Dow Jones futures were squarely lower after Monday’s stock market action. The Federal Reserve’s two-day meeting begins Tuesday, followed by an interest rate policy decision Wednesday afternoon.
End of Monday, Apple chip maker NXP Semiconductors (NXPI) reported strong second quarter results, but the stock still fell nearly 2% in extended trading. NXP stocks are on a new footing after a sharp recovery from recent lows. Meanwhile Dow Jones discount giant walmart (WMT) fell more than 9% after lowering its earnings outlook for the current quarter and full year.
Then tech earnings will heat up this week, with reports coming out from Alphabet (GOOGL), Amazon.com (AMZN), Apple (AAPL), Metaplatforms (META) and Microsoft (MSFT).
Alphabet and Microsoft will report after the market close on Tuesday. Meta earnings are due out on Wednesday. Amazon and Apple earnings are Thursday.
Stock market today
On Monday, the Dow Jones Industrial Average rose 0.3% and the S&P 500 rose 0.1%. And the tech-heavy Nasdaq composite narrowed its decline to 0.4%, extending losses from Friday’s decline.
US stock market overview today
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Last update: 4:54 PM ET 7/25-2022
Among exchange-traded funds, the Nasdaq 100-tracker Invesco QQQ Trust (QQQ) fell 0.6% and the SPDR S&P 500 ETF (SPY) fell 0.1%.
Tesla (TSLA) slipped 1.4% on Monday. Under the Dow Jones leaders, Apple and Microsoft lost 0.7% and 0.6% respectively in the current stock market.
In the volatile stock market environment, Dow Jones stocks UnitedHealth (UNH) — as well as ELF Beauty (ELF), Quanta Services (PWR), Ulta Beauty (ULTA), Verra Mobility (VRRM) and Vertex Pharmaceuticals (VRTX) — are among the stocks to watch. Keep in mind that continued volatility in stock markets is a reason to remain more conservative despite recent signs of strength.
UnitedHealth and Vertex are IBD Leaderboard stocks. ELF and Ulta were featured in the Stocks near a buy zone column this week.
Dow Jones Futures Today: Treasury Yields, Oil Prices, Fed Meeting
After Monday’s close, Dow Jones futures fell 0.4% and S&P 500 futures fell 0.3% relative to fair value. Nasdaq 100 futures fell 0.4% from fair value. Keep in mind that an overnight action in Dow futures and elsewhere does not necessarily lead to actual trading in the next regular trading session.
The yield on 10-year government bonds tapped higher on Monday and closed at 2.82%. Meanwhile, US oil prices recovered about 2%, while West Texas Intermediate traded near $97 a barrel.
The Fed’s two-day meeting begins on Tuesday. Wall Street expects the central bank to aggressively raise interest rates through the end of the year — then turn around and start cutting in six months. Another 75 basis point rate hike is expected on Wednesday.
What to do in the current stock market rally?
Individual stock action has largely improved in recent trading sessions, which is a good start in a sluggish stock market rally. However, be more conservative and keep the positions small when it comes to new purchases. Don’t increase exposure too quickly, especially in the midst of a lot of uncertainty. Friday’s sell-off in the market reiterates the importance of being more cautious at this point.
Friday’s The Big Picture column noted: “Several distribution days fell off the count on Thursday, a positive for the nascent uptrend. Despite solid weekly gains for the indexes, the uptrend remains under pressure. Indices face resistance around round numbers; 12,000 for the Nasdaq composite, 4,000 for the S&P 500 and 32,000 for the Dow Jones.”
If you’re new to IBD, consider checking out CAN SLIM’s stock trading system and basics. Recognizing chart patterns is a key to investment guidelines. IBD offers a wide variety of growth stock lists such as Leaderboard and SwingTrader.
Investors can also create watchlists, find companies approaching a buying point, or develop custom screens at IBD MarketSmith.
Four Dow Jones Stocks to Watch Now
Dow Jones Stocks to Watch: UnitedHealth
Health insurance giant and IBD Leaderboard stock UnitedHealth is in the buy range above the 518.80 buy point of the double bottom handle base after Monday’s 1.55% gain, according to IBD MarketSmith chart analysis.
UNH stocks show a solid 95 out of a perfect 99 IBD Composite Rating, according to the IBD Stock Checkup. Investors can use the IBD Composite Rating to easily measure the quality of a stock’s fundamental and technical statistics.
4 top growth stocks to keep an eye onrent Stock Market Rally
Top Stocks to Watch: ELF, Quanta, Ulta, Verra, Vertex
ELF Beauty is back under a 33.54 point buy in a handle cup after a recent slip. The RS line hit a new high last week, which is a sign of a major outperformance in the stock market. ELF shares rose 0.5% on Monday after Stifel Nicolaus raised his price target from 29 to 34.
Quanta Services is finalizing a head-and-handle base with a buy point of 138.56, according to IBD MarketSmith chart analysis. Meanwhile, an early entry of 133.68 is also in play. The stock was up 0.5% on Monday.
IBD Big Cap 20 stock Ulta Beauty builds a flat base with 429.58 buy points. The base comes in the wake of a botched breakout past a handle cup’s 426.93 entry in June. In recent weeks, the stock has resolutely regained its 50-day line, paving the way for a new buying point. Ulta shares fell 1.3% on Monday.
Verra Mobility continues to trade under a cup with a buy point of 16.83 off the handle in the wake of Monday’s 0.4% gain. The stock’s RS line continues to show tremendous strength as it hit another new high last week.
IBD Leaderboard stock Vertex Pharmaceuticals is testing the 279.23 buy point of a head-and-handle amid a two-week pullback in stocks, according to the IBD MarketSmith chart analysis. The biotech leader is in 5% buying territory rising to 293.19 amid Monday’s 1.2% gain. But investors should wait for a decisive sign of support before buying the stock.
Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live
Tesla shares slipped 1.4% on Monday, breaking an eight-day earnings streak and returning a small portion of last week’s profit-driven 13.4% gain.
Shares are at their highest level since early May but are still about 35% off a 52-week high.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares fell 0.7% on Monday, compounding Friday’s losses. Apple remains above its 50-day mark after bullish action in recent weeks. The stock remains below its long-term 200-day mark, which is looming as a resistance level to watch. The stock is about 17% lower than its 52-week high.
Microsoft fell 0.6% Monday, falling back below the 50-day line. The stock closed about 26% from its 52-week high.
Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.
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