Dow Jones futures were higher after Monday’s stock market plunge ahead of Jackson Hole Federal Reserve Chairman Jerome Powell’s speech on Friday.
Palo Alto Networks (PANW) and Zoom video (ZM) were the main movers after the closing Monday. Palo Alto shares rose more than 7% on better-than-expected results, while Zoom shares fell nearly 7% in expanded trading after lowering revenues and sales prospects for the year.
Stock market today
On Monday, the Dow Jones Industrial Average fell 1.9%, while the S&P 500 lost 2.1%. The tech-heavy Nasdaq composite sold 2.55%. And the small-cap Russell 2000 was down 2.1%.
US stock market overview today
Last update: 4:28 PM ET 8/22/2022
Of the exchange-traded funds, the Nasdaq 100-tracker Invesco QQQ Trust (QQQ) fell 2.1% and the SPDR S&P 500 (SPY) fell 1.7%.
EV giant Tesla (TSLA) slipped 2.3% on Monday. Among Dow Jones leaders, Apple (AAPL) and Microsoft (MSFT) fell 2.3% and 2.9% respectively in today’s stock market.
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In the ongoing slump in the stock market, Albemarle (ALB), Arista Networks (A NET), Axcelis Technologies (ACLS) and Costco (COST) — as well as Dow Jones stock Coca Cola (KO), Merck (MRK) and McDonald’s (MCD) — are among the top stocks to buy and watch.
Albemarle is an IBD Leaderboard stock. Arista and Axcelis were featured in the Stocks near a buy zone column this week.
Dow Jones Futures Today: Treasury Yields, Oil Prices, Powell Speech
Prior to Tuesday’s opening, Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, were each up about 0.2% relative to fair value. Remember that overnight action in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular trading session.
The 10-year government bond yield rose to 3.03% on Monday, extending last week’s jump. The yield on 10-year government bonds is above the 3% level for the first time since July 21. Meanwhile, US oil prices rose as West Texas Intermediate futures traded near $91 a barrel.
Fed chief Powell will give a talk on the central bank’s economic outlook Friday from Jackson Hole, Wyo. .
Last week’s Fed minutes seemed to buck market expectations for a smooth pivot, which had already contributed to a six-week stock rally after the June 14-15 meeting. Markets are giving about a 56% chance of a 75 basis point rate hike on September 21. A week ago there was a 39% chance.
What to do in the current downturn in the stock market?
The stock market slump continued on Monday as major stock indices sold sharply and ended near session lows.
With the market showing more signs of continued weakness, investors should be more defensive with existing positions. That doesn’t mean you have to run completely to cash, but make sure your profits don’t evaporate and quickly lose losing positions.
Still, the overall trend remains up, so be on the lookout for stocks that are holding up best during the current stock market weakness. An easy way to identify leadership in the stock market is to use the relative strength line. A strong RS line as the stock market struggles is a strong technical indicator.
Monday’s Big Picture column noted: “Sellers came back from the weekend with a big appetite, pushing stock indices to a second consecutive day of sharp losses. After the two-session defeat, investors have reason to make some defensive adjustments. feed.”
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Investors can also create watchlists, find companies approaching a buying point, or develop custom screens at IBD MarketSmith.
Five Dow Jones Stocks to Watch Now
Dow Jones Stocks to Watch: Coca-Cola, McDonald’s, Merck
Dow Jones soda giant Coca Cola is building a flat base with a buy point of 67.30. A handle input at 65.14 is also in play. Shares fell below their early entry level during Monday’s 1.5% drop.
Shares of McDonald’s are trading back below a 265.56 cup-with-handle entry after Monday’s 1.35% drop.
Merck builds a flat base, a pattern showing a buy point of 95.82. According to the IBD MarketSmith chart analysis, stocks remain above their 50-day line amid Monday’s 1% drop.
MRK stocks show a solid 94 out of a perfect 99 IBD Composite Rating, according to the IBD Stock Checkup. Investors can use the IBD Composite Rating to easily measure the quality of a stock’s fundamental and technical statistics.
4 top growth stocks to keep an eye onrent Stock Market Rally
Top Stocks to Watch: Albemarle, Arista, Axcelis, Costco
IBD Leaderboard stock and lithium producer Albemarle is in the buy range after Monday’s recapture of a major cup with the handle’s 273.78 buy point. The 5% buy zone goes up to 287.47. In previous weeks, stocks topped a smaller cup with the handle’s buy point of 250.25.
Arista Networks, one of last week’s IBD 50 Stocks To Watch picks, continues to slog up the right side of a double bottom base offering a buy point of 143.67. With the stock about 11% away from current entry, look for a handle to provide a more risk-optimal buying point. Arista’s RS line is trending higher and approaching a new high. ANET shares fell 2.2% on Monday.
Retail giant Costco turned in its cup Monday with the handle’s 552.81 buy point, down 1.6%. Wait for a bullish revival in the entry before buying stocks.
Chip equipment maker Axcelis Technologies continues to build a handle cup that offers a buy point of 79.93, according to IBD MarketSmith chart analysis. The stock fell 4.8% on Monday.
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Tesla shares lost 2.3% on Friday, extending a losing streak to five sessions. Shares of the EV giant are finding solid resistance around their 200-day line.
Tesla shares are down about 30% from their 52-week high. The 3-for-1 stock split is set for Wednesday.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares sold 2.3% Monday as the stock continues to build the right side of a cup base with a buy point of 179.71. Another interpretation could be a large double bottom dating back to January. Anyway, the point of sale is identical. The last three days of losses could be the first part of a potential hold, which would offer a lower entry.
Bullish, the stock’s relative strength is holding new highs, indicating major stock market outperformance.
Microsoft fell 2.9% on Friday, extending a losing streak to five sessions and falling further from its 200-day line.
Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.
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