Dow Jones futures were higher ahead of Tuesday’s open and the US election. Core inflation data, including the Consumer Price Index, is due later in the week.
Republicans are almost certain to retake the House of Representatives in Tuesday’s midterm elections. They appear to have the edge to win the Senate, although that is less clear. Democrats currently hold a slim majority in the House, with Vice President Kamala Harris holding a 50-50 tie in the Senate.
As of Thursday, the Consumer Price Index is expected to have risen 0.7% in October compared to the previous month. Consumer inflation is expected to increase by 8% annually.
Diamondback Energy (ANIMAL TOOTH), Lyft (LYFT), Mosaic (MOS) and Shockwave Medical ( SWAV ) were the key earnings reporters late on Monday.
FANG stock traded a fraction lower in extended trading, while Lyft shares fell more than 16%. Mosaic shares rose. And Shockwave shares lost more than 5%.
Stock market today
On Monday, the Dow Jones industrial average rose 1.3%, or more than 400 points, and the S&P 500 gained 1%. The tech-heavy Nasdaq composite climbed 0.85%.
Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust ( QQQ ) rose 1.1% and the SPDR S&P 500 ( SPY ) rose 0.9%.
EV giant Tesla ( TSLA ) fell 5% on Monday. Among Dow Jones stocks, apple ( AAPL ) rose 0.4% and Microsoft (MSFT) jumped 2.9% in today’s trading.
Among the top stocks to buy and watch, Albemarle (ALB), IBD Leaderboard Watch List Stock Arista Networks (A NET), CF Industries (CF) and Energy New Fortress (NFE) — as well as Dow Jones names Merck (MRK) and UnitedHealth Group (UNH) — are among the top stocks to buy and watch.
Arista Networks is an IBD Leaderboard Watch List stock. Albemarle was featured in this week’s Stocks Near a Buy Zone column, along with three other top stock ideas.
4 Top Growth Stocks to Buy and Watch at Current Stock Market Rally
Dow Jones Futures Today: Bond yields, oil prices
Ahead of Tuesday’s opening session, Dow Jones futures, along with S&P 500 and Nasdaq 100 futures, were little changed against fair value. Remember that overnight action in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
The yield on the 10-year note rose to 4.21 percent on Monday, extending its winning streak to four sessions and closing at its highest level since Oct. 24. . Last week, WTI futures hit their highest point since mid-October.
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3rd quarter earnings Time
Third quarter earnings season continues this week, with more key reports coming from Disney (DIS), DoubleVerify (DV), Dr. Horton (DHI), West (ACID) and Roblox (RBLX).
Earnings reports cause many of the biggest moves in stocks and require special focus. Strong earnings can propel top stocks above new buy points and into buy zones, while a less-than-impressive announcement can send stocks falling below key support levels.
The stock market’s reaction to an earnings release can often tell you more than the earnings themselves. If results look strong but the stock falls anyway, investors may be concerned about the sustainability of growth, rising costs or other potential downsides.
With the market in rally mode, investors should watch for companies that easily beat earnings results and have strong bullish reactions. These stocks could be among the new leaders if the market can recover from its recent losses.
What to do in the struggling stock market rally
Now is an important time to read IBD’s The Big Picture column after the stock trend has shifted from a “confirmed uptrend” to a “pressured uptrend.”
At this point, investors should play defense. don’t let profitable trades turn negative. As The Big Picture reiterated last week, it makes sense to keep exposure at or below 20% until the uptrend continues.
But it’s not time to walk away completely. The uptrend remains intact, so investors can still buy breakouts, but should focus on stocks with top fundamental and technical metrics.
(Check out IBD stock lists, such as the IBD 50 and Stocks Near A Buy Zone, for additional stock ideas.)
Five Dow Jones Stocks to Buy and Watch Now
Dow Jones Stocks to Watch: Merck, UnitedHealth
Dow Jones member and IBD 50 stock Merck is out of range, beyond the 93.12 double-bottom buy point. The 5% buy range rose to 97.78.
Healthcare giant UnitedHealth continues to eye a cup with the handle’s 553.23 buy point, according to IBD MarketSmith, following last week’s breakout attempt. Shares rallied 1.3% on Monday, closing about 1% below the stock’s last entry.
Top stocks to buy and watch: Albemarle, Arista, CF, New Fortress
Lithium producer Albemarle is making the right side of a cup base that has a buy point of 308.34. Shares rose 0.5 percent on Monday, extending a three-session winning streak.
IBD Arista Networks Leaderboard Watchlist stock is trying to break through the base’s erratic buy point of 132.97. Shares fell 0.4% on Monday.
CF Industries is trying to find support around its 50-day moving average amid Monday’s 1% loss. Shares are building a cup base that has a buy point of 119.70, according to IBD MarketSmith standard recognition.
New Fortress Energy is fast approaching the 63.16 buy point of a cup base. With the stock about 6% away from new highs, watch for a handle to offer an earlier entry. The energy leader reported results late on Monday, sparking a 1.5% gain on the day.
Join IBD’s experts as they analyze top stocks in the current stock market rally on IBD Live
Tesla stock fell 5% on Monday, hitting a new 52-week low and hitting its lowest level since June 2021.
Shares are more than 50% off their 52-week high and well below their 50- and 200-day moving average lines.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares rose 0.4% on Monday, despite the company’s warning that it has cut iPhone 14 production due to Covid-19 restrictions in China. Apple stock ended a five-day losing streak but is still about 24% off its 52-week high.
Microsoft jumped 2.9% on Monday, continuing its recovery from Friday’s 52-week low. The software giant remains about 35% off its 52-week high.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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