Home Market Spotlight Dow Jones Futures: Stocks rebound, but don’t feed bears; BYD Tesla delivers

Dow Jones Futures: Stocks rebound, but don’t feed bears; BYD Tesla delivers

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Dow Jones Futures: Stocks rebound, but don’t feed bears; BYD Tesla delivers

Dow Jones futures as well as S&P 500 futures and Nasdaq futures will open Sunday evening. Despite Friday afternoon’s rally, last week’s newly confirmed stock market rally quickly turned “under pressure” as the major indexes sold off.


Tesla (TSLA) and China’s BYD (BYDDF) should release sales figures over the weekend, following strong June deliveries from Li Auto (LI), NIO (NIO) and Xiaopeng Motors (XPEV).

Don’t feed the bears. Now is not a good time to make new purchases; investors should have little or no exposure. Instead, prepare for the next bull run.

Northrop Grumman (NOC), McKesson (MCK), Centene (CNC), AstraZeneca (AZN) and Shockwave Medical (SWAV) all performed quite well. Both have relative strength lines at 52-week or consolidation highs.

BYD stock is also worth watching, trading near a buy point. Tesla stock is near a 2022 low.

NOC stocks are on the IBD leaderboard. Ideal Motors, Centene, McKesson and AZN stocks are on the IBD 50. CNC Stock and McKesson are also on the IBD Big Cap 20.

The video embedded in this article reviews BYD stock, AstraZeneca, and Privia Health Group (PRVA).

Dow Jones Futures Today

Dow Jones futures open at 6 p.m. Sunday, with S&P 500 futures and Nasdaq 100 futures open.

U.S. stock exchanges will be closed on Monday for Independence Day, but other markets around the world will be open. Dow Jones futures will trade as normal on Monday.

Remember, overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.

Analyse actionable stocks in a stock market rally with an IBD expert on IBD Live

stock market rebound

The stock market rally took another hit, with Friday’s gains only paring weekly losses.

The Dow Jones Industrial Average fell 1.3% in stock market trading last week. The S&P 500 fell 2.2%. The Nasdaq Composite fell 4.1%. The small-cap Russell 2000 fell 2.1 percent.

The 10-year Treasury yield plunged 24 basis points to 2.89%, falling below 3%.

U.S. crude futures edged up 0.8% last week to $108.43 a barrel after rising 2.5% on Friday. Gasoline futures rose on Friday but fell this week.

Among the best ETFs, the Innovator IBD 50 ETF (FFTY) lost 1.1% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) edged up 0.25%. The iShares Expanded Tech-Software Sector ETF (IGV) fell 5.3%. The VanEck Vectors Semiconductor ETF (SMH) tumbled 9.3%. Semiconductor stocks were hit by a warning from Micron Technology (MU) following reports that Intel (INTC) was cutting PC chip prices.

The SPDR S&P Metals & Mining ETF (XME) fell 5.4% last week. The Global X US Infrastructure Development ETF (PAVE) fell 1.8%. The U.S. Global Jets ETF (JETS) fell 3.4%. The SPDR S&P Homebuilders ETF (XHB) edged up 0.5% on Friday’s strong rebound. The Energy Select SPDR ETF (XLE) rose 1.4% and the Financial Select SPDR ETF (XLF) fell 1.4%. The Healthcare Select Sector SPDR Fund (XLV) edged up 0.4%.

Reflecting more speculative stocks, the ARK Innovation ETF (ARKK) plunged 10.1% last week and the ARK Genomics ETF (ARKG) fell 5.3%. TSLA remains the largest holder of the Ark Invest ETF. Cathie Wood’s Ark also holds small stakes in BYD, Xpeng and NIO.

The five best Chinese stocks to watch right now

Tesla Delivery

Tesla is likely to report second-quarter production and delivery figures on Saturday. Analysts polled by FactSet, on average, expected Tesla to deliver 265,000 vehicles in the second quarter. That would be a sharp drop from Tesla’s record 310,048 electric vehicle deliveries in the first quarter.

Tesla Shanghai was closed for most of April and did not resume full production until early June. The recently opened Tesla factories in Berlin and Austin are producing relatively few cars, in part because of supply chain issues.

Tesla shares fell 7.5% last week to 681.79 after hitting 10-week line resistance on Monday. Shares were not far from their May 24 low of 620.57. TSLA stock peaked at 1,243.49 in early November.

Tesla vs. BYD: Which electric car giant is more worth buying?

BYD sales

The electric vehicle and battery giant’s electric vehicle and plug-in hybrid sales are set to surpass 100,000 for the fourth straight month. They are likely to surpass May’s record 114,943, with sales comfortably surpassing 320,000 in the second quarter.

That means BYD will overtake Tesla in car sales, although BYD will still lag its rivals in the delivery of pure electric vehicles.

BYD stock cleared a 39.81 buy point from the deep cup handle bottom for the week and ended the week up 1.2% at 39.97. BYDDF is still 17% higher than its 50-antenna. A tall handle or a short, shallow base might be ideal.

Chinese electric vehicle startup

On Friday, NIO reported record deliveries in June, while Xpeng and Li Auto had their best months since December. With past Covid-19 lockdowns and increased EV subsidies, the three startups should see significant growth in the second half of the year when they launch new models.

Li Auto shares fell 1.6% to 37.70 on Friday and were down 7.6% for the week, testing the 37.55 buy point. LI stock has extended significantly from the moving average, so entering is always risky. Building a new shallow base next to a deep consolidation would be ideal.

Shares of Nio and Xpeng fell 11.3% and 14.2%, respectively, last week, retreating from near their 200-day line after weeks of gains.

As capacity expands, BYD and Tesla should also see stronger Chinese production and demand in the coming months. BYD will also launch several models in the coming months, including the Model 3 rival Seal sedan.

Stocks to Watch

Northrop shares rose 4.9% last week to 486.37, rebounding from its 50-day line. Shares also surpassed the old 477.36 buy point that is no longer technically valid. But in recent months, there has been a lot of trading around that level. In another week, NOC stock could be flat.

Shares of McKesson rose 2.5% last week to 329.53, trading just above its 50-day line. The base buy point for MCK stock is 340.04. But investors can use Friday’s high of 330.16 as an early entry.

Centene stock rose 3.9% last week to 86.21. Shares encountered resistance this week at the double-bottom buy point of 87.44. But the current market pause may be healthy. CNC stock is likely to form a handle in a few days, lowering the official entry slightly to 87.08.

AstraZeneca stock also encountered resistance near a fundamental double-bottom buy point, pulling back after just breaking the 67.50 entry point on Wednesday, according to MarketSmith analysis. AZN shares fell 1.4% last week to 65.95, but found support at the 50-day line on Friday.

Shockwave stock edged up 0.5% last week to 198.62, consolidating after surging 25% last week. The big move pushed SWAV stock above the messy 194.41 cup handle bottom buy point. Investors could use 203.03, just above Tuesday’s high, as an entry. This could be an alternative treatment after Tuesday.

Market rebound analysis

Again, the newly confirmed stock market rally quickly ran into trouble. On Monday, the Nasdaq Composite hit resistance at its 10-week moving average and turned tail.

On Tuesday, the Nasdaq and S&P 500 closed below their subsequent session lows on June 24, a bearish sign that their rallies may ultimately fail. On Thursday, the Dow followed suit.

Despite a small upward reversal on Friday, the major indexes fell sharply this week.

The market rally isn’t technically over yet, but it’s “under pressure.”

Macroeconomic conditions are deteriorating. The Atlanta Fed’s second-quarter GDP tracker fell to -2.1% on Friday from -1% on Thursday and 0.3% on Wednesday. JPMorgan cut its growth forecast, saying the U.S. is “dangerously close” to a recession.

Consumer spending is slowing and inflation-adjusted spending is down. Manufacturing activity is still expanding at a slower pace, but the ISM’s new orders sub-index turned negative in June.

Companies are just starting to acknowledge the negative impacts, with Micron, RH (RH), General Motors (GM) and Nike (NKE) warning over the past week. That could continue into earnings season and earnings season over the next few weeks.

Of course, while investors should be aware of major economic and business trends, you should pay attention to where the market is currently moving. Currently, the market is in a severe downtrend that dates back to early 2022 or late last year. The recent rally appears to be exiting fast.

Healthcare stocks are strong, but they could lose ground if the bear market falls again. Defense stocks are picking up, and Northrop is joining several other companies.

BYD and Ideal Cars look fun, but take a breather. Most auto stocks, including Tesla, are on the back foot.

Use IBD’s ETF Market Strategy to Time the Market

what to do now

Now is not a good time to invest. If you buy stocks in resilient sectors like healthcare or defense, be prepared to make at least some of your profits quickly. Downtrend, volatile markets can quickly wipe out sizable gains.

Instead of trying to pick rare winners in a bear market, investors should look to spot the big bellwethers in the next sustained uptrend.

Build your watch list and do research on some promising companies.

Read the big picture every day to stay abreast of market direction and leading stocks and sectors.

Follow Ed Carson on Twitter @IBD_ECarson for stock market updates and more.

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