Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, were little changed following Monday’s stock market sell-off on rising Covid-19 fears. Tech giant Netflix is set to report earnings late Tuesday.
On Monday, the Dow Jones Industrial Average plunged 2.1%, or 725 points. The S&P 500 sold off 1.6%, while the Nasdaq dropped 1.1%.
Among the Dow Jones leaders, Apple (AAPL) tumbled 2.7% Monday, while Microsoft (MSFT) moved down 1.3% in today’s stock market. Coca-Cola (KO) and McDonald’s (MCD) are near buy points. IBM (IBM) beat earnings estimates after the close.
Microsoft and Tesla are IBD Leaderboard stocks. BioNTech is an IBD SwingTrader stock. AMD was featured in this week’s Stocks Near A Buy Zone column, while AutoNation was Monday’s IBD Stock Of The Day.
Dow Jones Futures Today: Covid-19 Fears
After the stock market close Monday, Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, were little changed vs. fair value. Remember that trading in Dow Jones futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
The recent resurgence in Covid-19 cases in many parts of the world — including highly-vaccinated countries like the U.K. — could hamper economic growth. In the U.S., coronavirus cases jumped 37% over the last seven days to 203,082, according to Worldometer.
Meanwhile, OPEC+’s Sunday agreement to end production limits also weighed on the major stock indexes. U.S. crude oil futures plunged nearly 8%, the lowest level since May. Dow Jones oil stocks Exxon Mobil (XOM) and Chevron (CVX) lost 3.4% and 2.7% respectively.
Among exchange traded funds, the Innovator IBD 50 (FFTY) inched higher Monday. Nasdaq 100 tracker Invesco QQQ Trust ETF (QQQ) declined 0.8% Monday. Meanwhile, the SPDR S&P 500 ETF (SPY) descended 1.5%.
Stock Market Rally Weakens
The S&P 500 continued to pull back from record highs Monday, while the Nasdaq extended a losing streak to five sessions. The Dow Jones industrials pierced their 50-day moving average with sharp losses Monday.
Friday’s Big Picture column noted, “An early rebound attempt quickly deflated into another day of losses for stocks today. The weakening action, not just among key indexes but also vital sectors this year, prompts a more cautious stance.”
For more stock market commentary, check out IBD’s The Big Picture.
Dow Jones Stocks To Buy And Watch: Coca-Cola, McDonald’s
Dow Jones stocks Coca-Cola and McDonald’s are near new buy points despite Monday’s stock market sell-off. Coca-Cola is trading about 2% away from a 56.58 buy point in a flat base following Monday’s 1.2% fall.
McDonald’s is trading below a 238.28 buy point in a flat base, according to IBD MarketSmith chart analysis, after Monday’s 2.3% drop. The stock closed below its key 50-day moving average.
Dow Jones Earnings: IBM
Dow Jones stock IBM reported strong Q2 results after the close Monday. The company reported adjusted EPS of $2.33 on sales of $18.7 billion.
Shares jumped nearly 4% in extended trade Monday. IBM stock is tracing a flat base with a 152.94 buy point.
After the stock market close Tuesday, Netflix earnings are set to be reported. The FANG stock leader is expected to earn $3.18 a share on sales of $7.3 billion, representing increases of 100% and 19%, respectively, vs. the year-ago period.
Last quarter, earnings soared 139% on revenue of $7.1 billion.
Netflix stock continues to build a double bottom with a 563.66 buy point. Shares ended Monday up 0.4% and are about 6% away from the buy point.
So far, the stock hasn’t participated in this year’s stock market rally. Year to date, Netflix stock is down 1.5%, while the Nasdaq is up more than 10% through Monday’s close.
Stocks To Buy And Watch: AMD, BioNTech, AutoNation
Chip giant Advanced Micro Devices is tracing a cup with handle that shows a 95.54 buy point, according to IBD MarketSmith chart analysis. Shares rallied 0.8% Monday.
According to the IBD Stock Checkup, AMD stock shows a solid 95 out of a perfect 99 IBD Composite Rating. The IBD Composite Rating identifies stocks with a blend of strong fundamental and technical characteristics.
IBD Leaderboard stock BioNTech is rebounding from its 50-day moving average, but the Covid-19 vaccine stock is now out of a new buy area following Monday’s 4.8% rally. Per Leaderboard analysis, BioNTech cleared a trend line following a pullback near 222, offering a new entry at a similar price level as the 50-day line.
BioNTech is also an IBD SwingTrader stock.
Monday’s IBD Stock Of The Day, AutoNation, is trying to break out past a 107.07 buy point after the company’s strong Q2 earnings results ahead of the open. Shares closed just below the buy point amid Monday’s 3.65% advance.
Bullishly, the stock’s RS line is just off new highs, indicating substantial stock market outperformance vs. the broad market. The RS line should hit a new high on the breakout day or shortly thereafter.
Tesla stock reversed 0.3% higher Monday, snapping a four-day losing streak. The electric-vehicle giant is again testing support around its long-term 200-day moving average. Another strong show of support at these levels would be bullish for the stock’s prospects.
On Jan. 25, Tesla stock hit a record high at 900.40, after climbing as much as 93% from a 466 buy point in a cup with handle.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple sold off 2.7% Monday, extending a losing streak to three sessions. The stock hit an all-time high last week at 150.00.
Apple stock is falling back into the 5% buy zone from a 137.17 entry in a cup base, according to IBD MarketSmith chart analysis.
Microsoft continues to trade solidly above a cup base’s 263.29 buy point. Shares lost 1.3% Monday. The stock is extended above the 5% buy zone, which goes up to 276.45.
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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