Dow futures rose ahead of Tuesday’s open after the Dow Jones Industrial Average sold off by more than 480 points on Monday. Tesla stock fell on Monday after several reports said that Tesla plans to cut production of electric cars in China, where demand appears to be faltering.
The EV giant has refuted the reports, calling claims that it has reduced production in China untrue. Still, investors left the stock down more than 6% near today’s lows.
More Fed rate hikes to 2023?
The stock market headed south on Monday, as stronger-than-expected economic data stoked concerns that the Federal Reserve will continue aggressively raising interest rates next year due to a strong labor market. Early Monday, the ISM Services report came in better than expected, with a reading of 56.5 in November versus 54.4 in October. ISM Services is a measure of business conditions in the United States in the service sector. A reading above 50 indicates expansion and a reading below 50 indicates contraction.
Monday’s economic data came directly on the heels of Friday’s strong jobs report which showed employers added 263,000 jobs to the payroll while the unemployment rate held steady at 3.7% and wages jumped.
According to Nick Timeraus at The Wall Street Journal, “Federal Reserve officials have signaled plans to raise the benchmark interest rate by 0.5 percentage point at their meeting next week, but mounting wage pressures may prompt them to continue raising it to levels higher than investors currently expect.”
Timiraos continued, “Policy makers expect price pressures to subside appreciably next year, but rapid wage growth or rising inflation in the labour-intensive service sectors of the economy may prompt more of them to support a hike in their benchmark rate next year above the 5% currently expected by investors. “
The 10-year Treasury yield jumped to 3.59% on Monday, rebounding from last week’s sharp losses.
This week’s earnings reports include: Sports + Outdoor Academy (ASO), AutoZone (to avoid), from Broadcom (AVGO), respect (a hundred), Lululemon Athletica (Lulu), Initial deal breaker (OLLI) f Toll Brothers (TOL).
stock market today
On Monday, the Dow Jones Industrial Average lost 1.4%, or 482 points, and the S&P 500 fell 1.8%. The Nasdaq Composite Heavy Sold 1.9%. Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) was down 1.7% and the SPDR S&P 500 (SPY) was down 1.8%.
electric car giant Tesla (TSLA) stock was trading down 6.4% on Monday. Among Dow Jones stocks, apple (AAPL) decreased by 0.8% and Microsoft (MSFT) is down 1.2% in the stock market today.
Celsius (CELH), Chubb (CB), dexcom (DXCM) and Kosovo Liberation Army (KLAC) – as well as the names of Dow Jones Larva (cat), chevron (CVX) f Home Depot (HD) – Among the top stocks to buy and watch.
Dexcom is an IBD Leaderboard stock. In this week’s column, Caterpillar and Home Depot featured stocks near the overbought zone. Celsius was among the stocks to watch recently as a Class 50 IBD and a new stock in America. Caterpillar was Thursday’s stock.
4 growth stocks to buy and watch in Cursstock market rally
Dow futures today: oil prices
Before the opening bell on Tuesday, Dow Jones futures were up 0.1% against fair value, while S&P 500 futures were up 0.15%. Futures for the Nasdaq 100 Technology Industry Index rose 0.3% 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.
US oil prices pared early gains, falling more than 3%. West Texas Intermediate futures traded just above $77 a barrel. Crude oil prices initially rose after EU sanctions on Russian crude oil took full effect.
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What to do in the stock market
Now is an important time to read IBD’s Big Picture column with the stock market heading back into a ‘confirmed uptrend’.
While it’s true that the S&P 500 Composite and Nasdaq are still in confirmed uptrends, the lineup of actionable stocks has been disappointing. It wasn’t easy to increase exposure.
When it comes to new purchases, what kind of feedback do you get? Do new purchases make progress from purchasing points? In this case, it’s okay to give them some space. But do not be afraid to take partial profits if the profit reaches at least 10%. If new purchases go the wrong way, cut losses when the stock drops 3% to 4%, rather than waiting for the 7% rule to kick in.
Light and flexible trading is the best course of action at the moment. If the uptrend starts to gain traction again, there will be plenty of opportunities for increased exposure. And don’t be afraid to look for early entries, rather than waiting for the stock to reach a traditional buying point.
(Check out our lists of IBD stocks such as the IBD 50 and Stocks Near the Buy Zone, for additional stock ideas.)
Five Dow Jones stocks to buy and watch now
Dow Jones stocks to buy and watch: Caterpillar, Chevron, Home Depot
Dow Jones member Caterpillar Corp. is close to regaining 238 buy points for its cup base, According to IBD MarketSmith pattern recognition, it is approximately 2% lower than the entry level. CAT stock fell 1.5% on Monday.
CAT stock boasts a rating of 94 out of 99 IBD Composite Perfection rating, according to an examination of IBD stocks.
Energy giant Chevron fell 2.5% on Monday, dropping further below the 182.50 buy point on the consolidation base.
Home Depot, the home improvement retailer, ended Monday nearly 4% short of 333.08 buy points for the base of the cup following the stock’s 2.4% decline.
Top stocks to buy and watch: Celsius, Chubb, Dexcom, KLA
Energy drink maker Celsius fell 3.5% on Monday, snapping a three-day winning streak. The stock is trying to break through the 118.29 buy base of the cup, but it is almost 4% below the entry point, According to IBD MarketSmith Pattern Recognition.
Insurance giant Chubb is trading just under 216.10 points long for a cup with handle on Monday after losing 1.7% for the session. Buying space is 5%, high at 226.91.
IBD Leaderboard Dexcom stock is close to an alternative entry at 123.46 despite Monday’s drop of 1.3%. The shares are about 5% off their last buy point.
New long-term KLA leader IB continues to hold under 392.60 points to buy Cup handle amid a three-day losing streak, with shares down 0.25% Monday. The RS line continues to hold at new highs, which is a sign of the stock market’s leadership.
Join IBD experts as they analyze the leading stocks of the current stock market rally on IBD Live
Tesla stock fell 6.4% on Monday, snapping a three-day winning streak and giving up all of last week’s gains.
In recent weeks, the stock has reached its lowest level since November 23, 2020, and reached a new 52-week low of 166.19. Since then, the stock has rebounded but remains sharply below the 50- and 200-day moving average lines. Shares are down nearly 55% from their 52-week high.
Dow Jones leaders: Apple and Microsoft
Among Dow Jones stocks, Apple shares fell 0.8% Monday, but still held above the 50-day line. The stock is more than 20% off its 52-week high.
Microsoft stumbled 1.2% on Monday, as shares continued to hold above the 50-day line. The software giant is still about 27% off its 52-week high.
Be sure to follow Scott Lehtonen on Twitter at @tweet Learn more about developing stocks and the Dow Jones Industrial Average.
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