Dow Jones falls ahead of Fed minutes; Tesla shares plunge to a new low

Dow Jones futures were little changed before Tuesday’s open after the Dow Jones Industrial Average ended with modest losses on Monday. Tesla shares plunged to a 52-week low and neared a two-year low. Minutes from the Federal Reserve’s latest policy meeting are due on Wednesday.

X

The short holiday week will receive a deluge of economic data on Wednesday, including consumer sentiment, durable goods orders, initial jobless claims, PMI readings and new home sales. The stock market will be closed Thursday for Thanksgiving, along with a shortened trading session on Friday.

Dell (DELL), Urban Outfitters (URBN) and Zoom video (ZM) were key earnings moves late Monday. DELL shares reversed down 2.5% in extended trade, while Urban shares rose nearly 3%. Zoom Video shares fell more than 5% in late trading.

Third quarter earnings season continues this week, with reports from Baidu (BEGIN), Best buy (BBY), Deere (OF), Dick’s Sports Equipment (DKS), Dollar tree (DLTR) and Nordstrom (JWN).

The stock market today

On Monday, the Dow Jones Industrial Average lost 0.1%, or 45 points, and the S&P 500 fell 0.4%. The technology-heavy Nasdaq composite sold 1.1 percent.

Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 1% and the SPDR S&P 500 (SPY) fell 0.4%.

Electric car giant Tesla ( TSLA ) slid 6.8% Monday. Among Dow Jones stocks, apple (AAPL) traded down 2.2% and Microsoft (MSFT) rose 0.3% in today’s stock market.

IBD Leaderboard stock Arista Networks (A WEB), GlobalFoundries (GFS), CLOTHES (KLAC) and Shoals Technologies (SHLS) – as well as the Dow Jones name larva (CAT) – is among the best stocks to buy and watch.

Arista Networks is an IBD Leaderboard stock and was a recent IBD Stock Of The Day. GlobalFoundries was featured in last week’s columns for stocks near a buy zone. Shoals was Thursday’s IBD 50 Stocks To Watch pick.

4 top growth stocks to buy and watch nowra stock market rally

Dow Jones Futures Today: Treasury Yields, Oil Prices

Ahead of Tuesday’s opening bell, Dow Jones futures, S&P 500 futures and tech-heavy Nasdaq 100 futures were little changed relative to fair value. Keep in mind that overnight action in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular session.

The 10-year Treasury yield ticked up to 3.82% on Monday, snapping a two-day winning streak.

US oil prices plunged briefly on Monday after the Wall Street Journal reported that OPEC was considering a production increase of up to 500,000 barrels a day. Later, Saudi Arabia denied the report, sending oil prices sharply down from their lowest levels. West Texas Intermediate futures traded below $76 a barrel on Monday before paring losses.

IBD’s latest newsletter MarketDiem brings you actionable ideas for stocks, options and crypto straight to your inbox.

What to do in the stock market rally

Now is an important time to read IBD’s The Big Picture column with the stock market trending back in a “confirmed uptrend.”

At this point, it is important to be flexible. Despite the early decline in November, investors should maintain a cautious stance and limit exposure to no more than 40%. Wait for more confirmation of continued strength before adding more exposure. Immediate distribution in the major stock indexes would be a sign to stay more defensive.

If your recent stock purchases continue to make progress, you should feel more confident about the stock market rally. But sharp reversals and losing trades will of course be signs of keeping more of the powder dry.

(Check out IBD stock lists like the IBD 50 and Stocks Near a Buy Zone for more stock ideas.)

Five Dow Jones Stocks to Buy and Watch Now

Dow Jones stocks to watch: Caterpillar

Dow Jones member Caterpillar remains below the cup base’s 238 buy points, according to IBD MarketSmith pattern recognition, following a recent breakout attempt. Caterpillar shares rose 0.3 percent on Monday.

CAT stock boasts an impressive 95 out of a perfect 99 IBD Composite Rating, according to IBD Stock Checkup.

Top stocks to buy and watch: Arista, GlobalFoundries, KLA, Shoals

IBD Leaderboard stock Arista Networks remains above a choppy base’s 132.97 buy point despite Monday’s 0.6% drop.

Chip foundry GlobalFoundries remains in buy territory above a 66.06 buy point in a cup base after Monday’s 2.05% loss, according to IBD MarketSmith pattern recognition.

KLA is building a cup with handle that has a buy point at 392.60 amid Monday’s 1.1% drop. Bullishly, the stock’s relative strength line hit a new high last week, a sign of big outperformance compared to the S&P 500.

Shoals Technologies remains out of buy territory past a 28.57 buy point despite a second straight decline on Monday. The 5% buy zone peaked at 30. Wait for an orderly pullback into the buy zone before considering a stock purchase.

Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live

Tesla shares

Tesla stock slid 6.8% on Monday, extending a losing streak to four sessions and falling to its lowest level since November 23, 2020.

Shares are about 58% off their 52-week high and sharply below their 50- and 200-day moving average lines. Meanwhile, the stock’s RS line continues to hit new lows, indicating major stock market underperformance compared to the S&P 500.

Dow Jones Leaders: Apple, Microsoft

Among the Dow Jones stocks, Apple shares sold off 2.2% on Monday, but remain above their recently recaptured 50-day line. The stock is about 20% off its 52-week high.

Microsoft rose 0.3% on Monday, ending a three-day losing streak. Shares continue to hold above the 50-day mark. The software giant is still more than 30% off its 52-week high.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.

YOU MAY ALSO LIKE:

Top Growth Stocks to Buy and Watch

Learn how to time the market with IBD’s ETF Market Strategy

Find the best long-term investments with long-term IBD managers

MarketSmith: Research, charts, data and coaching in one place

How to research growth stocks: Why this IBD tool simplifies the search for top stocks