop rivals that year’s Covid market crash. Except this time, we’re already at least five months into a market decline.”
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Investors also can create watchlists, find companies nearing a buy point, or develop custom screens at IBD MarketSmith.
Five Dow Jones Stocks To Watch Now
Dow Jones Stocks To Watch: Chevron, Merck, Travelers
Dow Jones leader and energy giant Chevron gave up its flat base’s 174.86 buy point, according to IBD MarketSmith chart analysis, following Monday’s 4.6% decline. CVX stock boasts a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. Investors can use the IBD Composite Rating to easily gauge the quality of a stock’s fundamental and technical metrics. CVX shares rose 0.6% Tuesday morning.
Merck (MRK), a Dow Jones and IBD Big Cap 20 stock, fell further below its cup-with-handle’s 89.58 buy point Monday, as shares dropped another 2.5%. The stock gave up support around its key 50-day line Friday, which is a sell signal. MRK shares were flat Tuesday morning.
Insurance giant Travelers (TRV) continues to build a flat base with a 188.08 buy point. Shares are further below their 50-day line after Monday’s 0.9% fall. Travelers stock traded unchanged early Tuesday.
Two Top Growth Stocks To Watch In The Current Stock Market Correction
Stocks To Watch: Carlisle, HealthEquity, Northrop, WWE
Recent IBD Stock Of The Day Carlisle shows a flat base with a 275.23 buy point, even as the stock tumbled 4.6% Monday to give up its 50-day line. Carlisle shares were unchanged Tuesday morning.
HealthEquity is tracing a cup with handle with a 66.23 buy point, as shares reversed 0.9% higher Monday. The stock is finding support around its key 50-day line and is just 2% away from the latest entry. Keep in mind the weak market environment should keep you on the sidelines. Shares were quiet Tuesday morning.
Northrop Grumman is trying to find much-needed support at its 50-day moving average, but remains about 3% below its cup-with-handle’s 477.36 buy point. NOC shares were flat Tuesday.
IBD Leaderboard stock World Wrestling Entertainment is testing a flat base’s 63.81 buy point, according to IBD MarketSmith chart analysis, as WWE shares edged higher Monday. On May 25, the stock staged a strong breakout past the entry. But shares are just above the latest entry in the new wave of market selling. WWE shares traded unchanged Tuesday.
Per Leaderboard commentary, the relative strength line for WWE stock is at highs and has been gaining ground since January. The base is first stage, a bonus for the chart.
Join IBD experts as they analyze leading stocks in the current stock market correction on IBD Live
Tesla stock skidded 7.1% Monday, adding to Friday’s 3.1% decline. Shares looked to rebound a bit from those losses, trading up around 1% Tuesday morning.
The stock is still sharply below its 50- and 200-day moving averages. Tesla stock traded as high as 1,243.49 on Nov. 4. Shares are about 48% off that record high.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares sold off 3.8% Monday, hitting their lowest level since June 2021. The stock is far below its long-term 200-day line and is about 28% off its 52-week high. AAPL stock traded up 0.7% Tuesday, as Deutsche Bank maintained its buy rating, but did lower its price target from 200 to 175.
Software leader Microsoft lost 4.2% Monday, and remains sharply below its 50- and 200-day lines. The stock closed more than 30% off its 52-week high. MSFT shares rose 0.8% Tuesday.
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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