Dow Jones futures were little changed after Monday’s stock market plunge ahead of Federal Reserve Chairman Jerome Powell’s speech in Jackson Hole on Friday.
Palo Alto Networks (PANW) and Enlarge video (ZM) were the main drivers of earnings after Monday’s close. Palo Alto shares jumped more than 7% on better-than-expected results, while Zoom stock slipped nearly 7% in extended trade after slashing its earnings and sales outlook 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 fell 2.1%.
Overview of the US stock market today
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Last Updated: 4:28 PM ET 08/22/2022
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 2.1% and the SPDR S&P 500 (SPY) fell 1.7%.
VE Giant You’re here (TSLA) slipped 2.3% on Monday. Among the leaders of the Dow Jones, Apple (AAPL) and Microsoft (MSFT) slipped 2.3% and 2.9%, respectively, in the current stock market.
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In the continued decline of the stock market, Albemarle (ALB), Arista Networks (A NET), Axcelis Technologies (AATC) and Costco (COST) – as well as Dow Jones stocks Coca Cola (KO), Merck (MRK) and McDonald’s (MCD) – are among the best stocks to buy and watch.
Albemarle is an IBD ranking title. Arista and Axcelis were featured in this week’s Stocks Near A Buy Zone column.
Dow Jones Futures Today: Treasury Yields, Oil Prices, Powell’s Speech
Prior to Tuesday’s open, Dow Jones futures, as well as S&P 500 and Nasdaq 100 futures were little changed from fair value. Remember that overnight action on futures contracts on Dow Jones and elsewhere does not necessarily translate into actual trading in the next regular trading session.
The 10-year Treasury yield hit 3.03% on Monday, extending last week’s jump. The 10-year Treasury yield is above the 3% level for the first time since July 21. Meanwhile, US oil prices edged higher, with West Texas Intermediate futures trading near $91 a barrel.
Fed Chief Powell will deliver a speech Friday on the central bank’s economic outlook from Jackson Hole, Wyo. The Fed has raised interest rates this year in an effort to lower inflation and signaled that further increases are to come.
Last week’s Fed minutes appeared to push back market expectations for a dovish pivot, which had already helped spark a six-week stock market rally after the June 14-15 meeting. Markets are pricing around a 56% chance of a 75 basis point rate hike on September 21st. A week ago, there was a 39% chance.
What to do in the current stock market downturn
The stock market’s decline continued on Monday as major equity indices sold off sharply, ending near session lows.
As the market shows more and more signs of continued weakness, investors should play more defensively with existing positions. This doesn’t mean you should take refuge entirely in the money, but make sure your gains don’t evaporate and be quick to exit losing trades.
Still, the overall trend remains bullish, so keep an eye out for stocks that are holding up best during the current stock market weakness. An easy way to identify stock market leadership is to use the relative strength line. A strong RS line as the stock market struggles is a strong technical indicator.
Friday’s The Big Picture column commented, “On Tuesday, the S&P bottomed just at its 200-day moving average, and subsequent losses indicate that the line is indeed a resistance level.”
If you are new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns is one of the keys to investing guidelines. IBD offers a wide range of growth stock listings, such as Leaderboard and SwingTrader.
Investors can also create watchlists, find companies close to a buy 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 that has a buy point of 67.30. A handle entry at 65.14 is also in play. Shares fell below their anticipated entry on Monday’s 1.5% decline.
Shares of McDonald’s are trading below an entry of 265.56 cup with handle after Monday’s 1.35% drop.
Merck builds a flat base, a pattern that shows a buy point of 95.82. Shares remain above their 50-day line amid Monday’s 1% decline, according to chart analysis from IBD MarketSmith.
The MRK stock is posting a solid 94 out of a perfect IBD composite rating of 99, according to the IBD stock balance sheet. Investors can use the IBD Composite Rating to easily assess the quality of a stock’s fundamental and technical metrics.
4 growth stocks to watch in the currentrStock market rally
Top stocks to watch: Albemarle, Arista, Axcelis, Costco
Equity and lithium producer IBD Leaderboard Albemarle is in the buy range after Monday’s resumption of a big cup with the handle’s buy point of 273.78. The 5% buy zone rises to 287.47. In the previous weeks, shares have moved above a smaller cup with the 250.25 buy point of the handle.
Arista Networks, one of last week’s IBD 50 Stocks To Watch picks, continues to rise off the right side of a double-bottom base that offers a buy point of 143.67. With the stock around 11% from the current entry, look for a handle to offer a more risk-optimal buying point. Arista’s RS line has been trending higher and is approaching a new high. ANET shares fell 2.2% on Monday.
Retail giant Costco returned its cup with the handle’s buy point of 552.81 on Monday, down 1.6%. Wait for a bullish resumption of the entry before buying stocks.
Chip equipment maker Axcelis Technologies continues to build a mug with handle that offers a buy point of 79.93, according to IBD MarketSmith’s chart analysis. The stock fell 4.8% on Monday.
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Tesla stock fell 2.3% on Friday, extending a losing streak to five sessions. Shares of the electric vehicle giant are meeting strong resistance around their 200-day line.
Tesla stock is about 30% off its 52-week high. Its 3-for-1 stock split is scheduled for Wednesday.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares sold off 2.3% on Monday as the stock continues to build the right side of a cut base that has a buy point of 179.71. Another interpretation could be a large double bottom that dates back to January. Either way, the point of purchase is the same. The last three days of losses could be the first part of a potential handful, which would offer a lower entry.
On the upside, the stock’s relative strength line is holding new highs, indicating strong stock market outperformance.
Microsoft fell 2.9% on Friday, extending a losing streak to five sessions and moving further away from its 200-day line.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen to learn more about growth stocks and the Dow Jones Industrial Average.
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