Dow Jones futures briefly rose 100 points Tuesday morning ahead of Fed chief Jerome Powell’s confirmation hearing. Tesla stock rebounded on strong China sales, while EV rival Rivian fell short of its 2021 production target. Rebounding tech stocks were early leaders, with Illumina and Juniper Networks pacing the S&P 500. Intel shares rallied on a key executive changes.
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Among the Dow Jones leaders, Apple (AAPL) rose 0.7% premarket Tuesday, while Microsoft (MSFT) moved up 0.6% in today’s stock market. Also among the Dow 30, financial leaders Goldman Sachs (GS) and JPMorgan Chase (JPM) are near new buy points.
Intel (INTL) jumped 1.2%, leading the Dow, after announcing it had lured Micron Technology (MU) Chief Financial Officer David Zinsner as Intel’s new CFO, effective Jan. 17.
Electric-vehicle leader Tesla (TSLA) traded up more than 1% after China Passenger Car Association data showed the company scored record sales there in December. EV truck rival, Rivian (RIVN), dropped 3%. Lucid Group (LCID) rose around 1.5%. And Chinese EV leaders Li Auto (LI) and Xpeng Motors (XPEV) were higher Tuesday morning.
Among Tuesday’s top stocks to buy and watch, Commercial Metals (CMC), Diamondback Energy (FANG), SVB Financial (SIVB) and Wells Fargo (WFC) are in or near new buy zones.
Microsoft and Tesla are IBD Leaderboard stocks. Commercial Metals and SVB Financial featured in this week’s Stocks Near A Buy Zone column.
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Dow Jones Today: Powell Hearing, Treasury Yields
Ahead of the stock market open Tuesday, Dow Jones futures moved up 0.1% vs. fair value, while S&P 500 futures rose 0.15%. Nasdaq 100 futures climbed 0.15% vs. fair value. 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) rose 0.5% and the SPDR S&P 500 ETF (SPY) traded up 0.25% premarket Tuesday.
The 10-year Treasury yield ticked lower, to 1.76% Tuesday morning. The 10-year Treasury yield on Monday traded as high as 1.8% before finishing at 1.78% — its highest level since Jan. 17, 2020.
Later this morning, Federal Reserve Chairman Jerome Powell will face questions at his Senate confirmation hearing. Powell is expected to win a second term as the head of the central bank.
Stock Market ETF Strategy And How To Invest
Stock Market Rally Weakens
The stock market posted some positive action Monday, as the Nasdaq snapped a four-day losing streak and found support at its long-term 200-day line. The S&P 500 dropped for a sixth straight session, and gave up its key 50-day support level. However it did close sharply off its lows. The Dow Jones industrials halted Monday’s slide around the 50-day line.
Monday’s The Big Picture commented: “The stock market now needs to show it can follow up Monday’s reversals with more gains. It could be a tough week to rally, however. With so many variables at play, investors would do well to remain cautious. IBD’s stock market outlook is ‘uptrend under pressure,’ and investing in growth stocks has been as tough as a blizzard.”
Following Monday’s stock market action, it’s an important time to read IBD’s The Big Picture.
Five Best Dow Jones Stocks To Watch Now
Stocks On The Move: CVS, IBM
CVS Health (CVS) rallied 1.3% Tuesday after the company raised its full-year earnings outlook. CVS stock ended Monday about 16% above a flat base’s 90.7 buy point.
Illumina (ILMN) popped 4.6% after updating its fourth-quarter guidance during the J.P. Morgan Healthcare Conference late Monday. American Airlines (AAL) also updated its revenue and capacity outlooks, and received an upgrade from Morgan Stanley.
Juniper Networks (JNPR) rallied 4.6% and Las Vegas Sands (LVS) jumped 2.7%, both following analyst upgrades.
IBM (IBM) slid around 2% Tuesday morning after UBS downgraded the stock from neutral to sell. Shares are tracing a double bottom with a 146.10 buy point, but the stock has a weak RS line.
Dow Jones Stocks To Buy And Watch: Goldman Sachs, JPMorgan
Dow Jones stock Goldman Sachs rallied 0.4% Monday, ending just above the 50-day line. Shares are tracing a flat base with a 426.26 buy point, according to IBD MarketSmith chart analysis. An early entry at 412.76 is also in play. Shares rose 0.3% premarket Tuesday.
JPMorgan shows a 173.06 buy point in a flat base after retaking the 50-day line in a 5.6% rally last week. Shares rose 0.25% premarket Tuesday.
Three Top Growth Stocks To Watch In The Current Stock Market Rally
Stocks To Buy And Watch: Commercial Metals, Diamondback, SVB Financial, Wells Fargo
IBD 50 stock Commercial Metals is trying to regain a 36.96 buy point from a cup base, according to IBD MarketSmith chart analysis, though it pared its gain to 0.6% Monday. Early Monday, the company posted fiscal first-quarter earnings that trounced estimates as strong margins helped overcome light revenue. Shares were flat premarket Tuesday.
Oil producer Diamondback Energy is holding just above a 117.81 buy point, following Monday’s 0.1% fall. The 5% buy area tops out at 123.70. Bullishly, the stock’s RS line hit a new high on the breakout day, confirming the energy stock as a market leader. FANG stock boasts a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. Shares rose about 1% premarket Tuesday.
SVB Financial is tracing a cup base with a 763.32 buy point. Shares could be adding a handle this week, but it’s a bit too early to be considered proper. If the handle finishes, the new buy point will be 746.80. Shares skidded 3% Monday, closing at their 50-day moving average line. Shares were unchanged premarket Tuesday.
Banking giant Wells Fargo is just past 5% buy range above a 52.67 buy point in a flat base after Monday’s 1.1% rise. The 5% buy area went up to 55.30. Shares inched higher premarket Tuesday.
Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live
EV Stocks: Li Auto, Xpeng, Lucid Motors, Rivian
Li Auto stock broke below its long-term 200-day moving average during Monday’s 5.6% skid. There is no new buy point at this time with the stock nearly 30% off its 52-week high. Shares rose 1% premarket Tuesday.
Xpeng Motors tumbled 5.4% Monday and is again trying to find support around its 200-day line. Shares had been forming a cup with handle, but that formation is gone now. Shares gained 1% premarket Tuesday.
Among U.S.-based EV stocks, Lucid Motors shares climbed 1.5% premarket Tuesday. LCID stock remains extended past a 28.49 buy point in a cup-with-handle base, but huge gains have dwindled. Shares are again attempting to regain their 50-day line this week, which would be bullish for the stock’s base-building prospects.
Tesla Stock Rises As China Sales Topped 70,000 In December
Recent initial public offering Rivian moved down 3% premarket Tuesday, threatening to add to Monday’s 5.6% fall and extend a losing streak to seven sessions that saw the stock hit all-time lows. Late Monday, the company said it produced 1,015 vehicles in 2021, missing its target of making 1,200 electric vehicles.
RIVN shares closed Monday about 55% off their post-IPO highs. Continue to wait for an IPO base to form before considering a purchase. Recent sharp losses are a significant setback in the stock’s basing process and there is no new buy point in sight with the stock at new lows.
Tesla Stock
Tesla stock traded up 3% Monday, snapping a four-day losing streak. Early Tuesday, Tesla shares rose over 1% after the China Passenger Car Association said Tesla sold 70,847 electric vehicles in China in December, a 34% rise month over month. Last week, the EV leader gave up its critical 50-day moving average line and triggered the 7%-8% loss-cutting sell rule from a 1,119.10 trend line buy point.
Shares traded as high as 1,243.49 on Nov. 4, but the stock ended Monday about 15% off that 52-week high.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple stock turned barely higher after briefly hitting its lowest level since Dec. 20. Shares remain about 12% past a 153.27 buy point out of a cup-with-handle base, according to IBD MarketSmith chart analysis, after nearly hitting the 20%-25% profit-taking level. Shares rose 0.7% premarket Tuesday.
Software leader Microsoft rose 0.1%, recovering from sharp losses. The top Dow Jones stock continues to etch a flat base with a 349.77 buy point, but the stock clearly has more work to do before a potential breakout. Shares rose 0.6% premarket 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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The post Dow Jones Futures Rise Ahead Of Powell Testimony; Tesla China Sales Strong; Rivian Misses Production Target appeared first on Investor’s Business Daily.