Dow Jones futures rose modestly Tuesday morning, as Q2 earnings begin to trickle out and Wall Street awaits Wednesday’s release of the consumer price index, or CPI. Best stocks to buy and watch include tech titans Meta Platforms (META) and Nvidia (NVDA).
Early Wednesday, Wall Street expects 0.3% monthly increases in both the overall and core CPI. The core CPI inflation rate, which strips out food and energy prices, could drop from May’s year-over-year rate of 5.3% to 5% or possibly lower, as the hefty 0.6% monthly rise in June 2022 falls out of the 12-month calculation.
Further, second-quarter earnings season kicks off this week, with Delta Air Lines (DAL), Cintas (CTAS) and Fastenal (FAST) set to report on Thursday. Earnings reports from big banks mark the official launch of the season on Friday, with JPMorgan Chase (JPM), Citigroup (C) and Wells Fargo (WFC) due to report.
Stock Market Today
Other stock market leaders include Alphabet (GOOGL) and Meta Platforms. GOOGL stock gained 0.5%, while Meta shares rose 0.3% in premarket trade.
Chipotle Mexican Grill (CMG), Dynatrace (DT), Meta Platforms, MongoDB (MDB) and Nvidia — as well as Dow Jones stocks American Express (AXP), Visa (V) and Salesforce (CRM) — are among the best stocks to watch in the current stock market pullback.
Dow Jones Today: Oil Prices, Treasury Yields
Ahead of Tuesday’s opening bell, Dow Jones futures rose 0.4% vs. fair value, while S&P 500 futures gained 0.3%. Nasdaq 100 futures climbed 0.35% vs. fair value. Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
The 10-year U.S. Treasury yield ticked lower to 3.96%, threatening to add to Monday’s losses. The yield settled Monday at 4.0%, halting a four-day win streak.
Oil prices bounced back Tuesday morning, after pulling back on Monday from their highest mark since early June. West Texas Intermediate futures traded up nearly 1%, to just below $73.50 a barrel.
Stock Market Action
On Monday, the Dow Jones Industrial Average rallied 0.6%, while the S&P 500 gained 0.2%. The tech-heavy Nasdaq composite also climbed 0.2%. Finally, the small-cap Russell 2000 advanced 1.6%.
Monday’s Big Picture column commented, “It’s OK to let your winners run in the current stock market environment, but be discerning with new buys and be careful not to chase extended stocks. It might be tempting to buy a leader like Super Micro Computer (SMCI), but it’s about 20% above its 10-week moving average. At this point, it’s best to wait for SMCI to form a new base.”
Now is an important time to read IBD’s The Big Picture column as the stock market holds near this year’s highs.
Dow Jones Stocks To Watch: American Express, Salesforce, Visa
American Express is building a cup-with-handle base that has a 177.04 buy point. Shares are 4% away from their entry following a 1.15% gain on Monday. AXP stock rose 0.2% Tuesday morning.
Salesforce is trying to steady itself after its post-earnings slump. It is now testing support at the 50-day line, and a decisive rebound would create a new buying opportunity. Meanwhile, a flat base with a 225 buy point is also in play, according to IBD Leaderboard analysis. CRM stock added 0.3% Tuesday morning.
Payments leader Visa closed further above a flat base’s 235.57 buy point Monday with a 0.7% gain. The buy range tops out at 247.35. V stock inched higher early Tuesday.
Best Stocks To Buy And Watch: Chipotle, Dynatrace, Meta, MongoDB, Nvidia
IBD Leaderboard watchlist stock Chipotle ended a four-day losing streak Monday, still below a flat base’s 2,139.88 buy point, according to IBD MarketSmith pattern recognition. An early entry at 2,092.51 was also available due to a trendline. Chipotle was a recent IBD Stock Of The Day. CMG stock rose 0.3% early Tuesday.
Software maker Dynatrace has formed a three-weeks-tight chart pattern, representing a brief consolidation in which institutional investors pause their buying. Shares are within striking distance of their latest entry at 52.99. DT stock tacked on 0.4% Tuesday morning.
Facebook parent Meta Platforms has been tightly consolidating for the last three weeks, putting a new entry at 298.12. With the stock so far extended from its previous base, this buy point should be used as an add-on entry. Meta shares added 0.3% premarket Tuesday.
MongoDB traded tightly after its recent earnings-fueled jump, which offered a new entry. Shares are just below the three-weeks-tight formation that showed a buy point at 398.89 after recent declines. Meanwhile, aggressive investors could have used a trendline entry around 386. MDB stock moved up 0.3% early Tuesday.
Following its May 25 earnings-fueled gap-up, Nvidia shares have been trending consistently higher. Amid a pullback since June 20, the stock is offering another opportunity to buy shares. It formed a trendline entry at 418 after the stock found support at its 21-day exponential moving average. Nvidia is an IBD Leaderboard stock. Nvidia shares gained 0.7% Tuesday morning.
Best Stocks To Buy And Watch In Stock Market Rally
These are four best stocks to buy and watch in today’s stock market, including a Dow Jones leader.
|Company Name||Symbol||Correct Buy Point||Type Of Buy Point|
|ASML||(ASML)||683.18||Cup with handle|
|Roku||(ROKU)||75.45||Cup with handle|
Source: IBD Data As Of July 10, 2023
IBD Leaderboard stock Tesla declined for a third straight session Monday, down 1.8%. Still, Tesla shares remain sharply out of buy range beyond a double bottom’s 207.79 buy point and just off their 2023 highs.
TSLA stock looked to rebound from Monday’s losses, climbing 0.4% Tuesday.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple stock remains just off last week’s record high at 194.48, falling 1.1% Monday. AAPL stock, down in four of the last five trading sessions, continues to hold sharply above a 157.38 buy point. Early Tuesday, shares gained 0.4% in morning action.
Microsoft shares dropped 1.6% Monday, falling sharply for a second straight sessions. They are pulling back to their 50-day support level. A bounce in heavy volume would result in a new buy area. And on Tuesday morning, Microsoft shares were slightly higher.
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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