Dow Jones futures fell slightly relative to fair value on Sunday, as did S&P 500 futures and Nasdaq futures.Last week, the stock market experienced a decisive breakthrough. Coronavirus cases have surged, lockdowns have continued to increase, the presidential election is imminent, and major earnings reports such as Apple stocks Shopify (shop), Microsoft (MSFT) and Amazon.com (AMZN) Unable to meet the requirements of Wall Street.
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The Dow Jones, S&P 500 and Nasdaq Composite have suffered their worst weekly declines since March.Major indexes and many leading stocks categorically fell below key supports, including apple (AAPL), Shopify, Microsoft and Amazon stocks and Adobe (ADBE), Tesla (TSLA) etc. All of these indicate a new, negative stock market direction.
When the trend rises, make money in the stock market. But in the past few weeks, the characteristics of the stock market have become increasingly negative. In this environment, investors need to adopt a defensive approach to greatly reduce risk exposure. Having 100% cash is not a bad strategy.
But stay engaged. The direction and characteristics of the stock market may change soon.
Pay close attention to relatively strong stocks and keep them near the buy zone.Examples include Jingdong (JD), Current service (just now), Monolithic Power System (MPWR) and Idexx Lab (IDXX). Of course, they may not keep going. Many stocks that entered the recovery period fell last week.
Meet 5 technologies with strong recent buying points
Microsoft, Adobe, ServiceNow, JD.com and Tesla stocks are all on the IBD rankings. Microsoft stocks, Adobe and Idexx Labs are long-term IBD leaders. Amazon stocks, ServiceNow and Adobe are on IBD 50. Monolithic Power stock is the IBD stock on Friday.
Dow Jones Futures Today
Dow Jones Index futures fell 0.3%. S&P 500 futures fell 0.2%, and Nasdaq 100 futures fell 0.3%.
The surge in coronavirus cases and the coronavirus lockdown may cause damage to the global economy, especially in Europe and the United States
At the same time, China’s manufacturing index showed continued growth in October, while non-manufacturing activities rebounded.
Keep in mind that overnight trading in Dow Jones Index futures and elsewhere will not necessarily translate into actual trading in the next regular stock market session.
Join the IBD experts who analyze the operational stocks in the rising stock market on IBD Live.
Coronavirus news
There are 46.8 million coronavirus cases worldwide. The death toll from Covid-19 exceeds 1.2 million.
In the United States, the number of coronavirus cases has reached 9.47 million and the death toll has exceeded 236,000.
Last Friday, the number of new coronavirus cases worldwide exceeded 573,000, easily setting a daily record.
On Friday, the number of new coronavirus cases in the United States reached 101,461, surpassing the daily record before Thursday (91,834) and 81,811 (Wednesday). In many states, the number of hospitalizations has soared.
The UK will begin a new partial lockdown on Thursday, as the number of coronavirus cases on Saturday exceeded 1 million. Spain and France have recently surpassed the number of Covid-19 cases.
With the surge in coronavirus cases in Europe, the United Kingdom and Belgium were partially blocked after France and Germany. The number of Covid cases per capita in Belgium is the highest in the world. Part of the coronavirus lockdown in France began on Friday, Germany and Belgium on Monday, and the UK on Thursday.
In the next few weeks, we should obtain early data on the final phase of trials of coronavirus vaccine candidates in the following ways: Pfizer (PFE) and partners Biotechnology (BNTX) and may be submitted for FDA authorization in late November. Until last week, Pfizer said it would get some early data before the end of October. modern (MRNA) may launch its Covid-19 vaccine in a few weeks.
Stock market trends last week
U.S. stock market overview today |
||||
|---|---|---|---|---|
| index | symbol | price | Gain/loss | Percentage change |
| Dow Jones | (0DJIA) | 26,503.57 | -155.54 | -0.58 |
| S&P 500 | (0S&P5) | 3270.14 | -39.97 | -1.21 |
| Nasdaq | (0NDQC) | 10,911.59 | -274.00 | -2.45 |
| Russell 2000 | (and many more.) | 153.11 | -2.03 | -1.31 |
| IBD 50 | (FFTY) | 35.95 | -0.98 | -2.65 |
Last update: October 30, 2020 at 4:10 p.m. EDT |
||||
The stock market performed poorly, with major indexes suffering their biggest decline since March.
The Dow Jones Industrial Average fell 6.5% in stock market trading last week. The S&P 500 Index plummeted 5.6%. The Nasdaq Composite Index fell 5.5%. All stocks fell sharply through their 50-day moving average. The Dow Jones Index has fallen below its September low and is currently testing the 200 antenna.
Apple shares fell 5.4% last week, Microsoft fell 6.4%, and Amazon fell 5.25%. SHOP shares fell 9.8%, Adobe fell 8.5%, and Tesla fell 7.75%. Tesla’s sell-off was carried out against the backdrop of a sharp rise in strong electric car stocks such as China’s NIO.
Contrast with more resilient stocks. JD.com shares edged up 0.2% last week. MPWR shares fell 0.6%, Idexx Labs fell 1.3%, and ServiceNow fell 3.2%, all thanks to the positive response to the earnings report.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) fell 6.2% last week. The iShares expanded technology software industry ETF (IGV) fell 7%, with Microsoft, Adobe and ServiceNow being all the main components. The VanEck Vector Semiconductor ETF (SMH) fell 4.9%.
At the same time, after nearly three weeks of retreat, the recent days have stimulated significant losses in the chart.
This is an important time for reading The Big Picture.
Why use this IBD tool to simplify the search for popular stocks
Lack of good character in the stock market
There is a lot of discussion about whether the stock market is in an “upward trend under pressure” or a “market correction.” To some extent, this is an arbitrary dividing line.
The real problem is that at some point, the stock market will change from a general upward trend to a general downward trend. A day or two in a downtrend does not necessarily mean that the role has returned to positive.
This is the focus of follow-up work. CAN SLIM investors do not have to fill out bureaucratic paperwork. This is a way for the stock market to prove personality changes.
The goal is to enter a new market rebound relatively quickly, but wait until there is evidence of a decisive role change. You need a few days of trends to go higher, and then a lot of time to confirm.
Therefore, ignore the label for now. Consider the current stock market.
A good day will not herald a change in roles. Thursday was a stable day, but in the end it did not herald a positive change in the direction of the stock market.
The stock market needs to decisively break the downward trend of the major indexes. At present, the positive direction of the stock market may cause Nasdaq to return to its 50-day trading range significantly. But this will not happen in one day, unless you get really amazing benefits. At this point, many leading stocks, such as those of Apple, Amazon and Tesla, have been severely damaged and it will take time to fix their charts.
The CBOE Volatility Index (often called VIX) is at a four-month high. Excessive fear is usually related to short-term market bottoms. However, despite the market concerns that the index rose slightly on Friday, it never exceeded Wednesday’s intraday high. VIX may need a larger spike to indicate the bottom and possible new stock market direction.
The next few days will be difficult to explain. Even if Dow Jones futures hinted at a rebound on Sunday night, and the trend is strong on Monday and Tuesday, the market may undergo a dramatic shift after election day. Therefore, although JD.com, Monolithic Power or other stocks close to the buying point may explode, investors should know that the risk is very high.
IBD/TIPP poll shows Trump is hopeful in Biden’s broad prowess
Game plan for the upcoming week
It is hoped that investors have been reducing their risk exposure as earnings dries up and breakthroughs turn into losses. However, please double check your remaining positions. Which ones should be reduced further or completely?
At the same time, focus on building your watch list. The turnover may be high, and many promising stocks seem to be broken. Continue to look for stocks close to the buying point, but look for stocks with a strong line of relative strength, even if they are not in a position. In the next few weeks, they may form a new merger.
The earnings season will remain heavy.
Horizon therapy (HZNP) and Lumentum (LITE) Report earnings before opening on Monday. Paypal (PYPL), Freshpet (FRPT) and Apple iPhone supplier Skyworks solution (SWKS) and Cirrus Logic (CRUS) After the report is closed.
Follow Ed Carson on Twitter at: @IBD_ECarson Information about stock market updates and more.
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