Dow Jones futures briefly surged more than 900 points Tuesday morning after the release of cooler-than-expected inflation data. The Federal Reserve’s two-day policy meeting will also kick off Tuesday. And Boeing stock jumped further past a buy point after receiving a new Dreamliner order from United Airlines.
CPI Inflation Data
Inflation data showed the Consumer Price Index rose 0.1% on the month of November, cooler than the expected 0.3% rise. The index rose 7.1% year over year, lower than the 7.3% Econoday estimate.
In addition, the next meeting Fed meeting kicks off Tuesday with an interest rate decision on Wednesday. While the Fed has already heavily telegraphed a 50-basis-point hike, investors will be looking for further guidance on the Fed’s plans. According to the CME’s FedWatch tool, traders place a 79% chance of a 50-basis-point rate hike.
Late Monday, Oracle (ORCL) reported earnings and sales numbers that topped analyst estimates. Oracle shares jumped 4% in early morning trade. More earnings reports this week include Darden Restaurants (DRI) and Lennar (LEN).
Electric-vehicle giant You’re here (TSLA) traded 4.5% higher Tuesday. Among Dow Jones stocks, Boeing (BA) jumped 3% after United Airlines (UAL) ordered at least 100 of the aerospace giant’s 787 Dreamliners, with an option to buy 100 more new jets. Boeing shares are extended past a 173.95 buy point in a cup base.
Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) were also sharply higher ahead of today’s stock market open.
Allegro Microsystems (ALGM), IBD Stock Leaderboard Dexcom (DXCM), KLA (KLAC) and Interactive Brokers (IBKR) — as well as Dow Jones names Caterpillar (CAT), Home Depot (HD) and UnitedHealth Group (UNH) — are among the top stocks to buy and watch.
Dexcom and Trane are IBD Leaderboard stocks. UnitedHealth was featured in this week’s Stocks Near A Buy Zone column. Allegro was a recent IBD 50 Stocks To Watch pick. Caterpillar, Interactive Brokers and Dexcom were recent IBD Stock Of The Day companies.
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Dow Jones Today: Oil Prices, Treasury Yields
Ahead of Tuesday’s opening bell, Dow Jones futures rose 2.1% vs. fair value as Boeing rallied and Merck (MRK) surged more than 2% after clinical trials showed positive results from a joint cancer-treatment therapy with Moderna (MRNA). Moderna stock was up by more than 10% premarket.
S&P 500 futures gained 2.7%, and tech-heavy Nasdaq 100 futures moved up 3.5% in morning action.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) rose 3.5% and the SPDR S&P 500 ETF (SPY) moved up 2.7% early Tuesday.
The 10-year US Treasury yield ticked lower to 3.44% Tuesday morning, diving after the release of the CPI inflation data.
Meanwhile, US oil prices continued to rebound Tuesday morning, rising 1.6%. West Texas Intermediate futures traded above $73 a barrel. Natural gas futures climbed toward a fifth-straight advance, up 3.7% in early trade to $6.83 per million British thermal units.
Stock Market Rally
The stock market ended with solid gains on Monday. The Nasdaq composite rose 1.3%, the S&P 500 added 1.4%, and the Dow Jones Industrial Average climbed 1.6%. The Russell 2000 rose 1.2% and found support at the 50-day moving average.
Monday’s The Big Picture column commented, “Indexes are in an indecisive phase, trading above support levels but also testing resistance. The Nasdaq remains above its 50-day moving average and the 11,000 level. But the S&P 500 met resistance at the 200-day moving average and has yet to regain the 4,000 level.”
Now is an important time to read IBD’s The Big Picture column amid the ongoing stock market volatility.
Five Dow Jones Stocks To Buy And Watch Now
Dow Jones Stocks To Buy And Watch: Caterpillar, Home Depot, UnitedHealth
Dow Jones member Caterpillar continues to drift further away from a cup base’s 238 buy point, according to IBD MarketSmith pattern recognition, in the wake of Monday’s 2.5% advance. CAT stock shows a solid 95 out of a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. CAT stock climbed 1.5% Tuesday.
Home improvement retailer Home Depot ended Monday about 1% below a cup-with-handle base’s 329.77 buy point. HD stock rallied more than 2% Tuesday morning, on pace to break out past the latest buy point.
Health care giant UnitedHealth Group is tracing a flat base that features a 558.20 buy point. Shares are just 3% away from the latest entry. UNH stock added 0.6% early Tuesday.
4 Top Growth Stocks To Watch In The Current Stock Market Rally
Top Stocks To Buy And Watch: Allegro, Dexcom, KLA, Interactive Brokers
Allegro Microsystems ended Monday in buy range past a cup-with-handle’s 32.07 buy point following the day’s 0.1% gain. ALGM stock traded up about 1.5% Tuesday.
IBD Leaderboard stock Dexcom is trying to break out past a 123.46 buy point in a flat base and is just below the entry. Dexcom stock ticked up 0.8% early Tuesday.
Chip leader KLA is moving further past a cup-with-handle’s 392.60 entry after Monday’s 1.9% advance. Bullishly, the relative strength line continues to make new highs in the ongoing market volatility. KLA shares were up 1.5% premarket Tuesday.
Interactive Brokers has formed a cup-with-handle pattern with an official 81.56 buy point, according to IBD MarketSmith analysis. But shares are below their 50-day line after Monday’s losses. A decisive retake of that level would be bullish for the stock’s immediate prospects. IBKR stock moved up 1% Tuesday.
Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live
Tesla stock skidded 6.3% Monday, giving up the entirety of Friday’s gains and heading back toward its recent lows. Shares rebounded 4.5% Tuesday morning.
In recent weeks, TSLA stock hit its lowest level since Nov. 23, 2020, reaching a new 52-week low price at 166.19. Shares closed Monday at 167.82, about 58% off their 52-week high.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares rallied 1.6% Monday, still below its key 50-day line. The 50-day line, which had been a key support level, has switched into an area of resistance to monitor. The stock is about 21% off its 52-week high. Apple stock traded up 3.1% on Tuesday.
Microsoft jumped 2.9% Monday, as shares continue to hold support at the 50-day line. The software giant remains around 27% off its 52-week high. Microsoft shares rose 3.5% early Tuesday.
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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