Dow Jones futures dropped Tuesday ahead of Fed Chair Jerome Powell’s speech. Aerospace giant Boeing (BA) slid after a Morgan Stanley downgrade.
Fed chief Powell will speak at the Sveriges Riksbank International Symposium on Central Bank Independence in Stockholm, Sweden. His speech is scheduled to start at 9 a.m. ET. Powell’s speech comes on the heels of comments from Atlanta Federal Reserve President Raphael Bostic and San Francisco Fed President Mary Daly that tripped up markets on Monday. Daly and Bostic each pointed to Fed rate hike increases to somewhere above 5%.
Powell’s comments also follow Friday’s jobs report, which saw wage growth cooling much more than expected and workers clocking fewer hours for a second straight month. The data should allow the Fed to further slow its pace of interest-rate hikes.
Late Monday, Jefferies (JEF) reported earnings that met estimates, and sales that topped forecasts. Jefferies shares lost more than 3% in early morning trade. Albertsons (ACI) climbed 1% after an earnings beat. Bed Bath & Beyond (BBBY) trimmed gains to 5% in morning trade after missing fiscal-Q3 estimates.
Dow Jones aerospace leader Boeing dropped 2.5% after Morgan Stanley downgraded the stock from overweight to equal weight. Royal Caribbean (RCL) inched higher after Morgan Stanley upgraded the cruise operator from underweight to equal weight. Finally, AT&T (T) rose 1%, as Wells Fargo upgraded the stock from equal weight to overweight.
Electric-vehicle leader Tesla skidded 1% Tuesday, despite reports that the automaker delivered more than 10,000 vehicles in a single day on Friday. Dow Jones tech giants Apple (AAPL) and Microsoft (MSFT) were both lower ahead of today’s stock market open.
Deere (DE), IBD Leaderboard stock ELF Beauty (ELF), Rio Tinto (RIO) and IBD SwingTrader stock Super Micro Computer (SMCI) — as well as Dow Jones names Caterpillar (CAT), Chevron (CVX) and Walmart (WMT) — are among the top stocks to buy and watch with the market back in rally mode.
Dow Jones Today: Oil Prices, Treasury Yields
Before Tuesday’s opening bell, Dow Jones futures declined 0.5% below fair value. S&P 500 futures also lost 0.5%. And tech-heavy Nasdaq 100 futures dropped 0.7% in morning action.
The 10-year Treasury yield ticked higher to 3.56% Tuesday morning, looking to snap a two-day losing streak.
Meanwhile, oil prices headed for a third straight advance, recovering to around the midpoint of their recent trading range. West Texas Intermediate futures rose less than 1%, trading around $75 a barrel.
Stock Market Rally
On Monday, the Dow Jones Industrial Average closed down 0.3% after giving up solid gains, and the S&P 500 lost 0.1%. The Nasdaq composite pared strong gains to 0.6%.
Monday’s The Big Picture column commented, “If this stock market uptrend is for real, investing opportunities will appear for weeks or months. Thus, there’s no need to rush. With any buys, start with half your intended investment. If the stock continues rising, add more while trying to complete your buys before shares are more than 5% above the buy point.”
Dow Jones Stocks To Buy And Watch: Caterpillar, Chevron, Walmart
Dow Jones member Caterpillar closed squarely in buy range above a flat base’s 239.95 buy point following Monday’s 3.6% advance, according to IBD MarketSmith pattern recognition. The buy zone, which CAT shares have dodged in and out of since Dec. 21, goes up to 251.95. Bullishly, the stock’s relative strength line, a key technical indicator, is at new highs. Shares were down 0.3% Tuesday.
Energy giant Chevron is trying to retake its 50-day line, as it continues to build a cup base that has a 189.78 buy point. CVX shares fell 0.3% Tuesday morning, despite the modest rise in oil prices.
Discount retailer Walmart bullishly reclaimed its 50-day line during Friday’s 2.45% jump. It then un-bullishly gave back that support on Monday. Shares are building a cup-with-handle base that has a 154.74 buy point and are about 5% away from the latest entry. Walmart shares edged lower Tuesday morning.
Top Stocks To Buy And Watch: Deere, ELF Beauty, Rio, Super Micro
Recent IBD Stock Of The Day, Deere, is building a flat base with a 448.50 buy point. Shares have their eye on the buy point as they rebound from a test of 50-day support. Deere shares lost 0.4% Tuesday morning.
IBD Leaderboard stock ELF Beauty gave up its 57.03 flat-base entry amid Monday’s sharp decline. Shares broke out Friday in big volume, indicating strong institutional demand for the cosmetics leader. The 5% buy zone tops out at 59.88 if the stock is able to regain the buy point. ELF stock declined 0.6% Tuesday.
Recent IBD Stock Of The Day Rio Tinto rose 0.1% Monday, moving further above a cup with handle’s 73.45 buy point. The buy area runs up to 77.13. Rio shares traded slightly higher Tuesday.
IBD SwingTrader stock Super Micro Computer is rapidly moving up the right side of a short consolidation that has a 95.32 buy point. Shares rallied 4.7% Monday. SMCI stock moved down 1.5% Tuesday morning.
Stocks To Buy And Watch In New Stock Market Rally
These are seven top stocks to buy and watch in today’s stock market, including three Dow Jones leaders.
|Company Name||Symbol||Correct Buy Point||Type Of Base|
|ELF Beauty||(ELF)||57.03||Flat base|
|Rio Tinto||(RIO)||73.45||Cup with handle|
|Super Micro Computer||(SMCI)||95.32||Consolidation|
|Walmart||(WMT)||154.74||Cup with handle|
Source: IBD Data As Of Jan. 10, 2023
Tesla stock surged nearly 6% Monday, adding to Friday’s upside reversal. Shares remain sharply below their 50- and 200-day lines. Last week, shares hit a 52-week low at 101.81. Tesla stock closed Monday about 68% off its 52-week high.
Shares of the EV giant threatened to snap a two-day win streak, falling 0.9% Tuesday morning.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares climbed 0.4% Monday. Last week, the stock hit a new 52-week low price of 124.17. The stock remains around 20% off its 52-week high. AAPL stock moved down 0.5% Tuesday.
Microsoft stock rallied 1% Monday, adding to Friday’s gains. The software giant is about 30% off its 52-week high and is still just off its 52-week low of 213.43, reached on Nov. 4. Microsoft shares lost 0.4% early 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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