Dow Jones futures dropped 125 points late Monday, as the stock market weakness continued after the Dow 30 found resistance at a key benchmark. Tesla stock rallied ahead of China sales data Tuesday.
On Monday, the Dow Jones Industrial Average slid 0.7%. The S&P 500 also declined 0.7%, while the Nasdaq dropped 0.6% to end the session at day lows.
Among the Dow Jones leaders, Apple (AAPL) lost just 0.1%, while Microsoft (MSFT) moved down 0.2% in today’s stock market. American Express (AXP), Merck (MRK) and Salesforce.com (CRM) eyed new buy points in the current stock market correction.
Tesla (TSLA) rallied nearly 1% Monday, moving further above the stock’s latest buy point. The EV giant’s China sales for September are expected to be released early Tuesday.
Among the top stocks to watch, Advanced Micro Devices (AMD), Netflix (NFLX) and Palo Alto Networks (PANW) are in or near new buy zones, although the market, for now, remains in a correction.
Advanced Micro Devices, Microsoft and Tesla are IBD Leaderboard stocks. Palo Alto Networks is an IBD SwingTrader stock. Microsoft and Salesforce featured in this week’s Stocks Near A Buy Zone column.
Dow Jones Futures Today
After the stock market close Monday, Dow Jones futures dropped 0.4% vs. fair value, while S&P 500 futures moved down 0.45%. Nasdaq 100 futures declined 0.5% 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.
U.S. Stock Market Today Overview
Last Update: 4:38 PM ET 10/11/2021
Among exchange traded funds, Innovator IBD 50 (FFTY) moved down 0.8% Monday. Nasdaq 100 tracker Invesco QQQ Trust (QQQ) lost 0.8%. And the SPDR S&P 500 ETF (SPY) descended 0.7%.
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Stock Market Rally Attempt
The Nasdaq and S&P 500 continue to hold above last week’s correction lows, but both extended Friday’s weakness with moderate losses Monday. Meanwhile, the Dow Jones Industrial Average again found resistance at its 50-day moving average.
On Friday, The Big Picture commented, “With major stock indexes still below their 50-day lines, the stock market is still vulnerable to more downside, but a follow-through day could happen at any time. And stock market bulls are encouraged by the number of growth stocks that continue to show strength and support after earlier breakouts.”
Dow Jones leaders American Express, Merck and Salesforce are blue chip stocks to watch in today’s stock market action.
IBD SwingTrader stock American Express is approaching a 179.77 buy point in a cup with handle, according to IBD MarketSmith chart analysis. Shares declined 1% Monday and are about 3% away from the new buy point.
Merck dropped almost 1% Monday, adding to Friday’s 1.6% drop. Today, the company and partner Ridgeback Biotherapeutics asked the FDA to approve their experimental Covid pill. On Oct. 1, Merck stock broke out past a 79.33 buy point in a flat base after the company said the drug reduced the risk of hospitalization by half in a final-phase study. Shares remain in buy range, but breakout gains are fading.
Dow Jones software leader Salesforce is trying to retake a 275.32 buy point in a cup with handle following a Sept. 23 breakout move. Shares rallied 0.5% Monday, closing just below the entry.
American Express and Salesforce both have a strong relative strength line. Strong relative strength lines during weak general market conditions are indicative of potential market leaders.
Stocks To Watch: AMD, Netflix, Palo Alto
IBD Leaderboard stock Advanced Micro Devices fell further below its 50-day line, dropping 0.4% Monday. Shares are trying to regain that key benchmark, but are finding resistance. AMD exposure was raised after the stock moved above a trend line entry. AMD is also forming a cup-type base.
According to IBD Stock Checkup, AMD stock boasts a perfect 99 IBD Composite Rating. The IBD Composite Rating identifies stocks with a blend of strong fundamental and technical characteristics.
FANG stock leader Netflix lost 0.9% Monday and remains just off new highs. NFLX stock is outside the 5% buy zone past a 593.39 entry point in a consolidation amid the recent global success of its series “Squid Game.”
IBD SwingTrader stock Palo Alto Networks is trying to clear a 496.02 entry in a short consolidation. Shares gained 1.4% Monday, and are just above the new buy trigger. Bullishly, the stock’s relative strength line hit a new high Monday, reaffirming the stock’s leadership status.
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Tesla stock rallied nearly 1% Monday, rebounding from Friday’s 1% decline. TSLA shares are above a 764.55 buy point in a cup with handle.
Ahead of the market open Tuesday, the China Passenger Car Association is expected to release September electric vehicle sales in China. While official September auto insurance registration numbers are not out yet, there are early, anecdotal reports of robust registration for Tesla’s Model Y in China
TSLA shares closed Friday about 12% away from record highs. On Jan. 25, Tesla stock hit a record high of 900.40, after climbing as much as 93% from a 466 buy point in a cup-with-handle pattern.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple moved down 0.1% Monday, adding to Friday’s 0.3% loss. The stock is still below the 50-day line, but above its recent lows.
Software giant Microsoft fell 0.2%, as the stock battles to retake the 50-day line. A new flat base is forming with a 305.94 buy point.
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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