Dow Jones rises 765 points to start another stock market rally attempt, what to do now

Dow Jones futures were down ahead of Tuesday’s open. Another attempt at a stock market rally began on Monday, as the Dow Jones Industrial Average jumped 765 points.


stock market today

On Monday, the Dow Jones Industrial Average jumped 2.7%, leading the stock market higher. The S&P 500 climbed 2.6% and the tech-heavy Nasdaq composite rebounded 2.3%. And the small-cap Russell 2000 rose 2.65%.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) rose 2.35% and the SPDR S&P 500 (SPY) rose 2.6%.

This week’s top earnings reports come from Sharpness marks (AYI), ConAgra Brands (GAC), Constellation Brands (STZ) and McCormick (MKC).

General Motors (GM) reported third-quarter auto sales on Monday, beating expectations for strong consumer demand and improved vehicle availability. GM shares rose 2.4% on Monday but are still more than 50% off their 52-week high.

VE Giant You’re here (TSLA) fell 8.6% after missing vehicle delivery estimates. Among Dow Jones stocks, Apple (AAPL) rose 3.1%, while Microsoft (MSFT) climbed 3.4% in the current stock market.

In the ongoing weakness of stock markets, Murphy UNITED STATES (MUSA), Neurocrine Biosciences (NBIX), Vertex Pharmaceuticals (VRTX) and World wrestling entertainment (WWE) – as well as Dow Jones stocks UnitedHealth (UNH) – are among the most important stocks to watch. Keep in mind that the ongoing stock market correction is a time for investors to sit on the sidelines and build watch lists.

Vertex is a recent addition to the IBD ranking. Murphy USA was featured in this week’s Stock Near A Buy Zone column, along with three other stock ideas.

Dow Jones Futures Today: Treasury Yields, Oil Prices

Before Tuesday’s opening bell, Dow Jones futures fell 0.1% below fair value, while S&P 500 futures lost less than 0.1%. Nasdaq 100 futures are up less than 0.1% from fair value. 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.

The 10-year Treasury yield fell significantly to 3.65% on Monday. Last week, the 10-year Treasury yield briefly topped 4%, the lowest it had been in over a decade.

Meanwhile, U.S. oil prices jumped more than 4% on Tuesday, with West Texas Intermediate futures trading above $83 a barrel. Last week they fell to their lowest level of the year. On Wednesday, OPEC+ will meet to consider a production cut to help support falling oil prices.

What to do in the new stock market rally attempt

Despite Monday’s strong gains, IBD’s market trend remains in a “correcting market”, with the strong selling of the past few weeks. This means investors need to stay in cash.

However, Monday’s gains kicked off another attempt at a stock market rally, which is your Day 1. Action on Days 2 and 3 is irrelevant until the index breaks above its latest low. If this low is undercut, the rally test is over and the market must try again.

Then, investors must wait for a trailing day, which occurs on day 4 or later. From Thursday (day 4), you are looking for a strong rise in the Nasdaq or S&P 500 in higher volume than the previous session. It’s a follow-up day. This gives investors the green light to start buying top-tier stocks overtaking the correct buy points. It should synchronize your portfolio and mindset with the stock market action by gradually committing capital to leading stocks.

Now, ahead of a potential tracking day, is a great time to build a strong watchlist of top performing stocks. Many long-term leaders tend to break out at or near the trailing, market bottom signal. Missing that first opportunity can be a costly mistake.

Friday’s The Big Picture column commented: “Market averages have now fallen for a third consecutive quarter for the first time since 2009. The crumb of comfort for investors is the fact that IBD research finds that markets bears form on three or four waves of intense selling. It seems to be the third game.”

Five Dow Jones stocks to watch now

Dow Jones stocks to watch: UnitedHealth

Dow Jones UnitedHealth stock rose 2.1% on Monday, again finding support around the long-term 200-day line. The stock is building a flat base that has a buy point of 553.23, according to IBD MarketSmith’s chart analysis. Stocks are around 7% from their last buy point and facing a resistance test at the 50-day line.

UNH stock is posting a solid 95 out of a perfect IBD composite rating of 99, according to the IBD Stocks Balance Sheet. Investors can use the IBD Composite Rating to easily assess the quality of a stock’s fundamental and technical metrics.

4 growth stocks to watch in the currentrent Stock market correction

Top stocks to watch: Murphy USA, Neurocrine, Vertex, WWE

Murphy USA, the leader in gas stations and mini-markets, is building a flat base with a buy point of 303.19. Stocks rebounded 3.1% on Monday and are approaching potential resistance at their 50-day line. A decisive recovery from this level would be bullish for the stock’s basis building outlook.

Wednesday’s IBD 50 Stocks To Watch pick, Neurocrine Biosciences, is building a flat base that has a buy point of 109.36, according to IBD MarketSmith’s chart analysis. Stocks are just 2% off the buy point after Monday’s 0.5% gain. The RS line hit a new high on Friday, a bullish signal.

The IBD Leaderboard Vertex Pharmaceuticals stock definitely regained its 50-day line last week. Stocks are building a flat base with a buy point of 306.05 and an early entry at 296.24. The stock topped early entry on Monday’s nearly 3% gain. While market weakness may keep you on the sidelines, the stock’s resilience makes it a great idea to watch. Its RS line is at new highs, a potential sign of a big stock market outperformance.

World Wrestling Entertainment continues to build a flat base that has an entry of 75.33. The stock is back above its 50-day line and just 4% from the buy point. The RS range continues to reach new heights.

Join IBD experts as they analyze the top stocks of the current market correction on IBD Live

Tesla Stock

Tesla stock plunged 8.6% on Monday, closing at its lowest level since July 18, after the company missed estimates on vehicle deliveries over the weekend.

The electric vehicle giant delivered 343,830 electric vehicles in the third quarter, up 42% from a year earlier and surpassing the first quarter record of 310,048. It was also 35% higher than the 254,695 in Q2 . The Shanghai factory faced a long shutdown and slow recovery in the second quarter due to Covid lockdowns.

But analysts had expected Tesla deliveries of 350,000 to 370,000, with the consensus just above 360,000. Tesla cited an increase in the number of vehicles in transit. But that may reflect weaker Chinese demand, spurring an earlier-than-usual export surge from Shanghai.

Shares are more than 40% off their 52-week high.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares soared 3.1% on Monday, ending a three-day losing streak. Still, stocks are more than 20% off their 52-week high and below their 50- and 200-day lines.

Microsoft rose 3.3% on Monday, rebounding from Friday’s 52-week low price. The software giant remains more than 30% off its 52-week high.

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


Top growth stocks to buy and watch

Learn to Time the Market with IBD’s ETF Market Strategy

Find the best long-term investments with IBD’s long-term leaders

MarketSmith: research, charts, data and coaching in one place

How to Research Growth Stocks: Why This IBD Tool Simplifies Finding the Best Stocks

Add Comment