Dow Jones futures rose modestly Monday afternoon, along with S&P 500 futures and Nasdaq futures, after the stock market rally kept running last week. Walmart (WMT), Medtronic (MDT) and InMode (INMD) report earnings early Tuesday.
U.S. stock markets are closed for the Presidents Day holiday.
InMode stock is in a deep cup-with-handle base. Progyny stock and Ping stock have tripped aggressive buy points within consolidations. RH (RH) is set to clear a buy point after Berkshire Hathaway (BRKB), run by Warren Buffett, disclosed that it bought more RH stock. Taiwan Semiconductor Manufacturing (TSM) has retaken key support.
Because TSM stock, RH stock, INMD stock, PGNY stock and Ping stock had prior recent uptrends, their relative strength lines have a decent track record amid the powerful stock market rally.
Walmart stock is in a base, but has lagged the S&P 500 index for months. Medtronic stock is at the top of a buy zone.
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Dow Jones Futures Today
Dow Jones futures rose 0.25% vs. fair value. S&P 500 futures climbed 0.2% and Nasdaq 100 futures advanced 0.4%. Remember that overnight action in Dow futures, RH stock and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
Dow Jones futures have a long time to trade with U.S. stock markets closed Monday. Other exchanges around the world were not. The Shanghai composite jumped 2.3% on new Chinese stimulus efforts. Japan’s Nikkei fell 0.7% as Japanese GDP plunged in Q4. European markets rose modestly.
Current Stock Market Rally
The current stock market rally kept racing last week. The Dow Jones Industrial Average rose 1%, the S&P 500 index 1.6% and the Nasdaq composite 2.2%. All hit record highs.
Is the stock market rally due for a pullback? The major indexes and many leading stocks are stretched. But that’s been true throughout 2020, and the stock market rally has treated potential roadblocks as minor speed bumps.
Analysts expect Walmart earnings per share to edge up 1% to $1.43 with sales rising 3% to $42.48 billion, according to Zacks Investment Research. The Dow Jones retail giant’s same-store sales, excluding gasoline and foreign currency swings, are seen up 2.2%, according to Consensus Metrix.
Walmart earnings rose 7% in Q3 after slim declines in Q1 and Q2.
Walmart stock rose 1.2% last week to 117.89, reclaiming its 50-day line after finding support at its 200-day line in late January. WMT stock does have a 125.48 flat-base buy point. But the RS line for Walmart stock has been falling since early October, hitting a 10-month low last week. The RS line, the blue line in the charts below, tracks a stock’s performance vs. the S&P 500 index.
Wall Street sees Inmode earnings of 39 cents per share vs. a 1-cent year-earlier loss, with revenue up 49% to $43 million. InMode uses radiofrequency technology to melt fat and tighten the skin.
InMode stock cleared a short consolidation in late October, nearly doubling to 58.76 on Nov. 18. Shares then plunged 41% to 34.60. INMD stock has since formed a 23%-deep handle, also not ideal.
InMode stock dipped 0.4% to 43.96 on Friday, continuing to find support at its 50-day line. InMode stock has a 53.30 conventional handle entry. Aggressive investors could buy INMD stock if it breaks a short trend line within the handle.
InMode stock is prone to big swings so investors should size positions accordingly. That also goes for Progyny stock and, somewhat, Ping stock.
INMD stock priced at 14 a share in August.
Analysts expect Medtronic earnings to rise 7% to $1.38 per share. The medical products giant’s sales should climb 4% to $7.81 billion.
Medtronic stock closed Friday at 117.33, holding above its 50-day. Medtronic stock is just within range from a 112.15 flat-base buy point.
RH Stock Gets Another Warren Buffett Boost
Berkshire Hathaway disclosed late Friday that its RH stock holdings grew by 41% in Q4 to 1.71 million shares. Warren Buffett’s Berkshire bought 1.2 million shares in Q3, which spurred a 7.6% jump in RH stock on Nov. 16.
RH stock rose 3.3% to 245.99 late Friday, signaling a breakout above a 243.77 buy point for the upscale home furnishings chain. Aggressive investors could have bought RH stock as it cleared 229.80 on Feb. 11 or as it rebounded from its 10-week line on Feb. 10 while breaking a short trend line.
The RS line for RH stock is climbing, but not yet at its December peak. That follows a strong six-month rise.
Taiwan Semiconductor Stock
Taiwan Semiconductor stock has a flat base with a 60.74 buy point, according to Marketsmith analysis. Last week TSM stock climbed 3.5% to 58.19, retaking its 50-day. Shares retreated in late January following Taiwan Semi earnings and amid the coronavirus pullback that hit chip names.
Progyny stock cleared a short trend line last week, offering an aggressive entry. PGNY stock has been consolidating, but not long enough to be a proper base. Investors could still treat 35.53 as a legitimate buy point for Progyny stock.
PGNY stock cleared short patterns in early December and early January, but they quickly failed.
The Progyny IPO priced at 13 in late October.
Ping stock has a new flat base with a 28.11 buy point. Shares of the cybersecurity company flashed an aggressive entry Friday as it rebounded from its 10-week line, but pared intraday gains.
Ping stock cleared an IPO base of 21.10 in late November, rising to 28.01 on Jan. 15.
Ping was a recent Stock Of The Day.
September’s Ping IPO priced at 15 a share.
Please follow Ed Carson on Twitter via @IBD_ECarson for stock market updates and more.
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