Wednesday morning Dow Jones futures rose slightly, along with S&P 500 and Nasdaq futures. The stock market rally suffered sharp losses on Tuesday, as the Nasdaq and S&P 500 broke through to a key low.
Tuesday’s economic reports revived recession and inflation fears. Report for Intel Corporation (INTC) lowered chip prices due to weak personal computers and criticized shares of Intel and its competitor Advanced Micro Devices (AMD), as well as PC makers and Microsoft (MSFT).
XOM stock rose modestly on Tuesday, flirting with intraday buy signals after the diversified energy giant held out better than most oil and gas operations. VRTX stock fell below a buy point. ENPH stocks fell inside the handle as solar stocks dwindled. Google and Tesla stock fell solidly below the recent buying points.
The video included in this article highlights Exxon Mobil, Google, and VRTX stocks.
In other news, the grain giant general mills (GIS) reported better-than-expected earnings and sales for the fourth quarter of the fiscal year. GIS stock is up modestly ahead of the opening after reversing lower on Tuesday, returning just above the 50-day line within a shallow Cope base.
Dow jones futures contracts today
Dow futures are up 0.4% against fair value. S&P 500 futures rose 0.3% and Nasdaq 100 futures rose 0.3%.
The 10-year Treasury yield fell 6 basis points to 3.15%.
Crude oil prices rose more than 1%.
Bitcoin has dropped to just over $20,000 again.
stock market rise
The stock market opened higher, buoyed by China reducing quarantine times for incoming travelers. But the major indicators quickly faded, led by the Nasdaq.
The Dow Jones Industrial Average fell 1.6% on Tuesday stock market trading. The S&P 500 fell 2%, and ENPH stock was among the worst performers. The Nasdaq Composite Index is down 3%. Small cap Russell 2000 fell 1.85%.
Two economic reports reached the market at 10 a.m. ET. The June consumer confidence index fell to its lowest point since February 2021, while its forecast gauge hit a nine-year low. The gauge of inflation expectations reached a record high dating back to 1987. Meanwhile, the Richmond Fed’s manufacturing index was much weaker than expected, the latest negative report for the regional factory ahead of Friday’s US ISM manufacturing index.
Intel is said to be slashing the prices of Alder Lake processors by PC makers’ orders are much weaker than expected. Intel stock sank 2.2%. Archrival AMD stock sold 6.2%, its lowest close in a year and just above its June 17 low. Dell Technologies (Del) And the HP Inc. (HPQ) both lost 2.6%. Windows maker Microsoft Corp. fell 3.2 percent.
US crude oil prices rose 2% to $111.76 a barrel. OPEC+ will hold its last meeting from Wednesday
The 10-year Treasury yield rose one basis point to 3.21%.
between the Best ETFsThe Innovator IBD 50 ETF (fifty) is down 2%, while the Innovator IBD Breakout Opportunities ETF (fit) gave up 2.1%. iShares Expanded Technology and Software Fund (ETF)IGV) fell 3.7%, with Microsoft stock taking the lead. VanEck Vectors Semiconductor Corporation (SMH) fell 2.5%, with major Intel and AMD stock components.
SPDR S&P Metals & Mining ETF (XMEand Global X US Infrastructure Development ETFcradle) both fell 1.7%. US Global Gates Foundation (ETF)Planes) gave up strong opening gains to fall 0.8%. SPDR S&P Homebuilders ETF (XHB) lost 2.1%. SPDR Specific Energy Fund (SPDR ETF)XLE) up 2.7%, and XOM stock was a huge component. SPDR Financial Choice Fund (SPDR)XLF) down by 1%. SPDR Healthcare Sector Selection Fund (XLV) with VRTX stock, down 1.7%.
stock to watch
Exxon Mobil stock rose to 93.24 on the day, moving above the 50-day and 21-day lines while also breaking a sharp downtrend. That made a solid entry. XOM stock pared gains to close 2.8% higher at 91.50, but held above the 50-day line. Exxon stock has held out better than many oil and gas operations trying to bounce back from the 200-day streak. However, investors would ideally like to see XOM move sideways for a while and form a new base before attempting to intervene.
Vertex stock fell 3.9% to 276.17, below the early entry of 279.23 after hitting 293.17 on Friday. VRTX stock is still doing well, with Tuesday slipping in lighter volume, and after a string of big gains over the past week. But it is worth watching. The line relative force VRTX stock is still near the highs.
Enphase stock fell 7.5% to 190.65, once again finding support around the 21-day moving average. ENPH stock is still inside a handle deep inside a file double bottom base. The official buy point is 217.33, although investors may use the movement above Monday’s high of 210.10 as an early entry. But stocks for ENPH and other solar toys are volatile, a trait that is difficult to deal with in the current market climate.
Tesla stock fell 5% to 697.99 again below its 21-day moving average. On Monday, TSLA stock reversed slightly lower after hitting resistance at the 10-week line. Unlike most big stocks, Tesla stock settled above its late-May lows in June. Late this week, maybe Saturday, Tesla will release delivery numbers in the second quarter That should show a significant drop compared to the first quarter, reflecting a factory shutdown in Shanghai and a slower recovery.
Tesla is closing an office in San Mateo, California, eliminating 200 low-level jobs from the Autopilot team as part of the EV giant’s ongoing comprehensive layoffs. CEO Elon Musk, who fears a possible recession, has repeatedly promised full self-leadership “this year” for nearly a decade. Tesla’s fully autonomous driving system, which costs $12,000, is a Level 2 driver assistance system, apart from the Level 5 autonomous driving system.
Google stock fell 3.3% to 2,240.15, returning below the 50-day moving average after clearing that key level on Friday. GOOGL stock also avoided cutting its May lows in a massive market sell-off for June.
Market Rise Analysis
The major indices started with good gains on Tuesday but quickly turned lower. The Dow Jones, S&P 500 and Nasdaq Composite are again below their 21-day moving averages.
The Nasdaq and S&P 500 fell below Friday’s lows Follow-up day. This is a very bearish signal. Research shows that there is a 90% chance that the rally will eventually fail when this occurs. The rally is not officially over until indices break their recent lows.
The Dow Jones index did not close below its follow-up day lows, but it’s not far off.
There were a lot of ugly setbacks on Tuesday and stocks fell back or below key levels.
Many huge companies, not just Tesla and Google stocks, have faced resistance around the 50-day or 10-week streaks, including MSFT stock, apple (AAPL) And the Amazon.com (AMZN). So do the XLV and ARKK ETFs.
The day for blue-chip stocks wasn’t a good one, with broad weakness. Pharmaceutical stocks tumbled, despite being defensive growth names. The health insurers didn’t lose much ground, but they gave up some bullish opening gains.
Oil and gas stocks may rebound, but after rebounding from their lows late last week, many may need time to fix them. XOM stocks look better, but even energy names can suffer if the broad market sells out.
What are you doing now
With the rapidly rising market facing selling pressure, investors should not add exposure, which should already be light. Instead, they may want to peel off some new situations. Many, like VRTX stock, are likely underwater with the Nasdaq below the FTD low and the S&P 500 almost there.
Like driving in foggy conditions, it’s hard to know what awaits the stock market, but the stakes are high.
Keep working on watch lists. Stay engaged and ready for action.
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