The Dow Jones Industrial Average rallied more than 200 points Monday morning as investors digested an early round of economic data. Tesla (TSLA) stock jumped 4% after the electric-vehicle leader said its German production plant is now producing 4,000 cars per week ahead of schedule. Meanwhile, China-based Tesla rival Li Auto (LI) surged more than 4% on better-than-expected fourth-quarter earnings and sales results.
The Commerce Department’s durable goods orders dropped 4.5% in January, more than the expected 4.0% fall, following December’s 5.6% jump tied to aircraft orders. Meanwhile, Wall Street expects the National Association of Realtors’ pending home sales index to rise 1%. The pending home sales index is due out at 10 a.m.
Later this week, the Institute for Supply Management’s manufacturing survey index is slated for Wednesday at 10 a.m. ET, followed by the ISM service-sector gauge on Friday at 10 a.m.
Among other companies reporting earnings this week include C3.ai (AI), Costco Wholesale (COST), Dollar Tree (DLTR), Kohl’s (KSS), Lowe’s (LOW), Macy’s (M), Ross Stores (ROST), Salesforce (CRM) and Workday (WDAY).
Stock Market Today
IBD Leaderboard watchlist stock Palo Alto Networks (PANW), Deere (DE), Toll Brothers (TOL) and Wingstop (WING) — as well as Dow Jones stocks Cisco Systems (CSCO) and JPMorgan Chase (JPM) — are among the top stocks to watch, with the recent stock market weakness.
Dow Jones Today: Oil Prices, Treasury Yields
After Monday’s market open, the Dow Jones Industrial Average rose 0.7%, and the S&P 500 moved up 0.75%. The tech-heavy Nasdaq composite gained 0.9% in morning action.
On Friday, the 10-year U.S. Treasury yield settled at 3.94%, rising for a fifth-straight week after the hot inflation report. Then on Monday, the 10-year yield ticked higher to 3.97%.
Oil prices paused after a two-day rally, with West Texas Intermediate futures trading just above $76 a barrel.
Stock Market Rally Struggles
On Friday, the Dow Jones Industrial Average sold off 1%, and the S&P 500 lost 1.05%. The Nasdaq composite tumbled 1.7%.
Friday’s Big Picture column commented, “The current uptrend is coming under increasing pressure, which justifies holding a lower exposure level of 40% to 60%. Pay special attention to sell signals within your portfolio. Cut stocks that fall 7% to 8% from your entry and holdings that break below the 50-day or 10-week moving averages.”
Dow Jones Stocks To Buy And Watch: Cisco, JPMorgan
Banking giant JPMorgan is in buy range above its 138.76 flat-base buy point after Friday’s 0.9% gain, according to IBD MarketSmith chart analysis. Shares are also rebounding from their key 50-day moving average. JPM shares traded up 0.7% early Monday.
Featured in last week’s Stocks Near A Buy Zone column, Cisco Systems fell further below a flat base’s 50.81 buy point during Friday’s 1.5% decline. Shares are trying to halt their slide around their 50-day line and are about 4% below the entry. Cisco stock gained 1.5% early Monday.
Top Stocks To Buy And Watch: Palo Alto, Wingstop
IBD Leaderboard watchlist stock Palo Alto Networks is building the right side of a base that has a 193.01 buy point in the wake of last week’s more than-10% jump. PANW stock rose 1.8% Monday morning.
Backstory: Last week, the cybersecurity giant announced very good results for the January-ended quarter that saw earnings hit $1.05 a share, up 81% vs. a year earlier, on a 26% jump in revenue to $1.7 billion.
Wingstop is back in the 5% chase zone past a 169.04 cup-with-handle entry that tops out at 177.49 after a two-day slide. Investors should wait for signs of support before considering a purchase of shares, especially amid the deteriorating general market conditions. WING stock moved down 1.2% early Monday.
Backstory: The Dallas-based restaurant chain has more than 1,900 locations in the U.S. and international markets, according to Dow Jones Newswires. Its international locations include Mexico, Colombia, Panama, Singapore and the U.K. Wingstop added 61 new locations in the fourth quarter, bringing Wingstop’s total footprint to 1,959 restaurants worldwide.
Deere, Toll Eye Latest Buy Points
Deere shares declined 1.8% Friday, giving up support around their 50-day line. Shares are 6% from a 448.50 buy point in a flat base. DE stock moved up 0.5% Monday morning.
Backstory: An industrial bellwether, Deere has shrugged off recession and inflation fears to deliver solid profits. In the last year, higher commodity prices let farmers buy both new and upgraded machines. In the fiscal first quarter ended Jan. 29, the tractor maker posted a 124% jump in per-share earnings on a 32.2% total revenue surge, both topping estimates. Earnings growth accelerated for a second-straight quarter.
Homebuilder Toll Brothers is building a cup-with-handle base that displays a 63.29 buy point. Bullishly, the stock boasts a relative strength line just off new highs after last week’s 50-day support. TOL stock shows a solid 95 IBD Composite Rating. Toll Brothers shares were up 2% early Monday.
Backstory: Last week, luxury homebuilder Toll Brothers topped earnings and revenue projections while maintaining its full-year guidance. The homebuilder’s financial report comes as a 12-month slide in U.S. existing home prices showed signs of slowing in January.
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Stocks To Buy And Watch In Stock Market Rally
These are six top stocks to buy and watch in today’s stock market, including two Dow Jones leaders.
|Company Name||Symbol||Correct Buy Point||Type Of Buy Point|
|Toll Brothers||(TOL)||63.29||Cup with handle|
|Cisco Systems||(CSCO)||50.81||Flat base|
|Palo Alto Networks||(PANW)||193.01||Consolidation|
|Wingstop||(WING)||169.04||Cup with handle|
Source: IBD Data As Of Feb. 27, 2023
Tesla stock skidded 2.6% Friday, ending a two-day win streak. Despite their strong rebound since Jan. 6, shares are still below the 200-day line and that key level looms as a potential resistance area. Shares closed Friday around 49% off their 52-week high.
Shares on Monday looked to bounce back from Friday’s losses, racing 4% higher in early trade.
Tesla is set to hold its investor day Wednesday, with Chief Executive Elon Musk teasing plans to present his “Master Plan 3” at the event. Analysts say they know few details, and many doubt there will be any new product announcements. Musk says his “Master Plan 3” is about a “path to a fully sustainable energy future for Earth.”
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares sold off 1.8% Friday, giving up support around their 200-day line. Shares are around 18% off their 52-week high. Apple stock rose 1% Monday.
Microsoft shares again fell below their 200-day line, sliding 2.2% Friday. The stock is more than 20% off its 52-week high after recent losses. MSFT stock was up 1.05% Monday morning.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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