Overnight, Dow futures rose slightly, along with S&P 500 and Nasdaq futures. The stock market rally resisted its big morning losses to close mixed on Thursday as two hawkish Federal Reserve officials eased interest rate hike fears somewhat.
Dow Jones Component United Health Group (United nations) before the market opened on Friday, as the quarterly earnings of health insurance companies and medical services companies began broadly. UN stock reversed higher from the 50-day line on Thursday to close 0.2% higher at 502.43, not far from the 518.90 buy point.
Banking giants Wells Fargo (WFC) And the City Group (c) also mentioned before the conquest. WFC and Citigroup stocks are in long downtrends. In fact, Citi stock fell to its worst level since late 2020 on Thursday, after weaker-than-expected earnings from c. B. Morgan Chase (JPM) And the Morgan Stanley (Ms).
China EV and battery giant BYD (BYDDF) followed bullish earnings guidance, but remained sharply lower for the week following rumors that Warren Buffett’s Berkshire Hathaway might sell some of its large stake in BYD. Starting China EV Lee Otto (LI) remain executable, while Tesla (TSLA) takes between two major moving averages.
Lanthus stock is running IBD Leaderboard. DLTR stock and Li Auto are on SwingTrader. Dollar Tree, Lantheus, BJ’s Wholesale, McKesson, UnitedHealth, LI are all available at defect 50. MCK Stock and Dollar Tree are also on IBD Big Cap 20.
False hawks show a small pigeon
Federal Reserve Board Governor Christopher Waller and St. Louis Fed President James Bullard, two of the most vocal Fed policymakers about raising interest rates, cut expectations Thursday for a 100 basis point rate hike later this month. The prospect of a point price increase fully rose on Wednesday after the hot June CPI report and Atlanta Federal Reserve Chairman Raphael Bostik’s statement that “everything is in the works.”
Waller said Thursday that 75 basis points remains the “base case” for a rate hike at the July 26-27 meeting, and says “markets may have gotten a little bit ahead of themselves” on 100 basis points, though he did not rule out a “bigger” move. .
Bullard told the Nikkei that he favored a move of 75 basis points, which he said would bring the Fed funds rate to a “neutral” level. He said more tightening was needed, but “we can assess” as the year goes on.
Ahead of the opening, the Producer Price Index unexpectedly accelerated in June to a sharp rise of 11.3% from a year earlier. But core inflation slowed more than expected. Notably, core PPI rose 0.4% from the previous month, cooling off May’s 0.7% gain. This was in contrast to the core CPI, which is showing accelerating gains from month to month.
Markets are now pricing in a 57% probability that the Fed will raise interest rates by 75 basis points. On Wednesday, the odds of a full point rise rose to 80% from about 8% the day before.
Dow jones futures contracts today
Dow Jones futures are up 0.3% against fair value. S&P 500 futures rose 0.35%. Nasdaq 100 futures rose 0.5%.
Chinese economic data was mixed overnight. GDP for the second quarter rose 0.4% compared to the previous year, and managed to grow despite the Covid shutdown during the second quarter, but lost views by 1%. Industrial production for June grew 3.9% from a year earlier, just below the consensus of 4.1%. However, retail sales rose 3.1%, defying views of flat results.
China boosted GDP growth by 0.4% in the second quarter of last year, missing expectations as the economy struggled to shake off the impact of Covid controls.
On Friday morning, investors will get US retail sales and industrial production data for June, along with the Empire Manufacturing Index for July.
stock market rise
The stock market rally eased Thursday morning amid fresh inflation fears and weak earnings from JPMorgan. Major indices closed lower, but closed near their best levels today.
The Dow Jones Industrial Average closed down 0.5% on Thursday stock market trading. The S&P 500 fell 0.3%. The Nasdaq Composite made partial gains. Small capital Russell 2000 decreased by 1%.
US crude oil prices fell 0.5% to $95.78 a barrel, far from intraday lows, but still the lowest close since April. Gasoline futures fell more than 1%, extending a rapid decline.
The 10-year Treasury yield rose 6 basis points to 2.96%, although it closed near session lows. The two-year yield wiped out significant gains to drop one basis point to 3.13%. The 1-year Treasury yield fell 3 basis points to 3.18%. The yield curve remains inverted from 1 year to 10 years, but to a lesser degree.
between the Best ETFsThe Innovator IBD 50 ETF (fifty) up 0.45%, while the IBD Breakout Opportunities ETF (Innovator)fit) sank 0.5%. iShares Expanded Technology and Software Fund (ETF)IGV) sank 0.9%. VanEck Vectors Semiconductor Corporation (SMH) rose 2.1%, with Taiwan Semiconductor (TSM) Profits and guidance for raising the chip segment.
SPDR S&P Metals & Mining ETF (XME) fell nearly 3% and the Global Infrastructure Development Fund (ETF) in the USA (cradle) decreased 0.6%. US Global Gates Foundation (ETF)Planes) down 0.7%. SPDR S&P Homebuilders ETF (XHB) down 1.1%. SPDR Specific Energy Fund (SPDR ETF)XLE) and the Financial Select SPDR ETF (XLF) both lost 1.9%. SPDR Healthcare Sector Selection Fund (XLV) decreased by 0.3%. UN stock is a major XLV component.
Shares reflect more speculative stories, the ARK Innovation ETF (see you) is down 2.1% and the ARK Genomics ETF (ARKG) 1.8%. Tesla stock continues to be the #1 spot in Ark Invest’s ETFs. Cathie Wood’s Ark also owns some shares of BYD.
Stocks near the points of purchase
Dollar Tree stock rose 1.7% to 168.76. This pushed DLTR stock back above 166.45 . cup with handle point purchase. Shares of the giant dollar store are up 7.8% above the 50-day line. The line relative forcethe blue line in the graphs presented, recorded new highs for weeks, according to MarketSmith Analysis.
BJ stock rose 2.95% to 70.16, just below 71.10 double bottom point purchase. Stocks crossed a downward sloping trend line, providing an early entry. Volume was rather light while BJ stock is up 14% above the 50-day line, which should give investors pause. Ideally, a chain of membership repositories would merge around current levels, possibly forming an indicator. The RS line of BJ stock has reached new highs.
LNTH stock rose 0.7% to 67.91, rebounding back from the 50-day streak. Although it did not break Friday’s high of 69.08, Lantheus stock is actionable. LNTH stock should have a decent base after this week at 73.88 buy point.
McKesson stock had a weak start on Thursday, falling below the 50-day line to 315.78 on the day. But stocks rebounded, closing up 0.4% at 362.55. MCK stock has 340.04 flat base A buy point, but investors can use 335.47, just above Monday’s high, as an early entry.
BYD stock soaring
The EV giant said Thursday that it expects first-half net profit to rise from 139% to 207% from a year earlier in local currency terms, 2.8 billion to 3.6 billion yuan ($533 million). Excluding non-recurring gains and losses, the profit should go up 578%-795%.
BYD stock jumped 8.4% to 37.71, bouncing back above the 50-day line after finding support at 200 on Wednesday. But stocks are still sharply lower during the week. BYD stock fell 11.3% Tuesday on rumors that Buffett may move to sell some or all of his stake in the EV maker. These rumors are still unconfirmed. But BYD stock needs to be created again, creating a new base next to the deep consolidation from November to June.
Smaller competitor Li Auto gained 0.4% to 38.18. LI stock is still actionable after Wednesday’s bounce from its 21-day streak. Li Auto stock is working on a new consolidation after doubling from early May to late June.
Tesla stock rose 0.5% to 714.94. The stocks are just above the 21-day line and below the falling 50-day line. TSLA stock just crossed the 10-week streak again. Tesla’s second-quarter earnings are due July 20.
Market Rise Analysis
For the second session in a row, the major indexes fell sharply in the morning but quickly rebounded, with the Nasdaq turning positive in the afternoon. On Thursday, the Nasdaq managed to post slight gains, while the S&P 500, Dow Jones and Russell 2000 indexes fell for the fifth consecutive session.
All major indices fell sharply during the week, which started with the Nasdaq hitting resistance again at the 10-week moving average. All indicators are below their 21 day moving averages.
After trending lower for several sessions, maybe the ‘uptrend is under pressure’ due to the rebound. But it doesn’t have to happen any time soon, and Thursday’s rush from the lows may have been the “rebound”.
Arguably, the leading indicators are range-bound, with highs in early or late June indicating a top, and lows in mid-June indicating a bottom. There is a lot of fluctuation within this range.
As earnings season rages on, adding to the whirlwind of inflation, stagnation and Fed uncertainty, volatility appears to be rising in the market and individual stocks are likely to continue.
What are you doing now
Medical stocks like UnitedHealth and McKesson rebounded not so well in the morning, but investors can’t count on intraday rallies to save the day.
The market is looking for a short term direction within a long and painful downtrend. It’s not a good environment for exposure a lot. Be quick to take some profits to lock in the gains in such a volatile market.
Create your watchlists and watch for major earnings in the coming days and weeks.
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