Dow Jones Futures: Alibaba earnings provide insight into the impact of the China Trade War

Dow Jones futures rose modestly late on Tuesday, along with the S&P 500 futures and Nasdaq futures. Dow Jones and other major averages rose Tuesday, a modest bounce from Monday's higher volume sales of a growing China trade war. Apple stock and Boeing stock both steps but as Dow Jones remains under their 200-day line. Meanwhile, Alibaba reports shares and Tencent stock income before Wednesday's open. Alibaba (BABA) and archrival Tencent Holdings (TCEHY) will give some insight into how China's trade war affects the Chinese economy.

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Dow Jones Futures Today

Dow Jones futures rose 0.2% against fair value. Apple (AAPL) and Boeing (BA) are both Dow Jones components. S&P 500 futures climbed 0.2% and Nasdaq 100 futures advanced 0.25%. Keep in mind that takeover in Dow futures and elsewhere may not necessarily be translated into actual trading in the next ordinary stock market session.

Current Stock Market

The stock market regained Tuesday as President Donald Trump made a number of bullish statements regarding a trade in China. It helped Dow Jones and other major average revenues, about a third of Monday's sharp sales, as China retaliated after Trump hiked tariffs last week. But the Dow Jones Industrial Average is well below its 200-day average, while the Nasdaq composite and S&P 500 index is below the 50-day lines.

The Apple stock rose 1.6% and the Boeing share advanced 1.7%. But these gains follow losses of 5.8% and 4.9%, respectively, in much heavier volumes. The Apple stock fell more than 7% during a 197.97 buying point on Monday, making the listing invalid.

Among the best ETFs, Innovator IBD 50 (FFTY) increased 2.1% and iShares Expanded Tech Software Sector ETF (IGV) jumped 2.2%. VanEck Vectors Semiconductor ETF (SMH) rallied 2.6%. All three ETFs are still down the week.

Market Adjustment

Monday's sharp decline, along with last week's major losses, triggered a move in a stock market correction. While today's current stock market correction does not appear to be ready to repeat the serious end of the 2018 sales, it means investors should resist buying stocks for now.

China's good or ill preaching headlines are likely to drive the stock market up and down, at least in the short term.

Stock Market Rally Attempt

One day, not a stock market rally. Tuesday is the day one of an attempt to try within the stock market. Look for continued gains and large, higher volume sessions on one or more of the major averages. It will be due day to confirm the rally attempt.

Alibaba revenue

Wall Street expects Alibaba revenues to increase by 5% to 96 cents per share. The Chinese e-commerce titanium's revenue should jump 35% to $ 13.3 billion.

Alibaba Stocks attempted to break out of a deep cup-to-handle base with buying points of 188.18 or 189.89 in April to early May. But after beating a nine-month high of 195.72 in April, the Alibaba share tumbled while China's war suddenly escalated. Stocks fell into six quick sessions, beating a low of 168.78 intraday Monday.

The Alibaba share rose 2.8% on Tuesday to 174.84, but the buying points are now void.

Tencent Earnings

Analysts see Tencent's earnings of 32 cents a share, up 3%. Messaging and gaming giant revenues are seen up by about 10% to $ 12.8 billion.

Tencent warehouse is working at a deep, 15-month cup-with-shop purchase point of 51.34. Stocks have retreated in recent days. Tencent stocks, which are Hong Kong listed and traded over the counter in the US, rose 0.8% to 47.07 on Tuesday. It is still under its 50-day line.

Tencent, Alibaba Revenue and China Trade War

Revenue growth Tencent and Alibaba have slowed down growth in China's economy, partly due to China's trade war, including tariffs and hence investment uncertainty. Tencent earnings problems also reflect a long suspension of government approval of new mobile games.

Strong earnings and guidance will be a good sign that China's economy is doing OK, which will be bullish for the world economy. Weak results or points of view would indicate that the trade war in China, especially as it intensifies, could sustain fragile recovery.

Of course, signs of a strong Chinese economy could give Beijing policemen space to stay tough in China's trade war. A weaker economy can spur a desire to make some concessions in Chinese trade talks.

Chinese Mobile Game Specialist NetEase (NTES) and shipping giant ZTO Express (ZTO)

Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.

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