Dow futures rose slightly on Monday afternoon, along with S&P 500 futures and Nasdaq futures. Crude oil prices rebounded as OPEC+ unexpectedly agreed to a small production cut. Meanwhile, Russia has said the flow of natural gas to Europe will remain shut down until Western sanctions are lifted.
The stock market rally fell sharply again last week, breaking through key levels.
With major indices heading south and few stocks looking healthy, investors should have a big cash position and wait for better conditions.
apple (AAPL) will be in focus this week, with tech giant Dow Jones appointed to iPhone 14 unveiled On September 7, Apple stock was under construction until it fell over the past several sessions along with the broader market.
Arista Networks (Network) has a similar chart style to Apple’s, but the ANET stock has some differences that might make it more attractive. However, ANET repository is not actionable.
The video included in the article explored the market movement in depth, with an analysis of Apple, Arista Networks and Enphase Energy stocks.
Energy price hike
Crude oil futures are up more than 2%, from Monday morning’s highs. OPEC and key allies like Russia agreed to cut production quotas by 100,000 barrels per day in October. Production cuts were on the table but not expected. It’s unclear if actual production will ever drop that much, because many of the cartel’s members weren’t meeting current quotas. However, it does send a signal about OPEC+ concerns about current crude prices and supply and demand amid a weak global economy.
Meanwhile, US natural gas prices are down slightly after rising 3% earlier. Natural gas prices rose in Europe after falling last week from record highs in the stratosphere. Russia’s state-owned Gazprom last week shut down Nord Stream 1 pipeline to Europe, for only three days of maintenance. But the pipeline did not restore flows on Saturday. The Kremlin, ignoring the pretense of maintenance issues, said on Monday that the flow of natural gas would not return to normal until the West lifted sanctions over the invasion of Ukraine. Europe is gathering supplies for the winter.
Dow jones futures contracts today
Dow futures rose 0.4% against fair value. S&P 500 futures rose 0.3% and Nasdaq 100 futures rose 0.2%.
US stock markets are closed on Monday at Labor Day holidaybut other exchanges around the world were open.
Dow futures, which are trading normally, close at 1 PM ET and will reopen at 6 PM ET.
China extends Covid lockdown in Chengdu, capital of Sichuan’s industrial province of 21 million people. The coastal technology hub, Shenzhen, which underwent mass testing this weekend, is facing progressive restrictions.
stock market rise
The stock market rally is a recovery in name only. It extended its recent losses, although it finished slightly above Thursday’s lows.
The Dow Jones Industrial Average lost 3% in the past week stock market trading. The S&P 500 fell 3.3%. The Nasdaq Composite Index fell 4.2%. Small cap Russell 2000 fell 4.7%
The 10-year Treasury yield rose 16 basis points to 3.19%, its fifth consecutive weekly gain despite falling on Friday from a two-month high.
US crude oil futures fell 4.9 percent to $86.87 a barrel last week.
Natural gas futures fell 5.2%, almost all of it on Friday.
between the Best ETFsThe Innovator IBD 50 ETF (fifty) is down 6.4% last week, while the creator of the IBD Breakout Opportunities ETF (fit3.5% surrendered. iShares Expanded Technology and Software Fund (ETF)IGV) fell 4.4%, with several high-value software names crashing into the IGV last week. VanEck Vectors Semiconductor Corporation (SMH) 6.7%.
SPDR S&P Metals & Mining ETF (XME) is down 8.4% last week, with steel stocks melting after some flashing buying signals last week. Global Infrastructure Development Fund X US (cradle) declined by 4.6%. US Global Gates Foundation (ETF)Planes) It lost nearly 4%. SPDR S&P Homebuilders ETF (XHB) is down 3.3%. SPDR Specific Energy Fund (SPDR ETF)XLE) and the Financial Select SPDR ETF (XLF) down 3.4%, although after three weekly gains. SPDR Healthcare Sector Selection Fund (XLV) decreased by 1.8%.
Apple Stock vs. ANET STOCK
Apple stock fell 4.8% to 155.81 last week, falling below the 200-day line and finally the 50-day line. AAPL stock still has a handle of 176.25 buy pointbut the handle looks less attractive.
The Relative force line Still close to highs. This shows that Apple stock is down significantly with the S&P 500 index.
Apple’s fourth-quarter earnings fell, as analysts saw double-digit EPS growth in fiscal year 2022 and 2023.
ANET stock fell 4.7% to 117.30, also retreating from its 200-day line, as Friday’s rebound faded. The stocks didn’t quite go down to the 50-day streak during the week, even though they tested the 10-week streak. Arista stock has a buy handle point of 132.97 at double bottom base.
Meanwhile, Arista’s earnings and sales growth have accelerated over the past three quarters, with EPS up 59% and revenue up 49% in the second quarter. Analysts see 40% EPS growth in 2022 and 13% in 2023.
Arista’s earnings may be seen as more vulnerable than Apple’s. A significant reduction in corporate IT spending could weigh on network stocks while demand for the Apple iPhone and services appear to be more stable.
Other stocks to watch
ENPH stock fell last week by 3.3% to 279.07, but is trading relatively tight and maintaining support around the 21-day moving average. The leading solar energy company is traded relatively tightly, and it can have flat base On the weekly chart after another week. Enphase stock could also continue to slide – or move sideways – to test the fast-rising 50-day and 10-week lines. That could provide a buying opportunity, assuming ENPH stock bounces from there.
NBIX stock fell 1.8% last week to 103.01 to close near the 21-day line. On Friday morning, Neurocrine bounced off this level and approached a short entry in the trendline, but reversed lower as the market reversed. NBIX stock is not far from the 50-day line, which currently roughly coincides with the previous 100.10 buy point. Biotech needs another two weeks to form a proper base.
LNTH stock fell 3.7% last week to 78.48, closing slightly below the 21-day streak, according to MarketSmith Analysis. A fast-rising 21 or 50 could offer a new entry in Lantheus, which cleared a previous base in August, but in some unruly business.
Market Rise Analysis
The stock market rally is a recovery in name only. Since the S&P 500 stopped short of its 200-day moving average on August 16, major indices have been on the decline. Federal Reserve Chairman Jerome Powell’s Aug. 26 speech to Jackson Hole’s, which pointed to a more aggressive and depressing Fed, led to a sharper sell-off.
In the past week, all major indicators fell below the 50-day moving averages. They have already bounced off intraday lows on Thursday, with only the Nasdaq Composite avoiding undermining its lows in late July.
On Friday morning, indicators rebounded in the August jobs report, which showed strong hiring but also a long-awaited jump in the workforce. But after the S&P 500 and Russell 2000 reached their 50-day lines, the indices made an ugly reversal.
The 50 day moving average is now acting as a ceiling against the support. Getting past this level is key, but it’s only an initial test. The 21-day line is another key level, roughly coinciding with sharp downtrends in the Nasdaq and S&P 500. But the real key is to break above the 200-day moving average.
On the flip side, the Nasdaq’s breakout from Thursday’s lows will likely mean the official end of the rally of the very distressed market.
Many blue-chip stocks suffered a lot of damage in the past week. While some stocks like ENPH and NBIX are holding up relatively well, they are not making progress.
Shares of potential Apple and ANET aren’t dropping much more than the broader market. It is an example of why investors want to buy stocks amid an uptrend in the market.
Energy stocks are in their own realm of oil and gas prices, but they are subject to large price swings, sometimes at the whims of authoritarian leaders. The OPEC+ production cut and Russia’s decision to outright suspend natural gas shipments until sanctions are lifted may provide tailwinds to energy stocks on Tuesday.
What are you doing now
Investors should have minimal exposure and prepare patiently for a better market environment. Until major indices regain their 50-day or 21-day moving averages, investors probably shouldn’t consider fresh buying. The only exception may be oil and gas names, but investors should tread carefully even there.
The rapid rise and reversal from the 50-day line may have provided some short selling opportunities. Another attempt at Pentecost could do it again in the coming days.
So build your long and short watchlists, which are likely to need a lot of changes from a week ago. On the upside, focus on stocks with strong relative strength, even if they don’t have perfect patterns.
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