Futures: What to do after today's stock market decline

Dow Jones futures were higher after the stock market fell on Monday ahead of Federal Reserve Chairman Jerome Powell’s speech from Jackson Hole on Friday.


Palo Alto Networks (PANW) and Video scaling (ZM) were key earnings drivers after Monday’s close. Palo Alto Stock jumped more than 7% on better-than-expected results, while Zoom shares fell more than 7% in extended trading after it cut its earnings and sales outlook for the year.

Stock market today

On Monday, the Dow Jones Industrial Average fell 1.9%, while the S&P 500 lost 2.1%. The technology Nasdaq Composite sold off 2.55%. And the small-cap Russell 2000 fell 2.1%.

Overview of the US stock market today

Index Symbol Price Profit/Loss % change
Dow Jones (0JIA) 33065.52 -641.22 -1.90
S&P 500 (0S&P5) 4138.37 -90.11 -2.13
Nasdaq (0NDQC ) 12381.57 -323.65 -2.55
Russell 2000 (IWM) 190.65 -4.00 -2.05
IBD 50 (FFTY) 28.91 -0.17 -0.58
Last updated: 4:28 PM ET on 08/22/2022

Between exchange traded fundsthe Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 2.1%, and the SPDR S&P 500 (A SPY) fell by 1.7%.

EV giant Tesla (TSLA) fell 2.3% on Monday. Between Dow Jones Leaders, An apple (AAPL) and Microsoft (MSFT) slipped by 2.3% and 2.9% respectively in today’s stock market.

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As the stock market continues to pull back, Albemarle (ALB), Arista Networks (NETWORK), Axcelis Technologies (ACLS) and Costco (PRICE) — as well as Dow Jones stocks Coke (KO), Merck (MRK) and McDonald’s (MCD) — are among the best stocks to buy and watch.

It’s Albemarle IBD ranking availability. Arista and Axelis participated this week the Stocks column near a buy zone.

Dow Jones futures today: Treasury yields, oil prices, Powell’s speech

Before Tuesday’s open, Dow Jones futures, along with S&P 500 futures, were up 0.2 percent each at fair value, while Nasdaq 100 futures gained 0.4 percent. Remember this night action in Dow Jones futures and elsewhere does not necessarily become an actual trade in the next regular Stock Exchange session.

The yield on the 10-year Treasury note rose to 3.03 percent on Monday, extending last week’s jump. The yield on 10-year government bonds is above the 3% level for the first time since July 21. Meanwhile, US oil prices rose, with West Texas Intermediate futures trading near $91 a barrel.

Fed chief Powell will deliver a speech on Friday about the central bank’s economic outlook from Jackson Hole, Wyo. The Fed has raised interest rates this year in an effort to reduce inflation and has signaled that more hikes are on the way.

Minutes from the Fed last week appeared to defy market expectations for a low pivot that had already helped spark a six-week stock market rally since the June 14-15 meeting. Place of markets a approximately 56% chance of a 75 basis point rate hike on September 21. A week ago there was a 39% chance.

What to do in the current stock market pullback

The stock market retreat continued on Monday as the major stock indexes sold off sharply, finishing near session lows.

As the market shows more signs of continued weakness, investors should play more defensively with existing positions. This doesn’t mean you should run for the money entirely, but make sure your profits don’t evaporate and be quick to exit losing positions.

Still, the overall trend remains up, so keep an eye out for stocks that are performing best during the current stock market weakness. An easy way to identify stock market leadership is to use the relative strength line. A strong RS line while the stock market is struggling is a strong technical indicator.

The Big Picture column on Monday commented: “Sellers returned from the weekend with a big appetite, sending stock market indexes to a second straight day of sharp losses. After the two-session rout, investors have reason to make some defensive adjustments.”

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Investors can also create watch lists, find companies that are approaching a point of purchaseor develop custom screens on IBD MarketSmith.

Five Dow Jones Stocks to Watch Now

Dow Jones stocks to watch: Coca-Cola, McDonald’s, Merck

Dow Jones soft drink giant Coca Cola is building a flat base that has a buy point at 67.30. A handle entry at 65.14 is also in play. Shares fell below their early entry during Monday’s 1.5% decline.

Shares of McDonald’s are trading back below a 265.56 cup handle entry after a 1.35% drop on Monday.

Merck is building a flat base, a pattern that shows a buy point of 95.82. Shares remain above their 50-day line amid Monday’s 1% decline, according to IBD MarketSmith graph analysis.

MRK shares showing a solid 94 out of a perfect 99 IBD Composite Rating, according to IBD Stock Check. Investors can use the IBD Composite Rating to easily gauge the quality of a stock’s fundamental and technical indicators.

4 Highest Growth Stocks to Watch in the Courserstock market rally

Top stocks to watch: Albemarle, Arista, Axcelis, Costco

IBD ranking stocks and lithium producer Albemarle is in buy range after Monday’s rebought at a large cup handle 273.78 point of purchase. The 5% buy zone rises to 287.47. In previous weeks, the stock had broken through a smaller cup with a buy point on the 250.25 handle.

Arista Networks, one of last week’s IBD 50 Stocks to Watch picks, continues to move up the right side of a double bottom base that offers a 143.67 buy point. With the stock about 11% away from the current entry, look for a handle to offer a more risk-optimal buy point. Arista’s RS line is on the rise and approaching a new high. ANET shares fell 2.2% on Monday.

Retail giant Costco surrendered its cup with 552.81 buy points on the handle on Monday, down 1.6%. Wait for another bullish takeover of the entry before buying shares.

Chip equipment maker Axcelis Technologies continues to create a mug with a handle that offers 79.93 points to buy, according to IBD MarketSmith graph analysis. Shares fell 4.8% on Monday.

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Tesla stock

Tesla shares lost 2.3% on Friday, extending its losing streak to five sessions. The EV giant’s stock is finding strong resistance around its 200-day line.

Tesla shares are about 30% off their 52-week high. Its 3-for-1 stock split is scheduled for Wednesday.

Dow Jones Leaders: Apple, Microsoft

Between Dow Jones StocksApple shares sold off 2.3% on Monday, as shares continue to build the right side of the cup base which has 179.71 buy points. Another interpretation could be a major double bottom extending into January. Either way, the point of purchase is identical. The last three days of losses could be the early part of a potential handle that would suggest a lower entry.

On the upside, the relative strength line of stocks is holding at new highs, indicating major stock market outperformance.

Microsoft fell 2.9% on Friday, extending its losing streak to five sessions and falling further from its 200-day line.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.


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