Stock futures held onto narrow gains Wednesday, after Tesla, Apple and Amazon.com led a reversal off early lows. Global markets were largely quiet, generally lower, ahead of the Federal Reserve’s rate policy announcement this afternoon. Tesla topped the Nasdaq 100, while Apple stock led the Dow Jones today — both on price-target hikes.
Nasdaq 100 futures led, swinging 0.7% above fair value. Dow Jones futures and S&P 500 futures shed losses and edged into gains of 0.1% and 0.3%, respectively, on the stock market today. The stock market rally continued Tuesday, as the Nasdaq sneaked briefly back above the 10,000 mark. The index stealthily added a third day to its rally as the Dow industrials, S&P 500 and the Russell 2000 pulled back.
Oil stocks, airlines and cruise lines packed the bottom of the S&P 500 in premarket trade. Auto drive-train components maker Aptiv (APTV) rebounded 4% to lead the index. Amazon.com (AMZN) also traded near the top of the S&P 500, up 1.4% and working on its sixth-straight weekly advance. Amazon is in a buy range above a three-weeks-tight buy point of 2,525.55.
Tesla (TSLA) spiked almost 6%, to the top of the Nasdaq 100. Wedbush calibrated a new buy point at 1,000, up from 800, based on Model 3 demand in China and easing lockdowns in the U.S. and Europe. Reuters also reported that Tesla Chief Executive Elon Musk pushed the company’s Semi truck toward volume production, with battery and power-train production slated for the Giga Nevada facility.
Also high in the Nasdaq 100 mix, China’s NetEase (NTES) gained 1.6%. Advanced Micro Devices (AMD) climbed 1.8%, closing in on a buy point at 58.73.
Gear up for Wednesday’s market action by reading IBD’s Investing Action Plan.
Earnings News: Lakeland, Five Below Rally
Lakeland Industries (LAKE), a maker of safety garments and accessories, spiked more than 40% after reporting an 85% revenue surge and a four-digit earnings increase due to demand created by the Covid-19 pandemic. Benchmark initiated coverage on the stock early Tuesday, with a buy rating and a price target at 24. Shares ended Tuesday at 16.02, and were trading at 24.10 in premarket action.
Lakeland’s gain helped another maker of protective gear, Canada-based Alpha Pro Tech (APT), which vaulted more than 19% in premarket trade.
Dollar-store retailer Five Below (FIVE) sprinted 12% higher, although both earnings and revenue missed analyst targets in its first-quarter report. Three analysts raised price targets and maintained buy ratings. One upgraded the stock to buy, based on rising e-commerce sales and the potential for a growth spurt in the remainder of the year.
Online pet-food leader Chewy (CHWY) trimmed its early loss to 0.8%, following better-than-expected first-quarter revenue, and losses that came in below analyst estimates.
Fed Policy Pending, May CPI Dips
The Federal Reserve’s rate policy announcement may well provide a hub for the day’s market session. The Fed intends to release quarterly economic projections for the first time since the onset of the pandemic, amid rising interest rates as the Fed pares back its stimulus bond-buying efforts.
The Fed makes it rate policy announcement at 2 p.m. ET, followed by a press conference with Federal Reserve Chairman Jerome Powell at 2:30 p.m. ET.
The Labor Department’s Consumer Price Index dipped 0.1% in May, weaker than the flat reading expected by economists, but well short of the record 0.8% decline recorded in April. Food and energy had little impact on the result, with Core CPI also down 0.1%, vs. analyst views for a 0.1% increase.
The Energy Information Administration delivers its weekly oil inventories numbers at 10:30 a.m. ET.
Apple Leads Dow Jones Today On Price Target Hike
Boeing (BA) and Exxon Mobil (XOM) dragged at the bottom of the Dow Jones today, down 2.3% and 1.1%, respectively.
Pfizer (PFE) and Apple stock were on the rise. Apple jumped 1.2% after Deutsche Bank hoisted the stock’s price target to 350, from 320. Apple rose Tuesday on reports that the company was preparing to shift its Mac products to processor technology licensed from ARM, a unit of Japanese tech conglomerate SoftBank Group (SFTBY), Bloomberg said. The Deutsche Bank note said the transition was not likely until 2021.
Apple, an IBD Leaderboard stock, is extended above a 319.79 buy point.
Pfizer shares gained 0.5% after the company reported positive results in phase 3 trials of its dermatitis treatment abrocitinib.
Coronavirus Watch: Texas, Arizona See Active Cases Rebound
The global cumulative total for coronavirus cases rose 1.7% to above 7.34 million in the 24 hours leading to Wednesday morning. More than 5,000 deaths were reported, a 1.2% increase that raised the total persons killed by the virus to 414,124. Brazil confirmed 31,197 new cases, far more than any country in the world, a 4.3% increase, putting its cumulative total at 742,084. That’s second to the U.S. in terms of total cases, according to Worldometer.
The U.S. saw 19,118 new cases during the 24-hour period, slowing its total case growth to 0.9%. The cumulative total of U.S. cases approached 2.05 million. The death toll increased by 1,090, up about 1%, to 114,151. The number of active cases in the U.S. rose for a fourth day, to more than 1.14 million. These are confirmed infected patients under hospital care or observed home quarantine. The number had peaked on May 30, pulled back until June 4, then rebounded.
States led by Texas, the Carolinas, California, Oregon, Arkansas, Mississippi, Utah and Arizona have reported increasing numbers of infected patients since the Memorial Day weekend, according to the Washington Post. New cases are up 36% in Texas since the holiday, where Covid-19 hospitalizations reached records levels on Monday and Tuesday.
Arizona reported a 49% increase in hospitalizations over the same period, to record levels and nearing the state’s ICU capacity.
Dow Jones Today: A New Blue Chip Buy Point
The Dow industrials have seen a bit of a shakeout while the overall market has undergone some sector rotation. A chart scan across the Dow Jones today shows Apple (AAPL), Home Depot (HD) and Visa (V) have climbed away from recent buy points and are now extended.
Microsoft (MSFT) on Tuesday exited its long stay in a buy range above a 180.10 cup-with-handle entry. At the same time, it passed its prior record high. Aggressive investors could use that 190.70 marker, plus a dime, as an alternative entry and add to their positions. But Microsoft’s long slog out of the 180.10 buy range is not exactly lighting fires in the hearts of growth investors, and the stock’s relative strength line has been in a downtrend since mid-May.
For more detailed analysis of the current stock market and its status, study the Big Picture.
UnitedHealth Group (UNH) and Intel (INTC) remain in buy ranges. Intel first topped its entry almost four weeks ago. UnitedHealth first cleared its mark on May 28. UNH stock gained 0.6%, Intel traded down 0.4% in premarket trade on Wednesday.
One Dow Jones stock coiled neatly beneath a yet-untouched buy point is Nike (NKE). Nike stock ended Tuesday 3% below what to IBD MarketSmith chart analysis plots as a 105.72 buy point in a 21-week cup base. The base is 43% deep, a permissible depth for a bear market correction. Nike stock has been bumping up against resistance in quiet trade for the past five days.
Nike has a Composite Rating of 91, and its up/down volume ratio is a strong 1.6, suggesting upward price pressure on the stock. The company’s shares moved up 0.2% early Wednesday.
Find Alan R. Elliott on Twitter @IBD_Aelliott
YOU MAY ALSO LIKE:
Top Growth Stocks To Buy And Watch
IBD’s ETF Stock Market Strategy
IBD’s Long-Term Leaders
Get Full Access To IBD Stock Lists And Ratings
Looking For The Next Big Stock Market Winners? Start With These 3 Steps
Credit: Source link