Stock futures knocked around in mixed trade Monday, as rising oil prices boosted energy stocks, and as Bitcoin rallied following comments from Elon Musk. Adobe and Chipotle Mexican Grill were early leaders. China-based names topped the IBD 50 list. While Apple and Intel duked it out for the top slot on the Dow Jones today.
Dow Jones futures lagged a fraction below fair value, while S&P 500 futures defended very tight early gains.
Also on the Nasdaq, Adobe (ADBE) gained 0.7%. The IBD Leaderboard stock received a price hike, to 630, from 560, from Jefferies. Adobe reports its second-quarter results on Thursday. Adobe ended Friday less than 3% below a 525.54 buy point in a seven-week flat base.
Chipotle Mexican Grill (CMG) gained 1.4%, enough to top the S&P 500. Raymond James upgraded the stock to strong outperform, while holding the stock’s price target steady at 1,800 — about 32% above Friday’s closing price.
Energy stocks boosted the S&P 500, rising as oil prices moved to new multi-year highs. Oil-related names posted five of the 10 top early gains on the S&P 500.
Medical device maker ResMed (RMD) gained more than 1%. The stock ended Friday less than 3% below a 224.53 buy point in an almost- five-month base pattern.
Corsair Gaming (CRSR) rallied more than 14%, possibly on meme stock trading. Blank check new issue NextGen Acquisition (NGCA) vaulted more than 5% higher. Chip equipment maker InTest (INTT) swung 12% higher in premarket action.
A busy week of housing, pricing and manufacturing data gets underway Tuesday, as does the two-day Federal Open Market Committee meeting. The Fed meeting wraps up with a rate policy announcement and press conference on Wednesday afternoon.
Gear up for the week’s market action by reading IBD’s Investing Action Plan.
Intel nosed up 0.5%, taking the premarket lead on the Dow Jones today. A four-week advance lifted Intel stock off a test of support at its 200-day moving average. But the stock remains deep in a two-month consolidation.
Caterpillar (CAT) led a crash among infrastructure-related plays last week, as likelihood for a joint White House/GOP spending plan moved further from reality. Vulcan Materials (VMC) also fell hard, while Martin Marietta (MLM) managed a modest gain for the week.
In any case, Caterpillar‘s move caused some chart damage and triggered multiple sell signals. Caterpillar stock has several weeks of work to go before it could offer a valid buy point. CAT shares traded down 0.3% early Monday.
Bitcoin Rebounds On Musk Comment
Bitcoin bounced 9% early Monday to trade above $39,300, according to Fintech Zoom. The cryptocurrency had dipped below $32,000 last Tuesday, briefly narrowing its gain for the year to less than 10%.
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Bitcoin price jumped Sunday after Elon Musk tweeted that Tesla only sold about 10% of its Bitcoin, presumably near the end of the first quarter. He said “Tesla will resume allowing Bitcoin transactions” when the cryptocurrency’s green energy use improves.
Bitcoin touched a record high above $64,800 on April 14. It is up almost 7% since the start of June, with a year-to-date gain of just over 35%.
Vital Signs: Bond Yields Flat
Bonds yields held somewhat steady, after a four-week slide left the 10-year Treasury yield at 1.46% on Friday, according to CBOE data.
Yields are down about 7.5% so far for June, making it the worst month for yields since a 17.5% dive in July 2020. The 10-year yield hit a 13-month high above 1.76% on March 30.
Markets are keeping a close eye on Treasury yields as inflation indicators edge higher, and as the Federal Open Market Committee prepares to head into its meeting on Tuesday.
Vital Signs: Oil Prices
In oil prices, West Texas Intermediate futures rose 0.7%, to trade above $71 a barrel. That is their highest level since peaking at $76.90 in October 2018. West Texas Intermediate is the benchmark oil contract for the U.S. market.
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Oil prices have gained as demand recovers entering the summer driving season, and after the International Energy Agency on Friday projected oil would reach its prepandemic levels by the end of 2022 — sooner than previously expected.
IBD 50 Stocks: Up Fintech, 360 Digitech, Generac
China names staked out leads among IBD 50 stocks. Up Fintech Holding (TIGR) remained in rally mode, up 3% in premarket trade. The mobile brokerage platform has advanced more than 25% so far in June, and is scaling the right side of a very deep, four-month consolidation.
Fintech peer 360 Digitech (QFIN) rose 2.7%. The financial marketing platform developer broke out of an 11-week cup base on June 4. Shares are extended beyond the buy range, with a year-to-date gain of 242%.
Generac (GNRC) edged 0.5% closer to its buy point early Monday. The solar component and emergency generator manufacturer closed Friday about 4% below a 364.10 buy point in a late-stage base pattern.
Not quite a third of IBD 50 stocks ended last week queued up in various base patterns. Another 15% or so remained in buy ranges.
Dow Jones Today: Financials Eye The Fed
The Dow Jones today appeared set for a quiet start, with most Dow issues little changed.
The Fed’s announcement this week could have broad influence on the market, but financials most sensitive to rate policy will be in particular focus. Goldman Sachs (GS) starts the week in a buy range. The stock hovered for three weeks after clearing a seven-week cup base in early May. That flat trade led to a three-weeks tight chart pattern with a 377.08 buy point.
The stock snapped past that buy point at the start of June. Then, just as quickly, reversed to just above the entry. Goldman’s technicals and fundamentals are all in order. The stock is up a modest 6% from its early May breakout. It is sitting patiently at its 21-day exponential moving average, waiting on a signal whether to move up or down.
JPMorgan (JPM) has had a harder time, after falling back quickly from its early May breakout to test support at its 21-day line. Shares managed a 3.5% gain above the flat base buy point. A five-day decline last week ruptured support at the 21-day line, but stopped less than 2% below the buy point and short of a test of 10-week support.
Visa (V) on Friday added a sixth day to its modest rally, shaping a six-week flat base with a 237.60 buy point. Shares at the closing bell were a bit more than 1% below that entry.
Visa‘s technicals and fundamentals are weak: a 45 Composite Rating and a relative strength rating of 42. The stock has gained a little more than 7% this year through Friday, vs. a 43.4% advance for Goldman Sachs, and a 26.1% increase for JPMorgan.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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