Dow Jones rises 500 points ahead of inflation data; Bold meeting; Tesla stock nears 2022 low

Dow Jones futures were lower before Tuesday’s open after the Dow Jones Industrial Average rose 528 points on Monday. Tesla shares skidded more than 6% on Monday, ending close to 2022 lows.


Inflation Data, Fed Meeting

Data for consumer inflation will arrive on Tuesday morning. The CPI is expected to rise 0.3% for the month of November and 7.3% year over year, according to Econoday estimates. In addition, the next Federal Reserve policy meeting will take place on Tuesday and Wednesday.

While the Fed has already forecast a 50 basis point hike, investors will be looking for further guidance on the Fed’s plans. A pivot from aggressive tightening looks unlikely, but some respite from punishing rate hikes would be welcome. According to CME’s FedWatch tool, traders have a 74% chance of a 50 basis point rate hike.

The 10-year government yield ticked up to 3.61% on Monday.

Late Monday, Oracle (ORCL) jumped 3% after the company’s earnings and sales numbers topped analyst estimates. More earnings reports this week include Darden restaurants (DRI) and Lennar (LEN).

The stock market today

On Monday, the Dow Jones Industrial Average rose 1.6%, or 528 points, and the S&P 500 gained 1.4%. The technology-heavy Nasdaq composite followed with a rise of 1.3%. Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) rose 1.3% and the SPDR S&P 500 (SPY) gained 1.4%.

Electric vehicle giant Tesla (TSLA) traded down 6.3% on Monday. Among Dow Jones stocks, apple (AAPL) rose 1.6% and Microsoft (MSFT) rose 2.9% in today’s stock market.

Allegro MicroSystems (ALGM), IBD Leaderboard stock Dexcom (DXCM), CLOTHES (KLAC) and Trane Technologies (TT) – as well as Dow Jones names larva (CAT), Home Depot (HD) and UnitedHealth Group (UNH) — is among the best 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 and Dexcom were recent IBD Stock Of The Day companies.

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

Dow Jones Futures Today: Oil Prices

Ahead of Tuesday’s opening bell, Dow Jones futures, S&P 500 futures and tech-heavy Nasdaq 100 futures all lost 0.1% against the real 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.

US oil prices rose more than 3% on Monday, rebounding from year lows. West Texas Intermediate futures traded just above $73a a barrel.

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.”

Although the Nasdaq and S&P 500 indexes remain in uptrends, defense is still better than offense at this time due to ongoing market volatility. That means it’s OK to look for stocks to buy, but keep your positions small at first while keeping your overall exposure light.

When it comes to new purchases, what kind of feedback do you get from the market? Are your recent purchases making solid progress? In that case, it’s okay to give them some space. But don’t be afraid to take partial profit if a gain reaches at least 10%. If new buys go the wrong way, or are met with immediate selling, cut losses when the stock is down 3% to 4%, rather than waiting for the 7%-8% rule to trigger.

(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 buy and watch: Caterpillar, Home Depot, UnitedHealth

Dow Jones member Caterpillar moves closer to a cupbase’s 238 buy point, according to IBD MarketSmith pattern recognition, in the wake of Monday’s 2.5% gain. CAT stock scores a solid 95 out of a perfect 99 IBD Composite Rating, according to IBD Stock Checkup.

Home improvement retailer Home Depot ended Monday less than 1% below a cup-with-handle base’s 329.77 buy point after the session’s 2.3% advance.

Healthcare UnitedHealth Group is tracking a flat base with a buy point of 558.20. Shares are just 2% off their last close on Monday.

Top stocks to buy and watch: Allegro, Dexcom, KLA, Trane

Allegro MicroSystems ended Monday in buy territory past a cup with handle’s 32.07 buy point after today’s weak rise. ALGM shares traded up 0.1% on Monday. And the 5% hunting zone goes up to 33.67.

IBD Leaderboard stock Dexcom tried to break out past a 123.46 buy point in a flat base, but is about 5% below its entry after recent losses. Dexcom shares rose 0.3 percent on Monday.

Chip leader KLA moves further above a cup of handle 392.60 entry after Monday’s 1.9% advance. Bullishly, the relative strength line continues to make new highs in the ongoing market volatility.

Trane Technologies ended Monday about 4% below a 181.72 buy point in a cup with handle after the session’s weak decline.

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

Tesla shares

Tesla shares slid 6.3% on Monday, giving up all of Friday’s rally and heading back towards recent lows.

In recent weeks, TSLA stock has hit its lowest level since November 23, 2020, hitting a new 52-week low of 166.19. Shares closed Monday at 167.82, about 58% off their 52-week high.

Dow Jones Leaders: Apple, Microsoft

Among the Dow Jones stocks, Apple shares rose 1.6% on Monday, but are still below their 50-day line after last week’s losses. The stock is more than 20% off its 52-week high.

Microsoft rose 2.9% on Monday, as shares continue to hold above the 50-day mark. The software giant is still about 27% 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.


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

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