Dow Jones futures were lower late on Tuesday, while S&P 500 futures and Nasdaq futures were also lower. The stock market rose on Tuesday, underperformed, and closed lower, but out of intraday lows. On Wednesday morning, inflation concerns shocked the consumer price index of global investors.
Tesla stock Facebook (FB), apple (AAPL), Nvidia (NVDA), Rob Rox (RBLX) Goldman Sachs (GS), Terex (TREX) and Marlin Max (HZO) is one of the stocks to watch, albeit for different reasons.
Tesla TSLA (TSLA) is still the focus of market attention as it seeks long-term support after weak Chinese sales data. Apple stock is also trying to rebound from the long-term average. Facebook stock and Goldman Sachs are seeking support in buying. Trex and HZO’s stocks have retreated, but both are below the buying point. After the previous breakout failed, Nvidia stock is looking for key support. RBLX’s stock soared after making a profit because it established another potential IPO basis.
The stock market went through a shock, and the main indexes started to fall. Nasdaq once looked like a vertical violation. However, the high-tech index, which has been lagging behind in recent days and the past few months, has slashed its losses. The same is true for the small-cap Russell 2000. The Dow Jones and S&P 500 index underperformed on Tuesday, but they are not far from record highs.
Goldman Sachs shares in SwingTrader. HZO stock is on IBD 50. Apple stock and Goldman Sachs stock are in the Dow Jones Index.
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Tap inflation data
The Department of Labor released the April Consumer Price Index at 8:30 am Eastern Time. Economists predict that the CPI will rise 0.2% from March. The core CPI, which excludes food and energy, is expected to rise by 0.3%. In the same period last year, the CPI should rise by 3.6%, and the core CPI should rise by 2.3%. These include a light comparison with April 2020, when the global economy was disrupted by the pandemic and related shutdowns, which caused energy prices to plummet.
The producer price index, which is more sensitive to price spikes, is scheduled to be released on Thursday morning.
Despite this, rising commodity prices are beginning to penetrate the economy, and many companies are citing imminent pressure on profits. The huge government spending, plus another 4 trillion dollars in the two plans launched by President Joe Biden, is accelerating economic growth and the rapid global recovery after the pandemic.
The Fed said that the inflation rate will accelerate in 2021, but then it will cool down again. What is worrying is that inflation will not be temporary. This will force the Fed to step in, first by reducing the scale of bond purchases, and ultimately by raising interest rates.
Remember that the Fed’s favorite inflation indicator, the PCE core deflator, depends largely on housing prices. Despite the sharp rise in housing prices, the equivalent rent of the owners has not risen. At the same time, moderate medical expenses are helping to control overall inflation, even if Americans feel the pressure of gas stations and grocery stores.
Dow Jones Futures Today
Dow Jones index futures fell less than 0.1% from fair value. S&P 500 futures fell 0.1%. Nasdaq 100 futures fell 0.1%.
Keep in mind that overnight trading in Dow Jones Index futures and elsewhere will not necessarily translate into actual trading in the next regular stock market session.
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Global coronavirus cases reached 160.28 million. The death toll from Covid-19 exceeds 3.32 million.
In the United States, the number of coronavirus cases has reached 33.54 million, and the death toll has exceeded 596,000.
The stock market rebounded on Tuesday
The stock market rose relatively well, but it ended in the loss column on Tuesday.
The Dow Jones Industrial Average fell 1.4% in Tuesday’s stock market trading. Despite the close close to the daily high, the S&P 500 index fell 0.9%. The Nasdaq Composite Index rebounded and fell only 0.1%.
Highly valued technology stocks rebounded, while mining and metals stocks performed strongly. At the same time, housing-related names are struggling, and financial businesses have fallen.
Among the best ETFs, the innovative IBD 50 ETF (FFTY) fell 1.2%, with HZO stock being dragged down. Innovator IBD Breakthrough Opportunity ETF (BOUT) fell nearly 2%. iShares expanded technology software industry ETF (IGV) rose 1.1%. The VanEck Vector Semiconductor ETF (SMH) edged up 0.2%. Nvidia stock is the major share of SMH.
The SPDR Standard & Poor’s Metals and Mining ETF (XME) rose 2.3%, while the Global X US Infrastructure Development ETF (PAVE) fell 0.9%. The US Global Jet ETF (JETS) edged up 0.4%. SPDR Standard & Poor’s Home Builders ETF (XHB) fell 1.5%.
Reflecting more speculative story stocks, ARK Innovation ETF (ARKK) rose 2.1%, and ARK Genomics ETF (ARKG) rose 1.05%. Both are well below their 200-day line. Tesla stock is the largest stock in the ARK Invest ETF.
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Tesla shares fell 1.9% to 617.20, but rebounded from an intraday low of 595.60. In the weekly chart, TSLA stock tested its 40-week line for the first time since the end of 2019. The relative strength and weakness line happens to be at the low point of 2021, reflecting that the performance of the EV giant relative to the Standard & Poor’s 500 is lagging behind 2020.
Maintaining the 40-week and 200-day lines is crucial for Tesla stock. As the final “story stock” in 2020, Tesla may reflect on and contribute to further weakness in the field, or stimulate a rebound.
Earlier on Tuesday, the China Passenger Car Association reported that Tesla sold 25,845 Chinese-made cars in April. Tesla shipped 14,174 cars to Europe. CPCA’s sales obviously include Tesla’s exports, which were not included in the previous months. If this is the case, it would mean that sales in China were only 11,671, a 67% drop from 35,478 in March. If exports are excluded, monthly sales will still drop by 27%.
It is not clear what caused Tesla’s sales to fall. The official media emphasized the complaint, which may reflect the strong opposition of Chinese consumers. Otherwise, Tesla may be struggling with chip shortages like other auto industries.
Apple shares fell 0.7% to 125.91. During the session, the stock price rebounded from the 200-day moving average. Apple’s stock price is still below its 50 antenna, and the RS line is also close to recent lows.
FB stock price rebounded from the 10-week line and remained at the 300 level, rising 0.2% to 306.53. Facebook stock gave up all of its recent quarterly earnings growth, but was within the buy range of the 299.81 handle buy point that was initially cleared on April 1. The RS line of FB stock is close to the 2021 high, but still far below its peak at the end of 2020.
Nvidia’s stock price rose 0.3% to 572.25 after rebounding from the 50-day antenna. Like many chip stocks, the recent Nvidia breakthrough failed. If NVDA stock returns to the 21st line and breaks through the decline, it may send an early buy signal. However, just like Apple’s stock, its RS product line is not inspiring.
RBLX shares soared 21% to 77.65 on Tuesday. Late Monday, the video game IPO revenue and sales failed to materialize, but user growth was strong. After the initial public offering failed, Roblox stock tried to form another short merger, forming a too short double bottom pattern. Investors can start from the compressed “W”-shaped merger mid-term, with 77.70 as the early entry capital. But after taking such a big move, the callback is not surprising.
MarineMax shares fell 6.1% on Tuesday to 62.43, falling below 64.09 cup base purchase points. It is no surprise to withdraw from the cup holder, especially in the current market environment. The boating retailer has a large volume, which is not a good sign. But the RS line of HZO stock is still close to the high point. MarineMax’s revenue growth is also worthy of attention.
Trex shares fell 1.6% on Tuesday to 106.10, after the man-made wood product manufacturer reported better-than-expected results despite slower EPS and sales growth. The stock price rebounded from a low point, and given the decline in housing-related stocks, the closing decline was smaller. The 107.74 entry point is still valid, but investors may treat the past few weeks as masters and wait for Trex stock to clear the small merger. The RS line is not far from the high point.
Remember that opponent Azek (AZEK) reported on Thursday. On Tuesday, AZEK stock also fell below the buy point.
GS shares fell 2.4% to 359.92. According to MarketSmith’s analysis, Goldman Sachs stock is still above the shallow cup basic buying point of $356.95. The RS line is just below the high point.Goldman Sachs’ revenue growth has been picking up
The Dow Jones Index fell back to its 21-day index moving average. The S&P 500 index hit a one-month low and closed below the 21-day line for the first time since the end of March. However, the broad market index is close to the intraday high, rather than the highest level in history.
The Nasdaq Index performed relatively better than the broader market on Tuesday, and after a short period of upside, the loss was limited. Nevertheless, it is still below its 50-day line and has lost its important position in the past week or two. Russell 2000 (Russell 2000) fell further from its 50-day level, although it was also close to its intraday high after falling to its lowest level since the end of March.
Although the stock market rebound is in a definite uptrend, short-term actions are lacklustre.
Continued industry rotation has aggravated the overall trend of the firecracker market. In the past few months, mining stocks and story stocks have risen, but on Tuesday, they have both risen. At the same time, although the yield on the 10-year U.S. Treasury bond has not increased much, housing-related stocks have performed poorly.
If the stock market rebounds from here, then Tuesday will be a short-term bottom. However, if the selling continues, investors will soon forget the short intraday rebound.
What to do now
In all these market uncertainties, investors should be cautious about increasing exposure. Maybe Tuesday’s low will turn into a huge buying opportunity. However, if the market continues to decline, even those who stand out may struggle to maintain their position.
There is not much to buy. Tesla stocks and other storytelling have been severely damaged. Apple stock does not look encouraging. Goldman Sachs stock and Facebook are in the buying range. Trex and HZO stocks may be effective soon. RBLX stock may send out a buy signal, although that is a very volatile name. Some oil and gas companies that have seen failures in recent outbreaks are rebounding, although many have not.
In addition, investors may wish to consider further reductions in exposure until the short-term market direction looks more favorable. When you plan a picnic, if there is a 50% chance of rain, you don’t want to choose a date. When investing a large amount of real currency, you want to get favorable odds.
Market volatility is the most dangerous for active investors, because there are enough positive actions to attract investors, usually just to attract them.
Nevertheless, even if investors do not seize the opportunity in the end, they should always be looking for new buying opportunities. Remember to remain involved as a whole. The stock market rebound may improve quickly, or even worsen even faster.
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