Stock futures traded in tightly mixed territory ahead of the final session of August, as the S&P 500 prepared to clock its longest monthly advance in more than four years. Early action was subdued, ahead of an early round of economic news. Earnings reports sent shipping leader Matson higher in a buy range, while Zoom Video and American Woodmark dived. Intel nibbled out a lead on the Dow Jones today.
Dow Jones futures and S&P 500 futures dipped a fraction each. Nasdaq 100 futures defended a narrow gain, after leading the market by a wide margin on Monday. The Nasdaq and S&P 500 finished Monday’s session at record highs, with the S&P 500 poised to take a seventh straight monthly advance.
China-based stocks held four of the top five premarket moves on the Nasdaq 100 following strong sessions in Hong Kong and Shanghai. Vaccine maker Moderna (MRNA) was also in the mix, up 1.4% after a two-day retreat.
Textron (TXT) led the S&P 500, rising 1.6% after Cowen upgraded the aerospace leader and hoisted its price target to 95, from 75. Textron stock is in a buy range after clearing a double-bottom base buy point at 70.24. Shares hold an 84 Composite Rating from IBD.
Retailers fared well in early earnings news. Columbus, Ohio-based apparel chain Designer Brands (DBI) jumped more than 7%. ChicosFAS (CHS) climbed 4.5%. China-based game provider NetEase (NTES) gained 2.5%.
On the downside, Zoom Video Communications (ZM) toppled 12% after reporting second-quarter results. Cabinet maker American Woodmark (AMWD) dropped 6.7% on earnings. PVH (PVH), Ambarella (AMBA) and IBD 50 stock CrowdStrike (CRWD) are a few of the companies due to report after today’s close.
Dow Jones Today: Intel Leads, Goldman Lags
Intel (INTC) was the early leader on the Dow Jones today, up 0.3% in premarket trade. Goldman Sachs (GS) lagged at the bottom of the list, down 0.2%. Goldman remains narrowly extended after clearing a 393.36 buy point on Aug. 6.
Apple (AAPL) had rallied 3% on Monday, leading the Dow. Microsoft (MSFT) and Home Depot (HD) each climbed more than 1%. Apple remains in a buy range through 155.40. Microsoft is extended. Home Depot ended Monday less than 2% below a 333.55 buy point in a 16-week cup-with-handle base.
Apple and Microsoft are IBD Leaderboard listings.
Econ Data And Vital Signs: Oil, Bond Yields, Bitcoin
A fairly strong does of economic news could assert some influence on trade Tuesday morning. The S&P CoreLogic Case-Shiller Home Price Index and the Federal Housing Finance Agency’s House Price Index, both for June, are due out at 9 a.m. ET. The August Chicago Purchasing Managers Index is set for release at 9:45 a.m. ET, and the Conference Board delivers August consumer confidence numbers at 10 a.m. ET.
Oil futures traded lower, after rebounding in five of the past six sessions. West Texas Intermediate dropped 0.8%, to below $69 a barrel. Prices in early July hit $76.98, the highest level in almost seven years. Hurricane Ida in the Gulf Of Mexico triggered some volatile trade in both gasoline and oil futures on Monday.
Bond yields gained, with the 10-year yield rising to 1.30% following a settle below 1.29% on Monday. Bitcoin was down slightly, trading around $47,300, according to CoinDesk. Over the past 24 hours, the cryptocurrency moved as high as $48,715, and as low as $46,715.
China Rebound Continues; EU Inflation Hits 3%
China’s markets hammered out another positive session, carrying over last week’s rebound rally. The Shanghai Composite gained 0.45%. Hong Kong’s Hang Seng rallied 1.3%. That left the Shanghai benchmark ahead 4.3% for August. The Hang Seng pared its loss for the month to 0.3%.
Among China-based ETFs, the iShares MSCI China ETF (MCHI) traded 1.8% higher in morning trade. The Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR) was inactive. The KraneShares CSI China Internet ETF (KWEB) rallied 2.5%.
Europe’s markets were mixed near midday, after a report showed euro zone inflation topped 3% in August. Frankfurt’s DAX traded 0.2% higher, while London’s FTSE 100 rose slumped%. The CAC-40 in Paris dipped less than 0.1%. The SPDR Portfolio Europe ETF (SPEU) slipped a fraction, after bouncing 1.6% last week following a test of support at its 10-week moving average. The fund is trading 1% below a 44.06 entry in what IBD MarketSmith analysis marks as an 11-week flat base.
Stocks To Watch: Matson, Facebook
Matson (MATX) climbed 1.4% early Tuesday, riding a solid second-quarter sales and earnings beat reported late Monday. The stock ended Monday low in a buy range, above a 79.15 entry in what IBD MarketSmith analysis charts as a 27-week cup base. The buy zone extends to 83.11.
Facebook (FB) is also low in a buy range. It cleared a 377.65 buy point on Monday, and remains in a buy zone through 396.53.
Nasdaq, S&P 500, Dow Jones Today: A Strong Month For Growth Stocks
The Nasdaq and S&P 500 have each clocked new record highs in four of the past five sessions. The Nasdaq has now notched four closes above the 15,000 mark. The S&P 500 on Monday landed its second finish above 4,500. Both indexes are tracking toward their ninth monthly gain in the past 10 months.
The Dow continues to hold support above its short-term 21-day exponential moving average, after a healthy bounce off 50-day support. But its gains have been incremental. The index still trading less 1% above its high from early May, the index’s first tick above 35,000 — just as markets turned nervous after the Colonial Pipeline hack. Stalled infrastructure talks in Washington and uncertainty over a prospective change in Fed bond stimulus strategy have subsequently kept blue chips off balance.
For more detailed analysis of the current stock market and its status, study the Big Picture.
Among small caps, the Russell 2000 and S&P Smallcap 600 got lagged on Monday after punching out big gains last week. Both indexes are back above support as they attempt to scale up the right side of two-month consolidations. On the growth stock side, both the Innovator IBD 50 ETF (FFTY) and the Innovator IBD Breakout Opportunities ETF (BOUT).
The Innovator IBD 50 has rallied 7.6% so far in August, the Breakout Opportunities fund has a 4.4% gain. Both have easily led the market for the month, and have moved into pre-breakout positions within six month consolidations.
The iShares Russell 1000 Growth ETF (IWF) gained 3.9% in August, including 1% jump on Monday. It has topped e a 284.57 four-weeks tight entry and remains in a buy range that extends to 298.80.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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