Dow Jones futures, along with S&P 500 and Nasdaq 100 futures, were lower Tuesday on a hotter-than-expected inflation report. Earnings season kicked off with strong reports from Goldman Sachs and JPMorgan. Tesla stock again moved up in premarket trade.
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Among the Dow Jones leaders, Apple (AAPL) moved up 0.3% premarket Tuesday, while Microsoft (MSFT) rallied 0.4% in today’s stock market. McDonald’s (MCD) was flat ahead of the open and is just below a new buy point.
Goldman Sachs (GS) and JPMorgan (JPM) reported earnings before the market open Tuesday.
Tesla (TSLA) looked to add to Monday’s 4.35% gain, tacking on about 1% in premarket trade before cutting gains.
Among the top stocks to buy and watch, PayPal (PYPL), Roku (ROKU), Shopify (SHOP) and Square (SQ) are in or near new buy zones.
Microsoft and Shopify are IBD Leaderboard stocks. Roku is an IBD SwingTrader stock. PayPal and Square were featured in this week’s Stocks Near A Buy Zone column.
Dow Jones Futures Today: Inflation Fears
Ahead of the stock market open Tuesday, Dow Jones futures fell 0.2% vs. fair value, while S&P 500 futures lost 0.3%. Nasdaq 100 futures dropped 0.3% 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.
Early Tuesday, the Labor Department reported the consumer price index increased 5.4% from a year ago, the largest jump in nearly 13 years. Economists surveyed by Dow Jones had been expecting a 5% gain. The CPI measures the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care.
Stock Market Rally
The Nasdaq, S&P 500 hit record highs Monday, and the Dow Jones industrials are trading just below the all-time high set in early May.
Monday’s Big Picture column commented, “With the stock market still in a confirmed uptrend, it makes sense to look for stocks to buy. But if you’re happy with your current exposure, it also makes sense to evaluate your current holdings. If you’ve got some nice winners that continue to hold above key support levels, give them room to work. But consider trimming a winning position if a stock breaks support at the 21-day exponential moving average.”
For more stock market commentary, check out IBD’s The Big Picture.
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Dow Jones Stocks To Buy And Watch: McDonald’s
Dow Jones restaurant giant McDonald’s is trading below a 238.28 buy point in a flat base, according to IBD MarketSmith chart analysis, following Friday’s 1.2% advance. Shares were flat early Tuesday.
McDonald’s was featured in Friday’s IBD Industry Themes column, along with Chipotle Mexican Grill (CMG). Chipotle stock is in a new buy range.
Dow Jones Earnings: Goldman Sachs, JPMorgan
Investment banks Goldman Sachs and JPMorgan reported earnings ahead of the stock market open Tuesday.
Goldman Sachs earned $15.02 per share on revenue of $15.39 billion, easily beating analyst targets. GS stock reversed from initial losses to rally 1% in early morning trade Tuesday. The stock closed up 2.7% Monday, just 3% off a new 52-week high.
JPMorgan reported strong Q2 results with EPS of $3.78 on revenue of $30.5 billion. Despite the earnings beat, shares slipped 1% premarket Tuesday. On Monday, the stock failed to regain its key 50-day line Monday and is forming a flat base with a 167.54 buy point.
Stocks To Buy And Watch: PayPal, Roku, Shopify, Square
IBD Leaderboard stock PayPal is in the 5% buy zone past a cup with handle’s 296.11 buy point following last week’s breakout. The 5% buy area goes up to 310.92. Shares rallied 0.3% premarket Tuesday and are squarely in buy range.
On June 17, the top payments processor broke out above a 277.96 entry in a cup base and is comfortably above that level. Leaderboard noted the stock’s rising relative strength line is a positive attribute even though it remains off its 2021 high.
According to the IBD Stock Checkup, PayPal 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.
Square continues to build the right side of a cup base that offers a 278.23 buy point. Meanwhile, a potential handle is close to forming, but requires one more day to complete. A handle would offer a new buy point at 254.88. The stock gained 0.5% premarket Tuesday.
IBD 50 stock Roku added a handle to a cup base, moving the buy point from 486.82 to 463.09. Shares climbed 0.5% premarket Tuesday, trading about 7% away from the new entry.
Roku is an IBD SwingTrader stock.
Shopify is still below a 1,552.33 buy point in a cup with handle, according to IBD MarketSmith chart analysis. Shares inched higher premarket Tuesday following Monday’s slight fall. Shopify is about 5% away from the buy point after last week’s brief breakout attempt.
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Tesla Stock
Tesla stock rallied 0.3% premarket Tuesday, on pace to add to Monday’s 4.35% gain and extend a win streak to four sessions. The electric-vehicle giant continues to rebound from key support at its key 50- and 200-day moving averages. A strong show of support at these levels is 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 moved up 0.3% premarket Tuesday, on pace to take back almost all of Monday’s 0.4% loss. Apple stock is now extended past 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 rose 0.4% premarket Tuesday and are extended. The 5% buy zone 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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