Stock futures improved into mixed trade ahead of Monday’s starting bell, with Dow Jones futures taking an early lead. Biogen rallied ahead of an expected FDA decision. U.S. Concrete and QTS Realty spiked on acquisition news. Earnings news sent G-III Apparel toward a buy point. Analyst actions sent Visa to the head of the Dow Jones today.
Dow Jones futures crept up 0.1%, while S&P 500 future flattened to just a fraction below fair value. Nasdaq 100 futures lagged 0.2% on the stock market today, as China-based names and some pandemic tech leaders including Zoom Video (ZM) and DocuSign (DOCU) posted mild declines.
Recently beaten-down stocks led the early action: Biogen (BIIB) and Peloton (PTON) topped the Nasdaq 100. Biogen rose 3.2%, also leading the S&P 500. The Food and Drug Administration is expected to decide Monday whether to approve Biogen’s aducanumab as the first treatment addressing the underlying causes of Alzheimer’s disease. Wall Street forecasts give the drug a 50% chance of approval.
Biogen shares are poised beneath a 290.46 buy point in a cup-with-handle base.
In earnings news, G-III Apparel (GIII) rallied more than 6% after scoring a big first-quarter earnings beat. The owner of the Donna Karan brand closed Friday 8% below a 34.08 buy point in a cup-with-handle base.
Logistics leader C.H. Robinson (CHRW) rose 1.7% following a Goldman Sachs upgrade to buy, from sell, with 108 price target. C.H. Robinson stock ended Friday below a 102.75 entry in what IBD MarketSmith analysis plots as a cup-with-handle base.
Dow Jones Today: Visa Upgraded
Visa (V) was the early leader on the Dow Jones today, up 1.2% early after Piper Sandler upgraded the stock to overweight, from neutral and Barclays gave Visa stock a modest price target hike, to 284, from 275. Piper Sandler placed its price target at 260.
Visa stock finished Friday with a modest year-to-date gain of 5.5%. Shares are below a 237.60 buy point in a five-week flat base. The stock is a solid play on improving circumstances for financial names, but its relative strength rating is a very weak 39.
Economic News, 10-Year Treasury Yield
The economic calendar gets a bit of a break this week, after a busy first week of June. But Monday gets started amid a flurry of news and events, including Apple’s Worldwide Developers Conference, a G-7 agreement for a global minimum corporate tax rate, a potentially telling product cancellation from Tesla (TSLA), plus some market and interest-rate-related commentary from Treasury Secretary Janet Yellen.
The 10-year Treasury yield edged up to 1.58%, according to CBOE data, after falling to end Friday at 1.56%, the lowest settle since May 6.
5 Leading Stocks To Watch
IBD’s Investing Action Plan points to these five leaders as key stocks to watch this week: Google parent Alphabet (GOOGL) is in a flat base and near a 2,431.48 buy point. Dell Technologies (DELL) is also in a flat base and working on a 103.90 entry. Fox Factory (FOXF) has formed a flat base with a 166.98 buy point. Applied Materials (AMAT) is consolidating with a 146.10 pivot. Bio Techne (TECH) is heading toward a 444.93 buy point from a flat base.
U.S. Oil Prices Hit $70
Oil price futures eased slightly after West Texas Intermediate crude briefly touched $70 a barrel early Monday. West Texas Intermediate is the benchmark oil contract for the U.S. market.
WTI futures rose 4.9% last week to close at $69.62 a barrel, their highest level since Oct. 2018. WTI touched a high of $76.90 that month. Oil prices gained despite the prospect of returning supply from Iran, as well as last week’s agreement from the Organization of Petroleum Exporting Countries and partners led by Russia to increase production beginning this month. That stubborn oil price increase sends a bullish signal to energy markets and related stocks.
S&P 500 Eyes Record; Nasdaq Nears 14,000
The stock market starts the week with its status upgraded to “uptrend resumes” for the first time since May 12. The Nasdaq Composite capped a wobbly, three-week rally by punching back above support at its converged 50-day and 21-day moving averages on Friday.
That put the index about 1.3% below the 14,000 mark, the level which has capped the index’s progress since February.
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The S&P 500 jumped to within 0.2% of its record high from May 7. The Dow Jones today sits about 1% below its May 10 record high. Both the Dow and the S&P 500 have shown firm support at their short-term 21-day moving averages.
The upshifted market status opens investors to a more aggressive game plan. Even so, don’t jump all in at once: get back into the market gradually after a follow-through day. Focus on fundamentally strong stocks coming out of sound chart patterns. Stay disciplined and stick to sound buy and sell rules.
Dow Jones Today: Blue Chips In Bases
Goldman Sachs (GS) is an IBD SwingTrader stock. Microsoft (MSFT) remains on IBD’s Leaderboard list. Goldman Sachs scored a 5.2% gain last week, putting it 9.7% above a 356.95 buy point after a May 5 breakout. Shares were added to the SwingTrader line-up on June 4, following a rebound from the stock’s 21-day exponential moving average.
Microsoft narrowly retook its 50-day line on Friday. It is six weeks into a flat base pattern with a 263.29 buy point.
The gain put Salesforce back above 10-week support, as it fashions a possible base within a longer-term consolidation. It is showing potential alternative buy points at 238.43 and 251.33.
Boeing has also climbed back above support in a 12-week base. The proper buy point is currently at 278.67, but the stock may be forming a handle that would lower the buy point.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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