Dow Jones Futures: Market Rally Powers Past Warning Signs As Tilray Plunges; Disney, Datadog Lead 4 Key Earnings Movers
Dow Jones futures fell slightly early Friday, as did S&P 500 futures and Nasdaq futures as Walt Disney (DIS), Datadog (DDOG) and Cloudflare (NET) Headlined Earnings.
The stock market rally had a mixed session on Thursday, but the Nasdaq Composite and S&P 500 Index record closes. Tilray (TLRY) and other marijuana stocks fell Thursday after rising as high as a kite for the past few days.
Stocks traded up and down on Thursday, with a strong end pushing the Nasdaq back above the 14,000 level, leaving the warning signs behind. Bitcoin rebounded at record highs on recent signs of institutional support.
Screen of the Day: Cook your own list of leading stocks
The megacap technicians Apple, Microsoft (MSFT), Amazon.com (AMZN) and Google parents alphabet (TogetL) were meh. But big chip names like Taiwan Semiconductor (TSM), Nvidia (NVDA), Lam Research (LRCX) and Applied materials (AMAT) had strong meetings.
Disney stock, Datadog, Cloudflare and recent IPO To confirm (AFRM) reported gains after all four closed in the buy area.
Disney stock rose slightly on strong results. The DDOG share fell slightly under mixed forecasts. NET stock fell on the inline forecast. Acknowledge that the stock was sold, even though the views were beaten in their first report since going public.
Aurora cannabis (ACB) also reported gains late Thursday. The Canadian pot producer exceeded sales forecasts. Aurora stock rose 5% in expanded trading, reducing initial profits. ACB stock fell 23.5% Thursday but was still up 13% over the course of the week.
Marijuana stocks fell after huge gains on Thursday. Tilray stock fell 50% to 32.16 on Thursday after rising sharply before the Open. It is still above its 10-day line after closing 117% above this short-term level on Wednesday.
Aphria (APHA), which is merging with Tilray, slipped 36% on Thursday. Canopy growth (CGC) and Cronos (CRON) lost 22% each.
TLRY stock fell overnight, but most other marijuana stocks rose slightly following the Aurora earnings report.
Justice Investigates GME Stock Frenzy
Reddit investors have plunged into cannabis stocks after the rapid surge and fall GameStop (GME) and AMC Entertainment (AMC). The Justice Department has issued subpoenas to Robinhood and various brokers and social media companies regarding the massive short squeeces in GME stocks and others. The Commodity Futures Trading Commission is investigating whether Reddit investors are talking about silver futures and related ETFs.
In addition, the House Financial Services Committee is planning a hearing on February 18 about the GameStop stock rush. Steve Huffman, CEO of Reddit, will testify.
GME stock fell 0.2% to 51.10 on Thursday for the fourth consecutive day of below par volume. GME stock is 89% down from its January 28 high of 483. AMC stock lost 3.3% on Thursday, 73% from its January 27 high of 20.66.
Apple (AAPL), Microsoft, Nvidia and TSM stocks are on the IBD leaderboard. Nvidia Stock and Taiwan Semi are on SwingTrader. Microsoft stocks are long-term leaders on IBD. TSM, Nvidia and AMAT stocks are on the IBD 50 list.
Dow Jones Futures today
Dow Jones futures lost 0.1% from fair value even when Disney stock offered a small boost. S&P 500 futures fell 0.2%. Nasdaq 100 futures were down 0.1%.
Remember that night action in Dow futures and elsewhere does not necessarily result in an actual trade in the next regular trading session.
Analyze actionable stocks in the stock market rally on IBD Live with IBD experts.
Coronavirus cases worldwide since the pandemic began hit 108.29 million. Covid-19 deaths topped 2.37 million.
Coronavirus cases in the US have hit 28 million people, with deaths over 486,000.
Stock market rally
The stock market rally remained at record highs, trading up and down on Thursday, but in a relatively narrow range.
The Dow Jones Industrial Average closed just below break-even in trading on Thursday. The S&P 500 Index rose 0.2% and the Nasdaq Composite rose 0.4%.
Bitcoin price rose to a record high above $ 48,900 on Thursday evening and fell back to around $ 48,000. MasterCard (MA) said it will make Bitcoin and some other cryptocurrency transactions easier while Bank of New York Mellon (BK) said it would be a cryptocurrency custodian. On Monday, Tesla (TSLA) said it bought $ 1.5 billion worth of bitcoin, which rocketed the digital currency.
The Apple share fell 0.2% to 135.13. The stocks consolidate just below a buy point of 138.89 cup-with-handle. AAPL stock is finding support around its 21-day exponential moving average and just above its 50-day / 10-week lines.
MSFT stock, a component of the Dow Jones, S&P 500, and Nasdaq like Apple, rose 0.7%. It’s still in a buy zone.
FANG’s two trillion-dollar stocks, Amazon and Google, lost 0.7% and gained 0.1%. AMZN stock forms a handle as it returns to its 50-day line. TogetL stock is trading tight after hitting a record high in earnings last week.
TSM stock, which had no issues with market capitalization of $ 722 billion, fell 4.1% in a brief consolidation to a new high. Nvidia stock rose 3.3% to 610.03, still in the range of Wednesday’s breakout, above a buy point of 587.76. The graphics chip leader sped past an early entry of $ 560.07 billion on Monday.
LRCX stock rose 7.5%, just below a new high. The AMAT share rose 6.7% to its all-time best. Several other chip gear manufacturers made big profits.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) rose 1%, while the Innovator IBD Breakout Opportunities ETF (BOUT) rose 1.2%. The iShares Expanded Tech Software Sector ETF (IGV) rose 0.7%, with Microsoft stock being a top component. The VanEck Vectors Semiconductor ETF (SMH) gained 3.7%, with TSM stock being the largest SMH component. The stocks of Nvidia, AMAT, and LRCX are also important components.
Disney’s revenue and sales surpassed while Disney + subscribers now top 94.9 million. Disney stock rose nearly 2% overnight. The DIS share rose 0.75% to 191.05 on Thursday. On Monday, Disney hit a buy point of 183.50 flat-base positions after recently rebounding bullishly from its 50-day line. The buy zone for Disney shares is 192.68.
Datadog’s result exceeded expectations, but its profit forecast was below some estimates. The Datadog share fell 2.6% in extended trading. According to MarketSmith, DDOG stock rose 1.7% to 117.60 on Thursday, in the range of 111.59 cup-with-handle entries. The DDOG share purchase zone ends at 121.37.
Cloudflare earnings narrowly exceeded while forecasts were consistent. Cloudflare stock fell 7.4% below its recent buy points overnight. The NET share rose on Thursday by 0.4% to 91.24. Shares hit a consolidation buy point of 88.87 on Monday, with 87.25 being a slightly earlier entry. The official buy range ends at 93.31 for NET shares.
Confirm that earnings and sales exceeded second quarter views, with third quarter sales in line. Affirm stocks fell 8.7% in extended trading. AFRM shares rose 2.8% to 139.99 on Thursday. This left the IPO base free after attempting to close above the buy point of 138.08 in the last two sessions. An early entry of 123.55 on Tuesday was a better entry.
Analysis of the stock market rally
Bulls and bears have been battling for the Nasdaq 14,000 for the past few days, with bulls gaining the upper hand by Thursday’s close. It would be healthy if the composite could stay near these levels for several days or a few weeks. The Nasdaq is now 7.5% above its 50-day moving average, still extended and at risk of retreat. But the 50-day line could catch up quickly if the Nasdaq holds at or slightly below 14,000.
Investors can thank Apple and the other megacaps. By not going anywhere, they are helping keep the stock market rally from overheating. This gives other executives such as Chip and IPO names a little room to move on. Of course, if Apple and tech titans went up like the end of January, the Nasdaq could expand very quickly.
The main indices have been moving up and down over the last two sessions, but the daily swings have been relatively small, with minor changes from the closing bell. However, many leading stocks saw big gains or losses – not just GME stocks or Tilray. Investors need to take this into account when developing a game plan.
If the stock market rally sold out and the Nasdaq retreated to the 21-day or even the 50-day line, many high achievers, especially IPOs, could fall 10%, 20%, or more. What’s your strategy for your stocks?
Read the full picture each day to keep up with market direction and leading stocks and sectors.
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