Dow Jones futures were little changed overnight, along with S&P 500 futures and Nasdaq futures. The stock market rally saw a slightly positive session on the major indices on Tuesday. Small and mid-cap stocks, however, had a busy day.
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Two large holdings of Cathy Wood, Shopify (Shop) And Coinbase Global (currency), went in opposite directions on Tuesday.
SHOP stock rose strongly, extending Monday’s advance as an early entry flash. Transmedics Group (tmdx), Taiwanese semiconductor industry (TSM), life time group (LTH) And Marriott International (March) made upward movements.
Meanwhile, the Securities and Exchange Commission has accused Coinbase of being an unlicensed broker and violating other securities rules. COIN shares fell 12%, although they did pull back from intraday lows. Coinbase stock fell just over 9% on Monday, below its 50-day and 200-day lines, after the Securities and Exchange Commission filed a lawsuit against Binance, the world’s largest cryptocurrency exchange.
Store inventory added to IBD Leaderboard and SwingTrader on Tuesday. TMDX is located at defect 50. Shopify was also IBD stock for the day Tuesday.
Dow jones futures today
Dow futures fell against fair value. S&P 500 and Nasdaq 100 futures were flat.
The 10-year Treasury yield fell 3 basis points, to 3.67%.
Remember that overnight action in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
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Stock market rise
The stock market rally showed strong market breadth even with major indices trading in a narrow range.
The Dow Jones Industrial Average posted partial gains in stock market trading on Tuesday. The S&P 500 rose 0.2%. The Nasdaq Composite Index rose 0.4%. Small cap Russell 2000 jumped 2.7%.
US crude oil prices fell 0.6% to $71.74 a barrel. The 10-year Treasury yield rose 1 basis point, to 3.7%.
Exchange Traded Funds
Among the ETFs, the Innovator IBD 50 ETF (fifty(up 1.5% to a 2023 high. iShares Expanded Technology and Software ETF)IGV) increased by 0.2%. VanEck Vectors Semiconductor Corporation (SMH) jumped 0.7%. TSM stock is a major SMH component.
Reflecting more speculative stories, the ARK Innovation ETF (ARK)ark(gained 1.5% and ARK Genomics ETF)ARKG) figured 2.3%. As noted above, COIN and Shopify stocks are major holdings for Ark Invest’s ETFs. Tesla (TSLA), year (year) And Kings (DKNG) was another big constituent that posted strong gains on Tuesday.
SPDR S&P Metals & Mining ETFs (XME(up 2.4% and US Global X Infrastructure Development Fund (ETF) )cradle) 1.5%. US Global Gates Foundation ETF (Planes) rose 1.7%. SPDR S&P Homebuilders ETF (XHB) by 2.9%. Energy Defined Fund SPDR ETF (xle(Advance 0.8% and SPDR Healthcare Sector Selection Fund)XLV) decreased by 0.8%.
SPDR Financial Selection Fund (45) rose 1.3%. SPDR S&P Regional Banking ETF (Creates) nearly 5%, marking its best level since late April.
Top five Chinese stocks to watch now
Stocks in buy zones
Shopify stock jumped 6.2% to 63.66, clearly breaching the trend line in a short consolidation. Trading volume was the largest since the massive three-day run after first-quarter earnings. SHOP stock was already actionable on Monday as it bounced off the 21-day line. It’s starting to look stretched out. It is possible that the e-commerce giant will form a new base, but not until the end of next week.
TransMedics stock jumped 6.2% to 79.40, bouncing off the 50-day line on strong volume. TMDX stock has a 90.15 buy point, but it’s actionable here.
Taiwan Semiconductor rose 1.8% to 99.82, moving back above the 98.99 consolidation buy point in above-average trade, according to MarketSmith analysis. The chip foundry giant sees stronger performance in the second half of 2023 and has directed capital spending to a minimum from previous guidance. TSM stock exited its base on May 25th, following blowout results and guidance from major clients nvidia (NVDA), but quickly backed off. On Monday, stocks pulled back above the 21-day line before rebounding.
Life Time stock rose 4.2% to 20.94, regaining 20.35 basis buy points on strong volume. Investors can see the past few weeks as a flat bottom with 21.39 entry. LTH stock reached an 18-month high of 21.75 on the day.
Marriott stock rose 2.1% to 180.90, providing an early entry into an emerging flat base next to a year-round cup-handle base. The stable base of the MAR stock won’t be formed until Friday, but it will have 183.27 buy points. A move above the old buy point of 181.55 would mark another entry and signal a 52-week closing high.
Market rally analysis
The stock market rally had a dull day according to the major indicators, but there was underlying strength.
The Nasdaq rose but did not expand significantly. The S&P 500 continues to hold below its August 2022 highs. The Dow retreated to the 50-day line before reversing higher.
Meanwhile, the Russell 2000 and S&P 500 MidCap 400 both jumped to their best levels since March 9.
Invesco S&P 500 Equal Weight Fund (RSP) rose 0.7%, hitting a one-month high after restoring the 50-day and 200-day lines last Friday.
First Trust Nasdaq 100 Equal Weighted Mutual Fund (QQEW) rose 0.2% to a 52-week high.
Overall, the winners outperform the losers by more than 3-to-1 on the NYSE and by 5-to-2 on the Nasdaq. The number of stocks that reach new highs easily outpace those new lows.
The market rally was led by fewer tech giants and artificial intelligence games. Many of these names are paused or at least don’t cross domain. Maybe this is good for those stocks and the broader market. That could help keep the Nasdaq from overheating as more groups hopefully join the lead.
Home builders, construction products, medical products, and travel names show some strength.
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What are you doing now
With the main indicators holding steady, the market breadth showing a temporary positive trend and a small number of buying opportunities, investors can continue to gradually add purchases. It is an opportunity for investment-light traders to increase exposure, while those who have ridden the AI wave can diversify their portfolio.
Tremors remain common, while many stocks with deep bases look extended at traditional buy points. So look for early entry points, and try to buy the stock as early as possible to buy the points. This is where building your watchlists and setting alerts pays off. If you’ve done your homework, the real exams will be a lot easier.
Read the big picture every day to stay in sync with market trend, leading stocks and sectors.
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