Dow Jones futures will open Sunday night, along with S&P 500 and Nasdaq futures. The stock market rally has shown resilience over the past week, paring modest weekly losses even as Treasury yields soared. But Friday’s rebound largely failed, as the Nasdaq faces resistance.
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Nvidia stock, Visa (V), Chipotle Mexican Grill (GCM), Salesforce.com (CRM), Tempur Sealy (TPX), Livent (LTHM), Arista Networks (A NET), SLB (SLB), Flowserve (FSL) and Marriott International (MAR).
Visa and Marriott stocks are in traditional buy zones, while Chipotle and FLS stocks are nearby. The SLB stock is exploitable from an early entry while Nvidia (NVDA), CRM stock, Tempur Sealy, Arista Networks and Livent are close.
Nvidia and software companies Salesforce and Dynatrace are riding the wave of AI, along with many other tech stocks.
Nvidia is on the IBD rating, while CMG stock is on the rating watch list. DT stock is on SwingTrader. Both LTHM stock and Salesforce.com are on the IBD 50 list. Salesforce was the IBD stock of the day on Friday.
The video embedded in the article discussed the weekly market rally action and analyzed the shares of Salesforce, Tempur Sealy and SLB.
Dow Jones Futures Today
Dow Jones futures open Sunday at 6 p.m. ET, along with S&P 500 and Nasdaq 100 futures.
Remember that overnight action on futures contracts on Dow Jones and elsewhere does not necessarily translate into actual trading in the next regular trading session.
Join the experts at IBD as they analyze actionable stocks in the stock market rally on IBD Live
Stock market rally
The stock market rally retreated in a holiday-shortened week.
The Dow Jones Industrial Average fell 2% in stock trading last week, slipping below its 21-day line and approaching its 50-day line. The S&P 500 index fell 1.2% just below its 10-day line. The Nasdaq composite slipped 0.9%, holding 10 days. The small-cap Russell 2000 fell 1.4%, but Friday’s 1.1% rebound took it back above the 21-day mark.
The Invesco S&P 500 Equal Weight (RSP) ETF was down just 0.75% for the week. The First Trust Nasdaq 100 Equal Weighted Index ETF (QQEW) fell 1.3%.
The 10-year Treasury yield jumped 23 basis points to 4.05%, matching the 2023 high of 4.09% intraday. The two-year Treasury yield, more closely tied to Fed policy, rose 5 basis points to 4.93%, but fell from Thursday’s 16-year high of 5.12%.
U.S. crude oil futures jumped 4.6% to $73.86 a barrel during the week. Copper futures rose 0.7%, thanks to a 1.3% gain on Friday.
The US dollar initially rallied along with Treasury yields, putting pressure on equities and especially commodities. But the greenback reversed lower for the week.
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Among growth ETFs, the Innovator IBD 50 ETF (FFTY) fell 2.7% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) lost 1.75%. The iShares Expanded Tech-Software Sector ETF (IGV) fell 1.8%, with CRM stock a major component. ETF VanEck Vectors Semiconductor (SMH) fell 2.1%, led by NVDA stock.
Reflecting more speculative historical stocks, ARK Innovation ETF (ARKK) fell 0.9% last week and ARK Genomics ETF (ARKG) fell 2.8%.
The SPDR S&P Metals & Mining ETF (XME) fell 0.6%% last week, but hit lows. The Global X US Infrastructure Development ETF (PAVE) fell 1.6%. The US Global Jets ETF (JETS) was up 1.2% and 6% the previous week. SPDR S&P Homebuilders ETF (XHB) fell 2.9%. ETF Energy Select SPDR (XLE) fell 0.5%, with SLB stock holding a large position. The SPDR healthcare sector fund (XLV) fell 2.8%. The Industrial Select Sector SPDR Fund (XLI) was down 1%.
The Financial Select SPDR ETF (XLF) fell 0.4%, hitting resistance at the 200-day line. The SPDR S&P Regional Banking ETF (KRE) rose 1.6%.
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Stocks to Watch
Nvidia stock edged up 0.5% to 425.03 over the week. The AI leader has a tight four-week pattern with a buy point of 439.90, but investors could use 431.77 as an early entry. Longer recoil or side action would be ideal, but stock NVDA may not offer this.
Visa stock is holding just above a fixed base buy point of 235.57 and is just 3.2% above its 50-day line. Can Visa and its fellow payments giant MasterCard (MA) finally takes another real step? A robust US consumer and overseas travel are tailwinds.
CMG stock attempted to break above a fixed base buy point of 2,139.88, but never closed above it, according to MarketSmith analysis. Shares fell 2.9% to 2,077.46 for the week, returning to the 21-day, 10-week line. A bullish move from these levels or a traditional breakout are possible entries.
CRM stock is trading closely at its 21-day and 10-week lines, in a flat basis with a buy point of 225. A move above Wednesday’s high of 214.62 would offer early entry.
TPX stock rose 0.9% to 40.43, including Friday’s nearly 3% gain in above-average volume. The mattress giant is working on the right side of a five-month consolidation with a buy point of 44.28. It’s right at the resistance around 41.50-41.62. Compensation that would provide early entry into Tempur Sealy stock.
LTHM stock rose 1.7% to 27.40 on Friday, just below an entry of 27.75. Investors might view 27.75 as a handle high to a lower base. Other lithium games bounce after You’re here (TSLA) and several other electric vehicle makers reported strong second-quarter deliveries in recent days.
ANET stock is starting to tighten again, finding support at the 21-day line. It is close to a breakout of the trendline, with 164.20 as another possible entry. The networking giant has a new base with a buy point of 178.36. Note that Arista stock has a few weeks of high volume selling in its new consolidation.
SLB stock jumped 8.6% to 53.35 on Friday in the biggest volume of the year, topping its 200-day line and breaking a trendline dating back to January. Investors could still buy the oil services giant, formerly known as Schlumberger, although it is somewhat extended from the 200 days. SLB revenue is due July 21.
Flowserve stock rose 1.9% to 36.96 on Friday, rebounding from the 21-day line. The FLS stock has a buy point of 37.56 cups with handle. Flowserve has struggled since 2014. But earnings are rebounding, with strong growth seen through 2024. Industrials are currently the market leaders, with Flowserve’s end markets doing well.
Marriott stock rose 1.1% to 185.66 for the week. Friday’s 2% gain in slightly above-average volume took MAR stock back above a buy point of 183.27 and not far off the April 2022 high.
Market rally analysis
The market rally has moved sideways over the past three weeks, which has been constructive, allowing stocks to return to key support or forge handles and bases.
Few stocks have issued buy signals and maintained those moves over the past week. But a slew of high-profile actions from various groups are rolling in, including Nvidia, Salesforce, Flowserve, and many more. Chips, software and megacaps look strong, but housing, industrials, travel and even some energetic games. The same is true for electric vehicles and automakers in general, although few are in a position.
The bulls want to run, which is a good thing, but hit resistance The Nasdaq is 5.4% above its 50-day line with the Nasdaq 100 up 6%. These are not extensive, but are not far from it. Ideally, the Nasdaq would move sideways or slightly sideways
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What to do now
Investors should pay close attention and build their watchlists. You can look to add exposure slightly, but do so carefully. A number of stocks posted early entries over the past week or so to retreat amid the limited market. Many may work well, but you can’t assume that.
You may still want to take quick partial profits, especially if the Nasdaq hits extreme levels again.
Keep in mind earnings season begins next week, with Delta Air Lines (DAL), Aehr test systems (AEHR) and JPMorgan Chase (JPM) at the head of several banks.
Read The Big Picture every day to stay in tune with market direction and top stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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