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Dow Jones Dips, Small Caps Mauled; Apple Rises As Tesla Stalls Amid Lawsuit; AMC Stock Dives

The Dow Jones Industrial Average was the worst-performing major stock index, while small caps were also spanked in a negative session. Apple (AAPL) managed to move higher in a buy zone, with American Express (AXP) another blue chip standout. Tesla (TSLA) stock stalled, while AMC Entertainment (AMC) turned negative as it ceded early gains.

A couple of stocks tried to swim against the tide by staging breakouts. Leaderboard stock DocuSign (DOCU) and IPO stock Monday.com (MNDY) both passed buy points.




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Nasdaq Forced Lower As Bears Maul Small Caps

The Nasdaq composite held up the best, but was down almost 0.1%. Amazon (AMZN) outperformed in the Nasdaq 100, rising almost 5%. Chinese e-commerce play Pinduoduo (PDD) lagged, falling more than 5%.

The S&P 500 also struggled, giving up 0.4%. Leaderboard name Generac (GNRC) was one of the better performers here, rising almost 4%. Diamondback Energy (FANG) led the downside after dropping almost 7%.

The S&P sectors were mostly negative, with only consumer discretionary, technology and real estate in the green. Financials and energy stocks were the biggest laggards.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 34522.45 -263.90 -0.76
S&P 500 (0S&P5) 4335.14 -17.20 -0.40
Nasdaq (0NDQC ) 14631.27 -8.05 -0.05
Russell 2000 (IWM) 225.57 -3.62 -1.58
IBD 50 (FFTY) 44.56 -0.29 -0.65
Last Update: 2:54 PM ET 7/6/2021

Small caps were slapped lower by the bears, with the Russell 2000 falling around 1.6%. Growth stocks were faring somewhat better, but the Innovator IBD 50 ETF (FFTY) still gave up 0.7%.

Dow Jones Falls As Apple Stock Rises

The Dow Jones Industrial Average rallied off session lows, but was still down around 0.8%

Apple stock was showing strength heading into the close, gaining around 1.2%. AAPL was boosted after JPMorgan Chase raised its price target to 170 from 165 and maintained an overweight rating.

Apple stock drove higher in its buy range from a 13.17 buy point. Volume was running well above average.

This is a boost, as it had been lacking since Apple stock broke out of a cup without handle last week.

American Express stock had also been running well, but gave up much of its gains. While it was still one of the few positive Dow Jones stocks, it was only up around 0.5%

The downside action was more brutal, with Dow Inc. (DOW) the worst laggard, falling almost 2.5%. Walt Disney (DIS) also suffered, falling more than 2%.

Tesla Stock Hits Reverse Amid Lawsuit

Tesla stock was struggling Tuesday, dipping by around 3.5%. The stock made a bullish move Friday on delivery data, but its RS line is currently dipping.

Tesla stock now sits below a buy zone from an aggressive entry point of 675. It had previously moved above a trend line, but got turned away at the 700 level.

Tesla stock was pressured after it emerged the firm is getting sued by the family of a 15-year-old killed in a car crash involving a Tesla on Autopilot. The suit claims Autopilot does not work properly, and failed to detect traffic conditions.

Tesla stock got a boost last week after it revealed it had delivered 201,250 vehicles in Q2, up from the prior record of 184,800 in Q1 and 90,900 a year ago.

It also produced 206,421 vehicles, including 204,081 Model 3 and Model Y EVs, and 2,340 Model S and X vehicles.

AMC Stock Falls As GME Dips

Meme stocks were struggling amid the selling.

AMC stock, the current big beast of meme stocks, had risen early, but was forced down around 3.5%. It is on track for a third down day in a row. Other meme stocks were mixed on Tuesday.

The cinema stock currently has dreadful earnings performance, but massive price spikes have caused its Relative Strength Rating to reach a perfect 99. Its stock is up more than 2,000% so far this year.

The firm said Tuesday it decided not to seek shareholder approval for a proposal that would have allowed it to issue as many as 25 million extra shares.

AMC initially laid out that proposal in a notice for its annual shareholder meeting, set for July 29. But CEO Adam Aron said the company was trying to take shareholder sentiment into consideration.

GameStop was falling even harder, giving up almost 4%. It is now up just over 900% for the year. Last week Baird suspended coverage of the video game retail stock due to Reddit influence and a perceived lack of a company plan.

Leader, IPO Stock Pass Buy

New issue Monday.com managed to race out past an IPO base buy point at 237.60. While it had surged above its buy zone, it is now just above its buy point after giving up some ground.

The relative strength line hit a new high, which is encouraging.

Goldman Sachs, JPMorgan, Jefferies and other analyst firms have all issued bullish recommendations on the Israel-based cloud software stock.

Canaccord Genuity analyst David Hynes initiated Monday.com with a buy rating and 275 price target. He noted, “You want to make your bets with a vendor that’s spending aggressively to establish initial beachheads and then has the architectural foundation that makes for easy expansion — that’s Monday.”

Leaderboard name DocuSign also managed to move above an entry of 290.33, according to MarketSmith. The stock is currently sitting below its entry from this very long consolidation pattern, however.

DocuSign had its position size raised from a quarter to a half Tuesday after it broke past last week’s high of 286.51.

Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.

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