Dow Jones Futures Rally As Tesla Falls From Record High; Facebook Climbs On Earnings; AMD, Microsoft On Deck

Dow Jones futures rallied 100 points early Tuesday, as Tesla (TSLA) stock fell from record highs. Facebook (FB) climbed on earnings, while AMD (AMD) and Microsoft (MSFT) earnings are due after the close.


Among the Dow Jones leaders, Apple (AAPL) rose 0.3% premarket Tuesday in today’s stock market, while American Express (AXP), Goldman Sachs (GS) and JPMorgan Chase (JPM) eyed new buy points.

Tesla dropped 1% premarket Tuesday, falling from Monday’s record highs.

Among companies reporting earnings, Facebook beat expectations late Monday, while Advanced Micro Devices and Microsoft will report after the close Tuesday.

Among the top stocks to buy and watch, Cleveland-Cliffs (CLF), Nvidia (NVDA) and Olaplex (OLPX) are in or near new buy zones.

Microsoft, Olaplex and Tesla are IBD Leaderboard stocks. Nvidia was featured in this week’s Stocks Near A Buy Zone story, while Cleveland-Cliffs was Friday’s IBD Stock Of The Day.

Dow Jones Futures Today

Ahead of the stock market open Tuesday, Dow Jones futures rose 0.3% vs. fair value, while S&P 500 futures rallied 0.4%. Nasdaq 100 futures gained 0.6% 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.

Among exchange traded funds, Innovator IBD 50 (FFTY) hadn’t started trading yet premarket Tuesday. Nasdaq 100 tracker Invesco QQQ Trust (QQQ) gained 0.6%. And the SPDR S&P 500 ETF (SPY) ascended 0.4%.

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Stock Market Rally

The stock market rally strengthened Monday, as the Dow 30 and S&P 500 notched all-time highs, while the Nasdaq recovered from Friday’s moderate loss.

For daily stock market commentary, be sure to check out IBD’s The Big Picture.

On Monday, The Big Picture commented, “Monday’s gains proved to be a bullish response to Friday’s losses, which marked the first distribution day since the Oct. 14 market follow-through.”

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Dow Jones Stocks To Buy And Watch: Amex, Goldman, JPMorgan

American Express ended Monday in the 5% buy area above a 178.90 buy point in a cup with handle, according to IBD MarketSmith chart analysis. Shares rose 0.5% premarket Tuesday.

Goldman Sachs is within striking distance of a 420.86 buy point in a flat base following Monday’s 0.1% rise. Shares moved up 0.5% premarket Tuesday. Meanwhile, JPMorgan remains at the top of the 5% buy zone past a 163.93 entry in a cup with handle after a bounce off the 50-day moving average. The 5% buy area tops out at 172.13. JPM stock was slightly higher premarket Tuesday.

American Express and Goldman Sachs both have strong relative strength lines. A strong relative strength line at the start of a new uptrend is indicative of a potential market leader.

Dow Jones Earnings: Microsoft

Software giant Microsoft climbed 0.6% premarket Tuesday ahead of the company’s earnings results. Shares remain in buy range above its latest buy point. The flat base had a 305.94 buy point, and the 5% buy zone tops out at 321.24.

The Dow component will report earnings late Tuesday. Analysts expect the company to earn $2.08 per share on revenue of about $44 billion.

Facebook Earnings

Late Monday, social media giant Facebook reported its quarterly earnings results. The company earned $3.22 per share on sales of $29 billion, topping earnings forecasts but missing top-line estimates. Facebook shares gained more than 1% premarket Tuesday.

On Friday, Facebook shares tumbled more than 5% in the wake of disappointing revenue and guidance from rival Snap (SNAP). Facebook stock is testing its long-term 200-day moving average. Shares reversed from early losses to rally 1.3% Monday, ending the session just above its long-term 200-day line.

Stocks To Buy And Watch: AMD, Cleveland-Cliffs, Nvidia, Olaplex

Advanced Micro Devices broke out past a 114.59 buy point out of a double-bottom base last week — according to IBD MarketSmith chart analysis — and is now extended following Monday’s 2.1% rise. Shares rallied 1.4% premarket Tuesday. Earnings are due out Tuesday after the close. The chip leader is expected to earn 66 cents per share on sales of $4.1 billion.

According to IBD Stock Checkup, AMD boasts a perfect 99 IBD Composite Rating. The IBD Composite Rating identifies stocks with a blend of strong fundamental and technical characteristics.

Friday’s IBD Stock Of The Day, Cleveland-Cliffs, is rapidly nearing a 26.61 buy point in a cup base amid Monday’s 6.6% climb. CLF shares were slightly higher premarket Tuesday. Meanwhile, the stock triggered a new entry during Friday’s sharp move back above its 50-day moving average. Per Stock Of The Day analysis, “The high-volume move past its 50-day line, along with a break above the downsloping trend line from CLF stock’s Aug. 13 intraday high of 26.51, offered investors an early entry point.”

IBD SwingTrader stock Nvidia is trying to break out past a cup-base’s 230.53 buy point. NVDA shares rallied nearly 2% Monday, closing just above the buy point. The stock added almost 3% premarket Tuesday. Positively, the stock’s relative strength line is near new highs, reaffirming the stock’s leadership status.

IBD Leaderboard stock Olaplex closed Monday in the 5% buy area past an IPO base entry at 27.84. Shares reversed nearly 3% lower Monday, but remain above the entry. Olaplex was unchanged premarket Tuesday. The buy area tops out at 29.23. Per Leaderboard analysis, it also cleared an aggressive trendline entry near 27.

Join IBD experts as they analyze leading stocks in the new stock market uptrend on IBD Live

Donald Trump SPAC

Digital World Acquisition (DWAC) — a special-purpose acquisition company, or SPAC, merging with Trump Media & Technology Group — dived 11% Monday, reversing lower and giving back a part of Friday’s 107% surge.

DWAC stock extended losses, falling about 1% in premarket trade. Last week, former President Trump announced plans to launch a social media company named Truth Social. There will also be a subscription-based video-on-demand service to be called TMTG+.

A SPAC, also known as a blank-check company, is an alternative to a traditional initial public offering. These blank-check companies have no assets beyond cash. They trade on stock exchanges and then merge with private companies, taking those companies public.

Tesla Stock

Tesla stock slipped about 1% premarket Tuesday, falling from all-time highs. On Monday, Tesla shares surged 12.7%, hitting a $1 trillion valuation after car rental giant Hertz ordered 100,000 Tesla vehicles for its fleet. Meanwhile, Morgan Stanley boosted its price target on Tesla from 900 to 1,200, citing higher volume expectations after the company’s third-quarter report.

On Sunday, Tesla Chief Executive Elon Musk tweeted that the company’s full self-driving software, FSD Beta 10.3, was “seeing some issues,” so the company was rolling back to Beta 10.2. But then early Monday, he tweeted that FSD Beta 10.3.1 was “rolling out now.”

The stock hit new highs Monday, trading as high as 1,045.02. TSLA shares are sharply above a 764.55 buy point in a cup with handle, as well as earlier entries at 700.10 and 730. An alternative entry at 900.50 also could be identified.

Dow Jones Leaders: Apple

Among the top Dow Jones stocks, Apple rose 0.3% premarket Tuesday, on pace to snap a two-day slide. Shares are holding just above their 50-day line.

A new cup base is forming that has a 157.36 buy point, according to IBD MarketSmith chart analysis. Be on the lookout for a potential handle to offer a more risk-optimal entry.

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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