Futures contracts mix as oil prices slide; Tesla improved, BioNTech rallies
S&P 500 and Dow Jones futures slipped to a mixed open on Monday, after the double warning from Goldman Sachs and a UN climate panel left global markets on alert. Tesla has rallied around an analyst upgrade. BioNTech topped the list of IBD rankings after a dazzling report in the second quarter. And Walmart rose within a buy range on the Dow Jones today.
Dow Jones futures reduced expected losses to 0.2%. Futures on the S&P 500 reduced declines to less than 0.1% below fair value, with oil stocks posting nine of the index’s 10 worst declines. Nasdaq 100 futures defended a fractional gain on the scholarship today, like You’re here (TSLA) advanced and NetEase (NTES) led the rebound for names based in China.
Tesla topped the Nasdaq 100, up 1.5% after posting a seven-day rebound on Friday. Improved Jefferies Tesla shares to buy, from the wait, by bringing the price target to 850, against 700. Tesla is also a IBD Ranking Stock.
Flea stocks showed strength early on, with ASML Holding (ASML) up 0.9%, while the Shares Semiconductor ETF (SOXX) increased by 0.3%. A ranking and an IBD 50 list, ASML is extended and in an option profit taking zone.
Dollar tree (DLTR) fell to the bottom of the Nasdaq 100, down 1.7% following a downgrade of Deutsche Bank. The note also lowered the share price target to 102, from 129, citing inflationary pressures from transportation costs and wages.
At the top of the S&P 500, maker of generic drugs Viatris (VTRS) increased by 3.9% and Tyson Foods (TSN) rose 2.5% after the earnings release. Other profit-fueled moves included a 9.9% gain for Medical shock wave (SWAV) and Scientific games (SGMS), up 8.6%.
Supplier of construction products Select interior concepts (CIS) climbed 29% after private equity firm Sun Capital Partners announced it would acquire the Georgia-based company for $ 411 million.
Dow Jones Today: Chevron, Walmart, Microsoft
Boeing (BA) decreased by 1.2%, Chevron (CVX) slipped 0.9%, to today’s Dow Jones low. Walmart (WMT) topped the list, up 0.6% in pre-market trade. Walmart Stocks held a seven-week rally through Friday, topping an entry of 144.68 in a 10-week flat base. The stocks remain in a buy range up to 151.91.
Microsoft (MSFT) stocks rose 0.1%. Microsoft actions is extended after a breakout in June, but formed a shelf model with an entry at 290.25. Shelf models provide follow-up opportunities to add existing positions, but are not recommended for opening a new position in a stock.
IBD 50, ranking: BioNTech, FreedomHolding
At the top of the IBD 50 list, Maintenance of freedom (FRHC) added 2.5%. The Kazakhstan-based financial network was supported at its 21-day exponential moving average, about 7% below an entry of 68.90 in five weeks flat base.
BioNTech (BNTX) easily topped the IBD rankings list, climbing over 5% after reporting huge sales and profits for its second quarter. BioNTech is in a profit taking zone after a breakout in July, and is showing signs of a climax.
Goldman halves China’s outlook
A Goldman Sachs report released on Sunday significantly slashed the investment bank’s growth forecast in China, amid mounting pressure from the latest round of coronavirus infections. The forecast now calls for GDP growth of 2.3% in the third quarter, less than half of an initial projection of 5.8% growth. Annual growth is now 8.3%, compared to 8.6%. Bloomberg reported that the cuts follow similar changes made by Nomura earlier in August.
In addition, a UN climate panel on Monday issued a warning that “unequivocal” changes caused by man-made greenhouse gases are accelerating to irreversible levels. The The Wall Street Journal said the report underscored “human responsibility for record heat waves, droughts, more intense storms and other extreme weather events observed around the world in recent years.” It also refines estimates of the climate’s sensitivity to rising atmospheric levels of carbon dioxide and other greenhouse gases – a key metric for predicting rising global temperatures in coming years. “
Vital signs: oil, bond yields, Bitcoin
Crude oil prices fell after Goldman’s publication, with West Texas Intermediate futures plunging more than 4%, to below $ 66 a barrel. WTI plunged 7.7% last week, sending prices back to retest recent lows, below their 10-week moving average.
The 10-year bond yield traded at 1.28%, down from Friday’s 1.29%. A four-day lead through left Friday yields more than 4% for the week, breaking a string of 10 losses in the past 11 weeks.
Bitcoin rose above $ 45,000, the highest level since May. Bitcoin peaked above $ 64,829 in mid-April.
Chinese markets rebound, Europe is mixed
Chinese markets had a good day, with the Hong Kong Hang Seng Index up 0.4% and the Shanghai Composite up 1%. In Japan, Tokyo’s Nikkei 225 added 0.3%.
Among Chinese gauges in the United States on Friday morning, the iShares MSCI China ETF (MCHI) climbed 1.2%, and the Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR) climbed 1.4%. KraneShares CSI China Internet ETF technology tracker (KWEB) rose 1.1% in early trade.
European markets were mixed around mid-session. The CAC-40 in Paris traded flat. The Frankfurt DAX plunged 0.1%. London’s FTSE 100 fell 0.4%. The ETF SPDR Portfolio Europe (SPEU) was inactive at the start of the trading day, after falling 0.6% on Friday. ETF is up 0.9% in August, has a 14.4% year-to-date gain and is trading just below a buy point of 44.06 on a flat basis eight weeks.
S&P 500, Dow Jones today
The Dow Jones gained a break today after hitting a new high as well as a new closing high on Friday. The SPDR Dow Jones Industrial Average ETF Trust (DIA) is in a buy range above a buy point of 348.75 in a double bottom basis. The leveraged ProShares UltraPro Dow30 (UDOW) is approaching the top of a buy range above a baseline double-bottom entry at 75.52.
The biggest winners in the Dow Jones last week were investment banks, rallying to the rebound in bond yields. Goldman Sachs (SG) jumped 6.1%. JP Morgan (JPM) gained 3.1%. Goldman Sachs is in a buy range after breaking a flat-based buy point at 393.36.
Walt disney (SAY) is the only blue chip to be released this week, with results due Thursday evening. Disney shares are trying to create a bottom in a three-month consolidation.
For a more detailed analysis of the current stock market and its state, study the big picture.
The S&P 500 also set a new high and closing highs on Friday, taking a 0.9% gain for the week. The index has a gain of 0.9% for the month and is aiming for a seventh consecutive monthly increase.
The index’s strongest gains for the week came from Under protection (UAA) and supplier of medical supplies Invacare (IVC). Each recovered about 22% after their earnings reports, both stopping before breakouts.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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