Will Powell Testimony Threaten Stock Market Rally? Apple, Tesla in focus

Dow Jones futures were little changed ahead of Tuesday’s open after the Dow Jones industrial average pared gains to just 40 points on Monday. Federal Reserve Chairman Jerome Powell’s testimony is due Tuesday. Apple (AAPL) stock rose to an analyst buy rating Tesla (D.S.L.A) shares fell after the company made an additional round of price cuts.


Powell Testimony

Fed Chair Powell is set to begin Two days of congressional testimony on Tuesday, and he will have an opportunity to explain the central bank’s planned response to a more resilient economy. Last month, the central bank raised rates by a quarter of a percentage point, and investors will be looking for clues on the size of the hike at this month’s March 21-22 meeting.

Currently, traders are placing a 69% chance of a quarter-percentage-point rate hike at the next meeting. CME’s FedWatch tool.

Then, on Friday, the Labor Department’s February employment report will be released. Econoday estimates nonfarm payrolls are expected to increase by 215,000 in February.

Guide (WireMixed fiscal-Q2 results were announced late on Monday. Shares rose about 1% in extended trading. The stock is forming a bottom with a buy point of 78.76.

This week also includes a major earnings report Wholesale PJ’s (BJ), CrowdStrike (CRUD), Dick’s Sporting Goods (D.K.S), JD.com (J.T), MongoDB (MTP), Thor occupations (THO) and Ulta beauty (Ulta)

Stock market today

On Monday, the Dow Jones Industrial Average and the S&P 500 both rose 0.1%. The tech-heavy Nasdaq composite fell 0.1% after posting solid gains.

Electric car company Tesla fell 2% on Monday. In Dow Jones stocks, Apple rose 1.85% and Microsoft (MSFTThe stock market rose 0.6% in today’s action.

Share on the IBD Leaderboard Alterix (AYX), Arista Networks (Aneta), Palo Alto Networks (PANW) and Sales force (CRM) — as well as Dow Jones stocks American Express (AXP) and JP Morgan Chase (JPM) — is one of the best stocks to buy and watch amid recent stock market strength.

Alterix is ​​a IBD Leaderboard Stock. And Salesforce was featured in this week’s Stocks Near a Buy Zone column.

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Dow Jones Futures Today: Oil Prices, Treasury Yields

Before the opening bell on Tuesday, Dow Jones futures, S&P 500 futures and Nasdaq 100 futures were little changed against 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 stock market session.

The 10-year U.S. Treasury yield rose again on Monday, to 3.98%. Oil prices edged up 1% from early losses as West Texas Intermediate futures traded above $80 a barrel. WTI futures were trading around their recent highs.

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What to Do in a Strengthening Stock Market Rally

With the stock market trending back in a “confirmed uptrend” after sharp gains in recent sessions, it’s a critical time to read IBD’s The Big Picture column.

The current uptrend is strengthening, which justifies holding a higher exposure level of 60% to 80%. But if Powell’s testimony spoils the party this week, investors should raise their exposure in a disciplined manner.

(See similar IBD stock lists IBD 50 (For additional stock ideas, Stocks Near the Buy Zone.)

Five Dow Jones Stocks to Buy and Watch Now

Dow Jones stocks to buy and watch: American Express, JP Morgan

American Express forms a handle base with a giant cup showing a 182.25 buy point. Shares are 2% short of their buy point as they fell on Monday. Bullishly, the stock’s relative strength line is at new highs, a particularly positive sign ahead of a potential breakout.

Despite Monday’s 0.6% loss, banking giant JPMorgan remains in a buy range above its 138.76 flat-base buy point, according to IBD MarketSmith chart analysis. Shares are recovering from their key 50-day moving average.

JPM share Shows a solid 94 IBD composite rating out of a perfect 99 IBD Stock Checkout. Composite Rating is designed to help investors easily find the best growth stocks.

Best stocks to buy and watch: Palo Alto, Salesforce

Cybersecurity leader Palo Alto Networks remains a striking distance above the site’s 193.01 buy point, following a 12.5% ​​gain on Feb. 22. Shares fell 1.9% on Monday, ending 2% away from the latest entry.

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Back story: Last week, the cybersecurity company reported better-than-expected results for the quarter ended January, with earnings reaching $1.05 a share, up 81% from a year ago, on a 26% jump in revenue to $1.7 billion.

Last week, Dow Jones leader Salesforce made a nice break above a 178.94 buy point on strong fourth-quarter results. Shares rose 11.5% to 187.89 on Thursday and are in a 5% buy zone.

Back story: Salesforce sells the software under a subscription model. Its software helps businesses organize and manage sales operations and customer relationships. The company has expanded into marketing, customer services and e-commerce. Salesforce said it has disbanded its “M&A committee,” which will no longer pursue large acquisitions amid growing pressure from activist investors.

Arista, Alterix hit recent buying points

Arista Networks returned to a buy range above a 140.91 buy point from a cup floor after a 1.35% advance on Monday. A decisive retracement puts the stock in a buy range going up to 147.96.

Back story: Arista sells switches that speed up communications between racks of computer servers packed into data centers. According to analysts, Arista is targeting the so-called “enterprise” market – large corporations, government agencies and academic institutions. Revenue grew 72% in the most recent quarter.

IBD Leaderboard stock Alteryx cleared a trendline buy point of 66.50 within a handle on Friday’s early stage cup. Serious investors can buy on a breakout above the trendline, while a typical entry at 70.73 is also in play. The stock is about 5% away from that buy point.

Back story: The Irvine, Calif., company developed a self-service platform for data analytics. Demand is clearly strong, as sales rose from a low of $100 million per quarter in 2021 to $216 million in Q3 2022, up 75% from a year ago, and $301 million in Q4 2022, up 73%. This rapid revenue growth is one of the reasons Alterix posted a profit of 84 cents per share in Q4, possibly the largest quarterly earnings in the company’s history.

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Tesla stock

Tesla shares fell 2% on Monday after the EV giant cut US vehicle prices once again on Sunday evening, the latest sign demand for Tesla vehicles may be slowing after an initial boost from January price cuts.

On Sunday, Tesla cut the price of the Model S by $5,000, bringing the base version to $89,990. Meanwhile, the price of a Model X SUV dropped by $10,000, bringing the base version to $99,990, according to pricing on Tesla’s website.

Despite a strong rebound since January 6, shares are still below the 200-day line. That key position is a potential resistance area. Shares closed Monday about 50% off their 52-week high. Aggressive investors can use the February 16 high to 217.65. However, to be safe, Tesla stock needs to clear the 200-day line, which is now below 221.

On Tuesday, weekly China EV insurance registration data could be an important measure of Tesla demand in the world’s largest EV market amid a massive price war launched by Tesla.

Dow Jones Leaders: Apple, Microsoft

On the Dow Jones, Apple shares rose 1.85% on Monday, closing on Feb. Ended at the highest level since 15. Earlier Monday, Goldman Sachs initiated coverage with a buy rating and a 199 price target, a 31% premium to Friday’s closing price.

Shares of Microsoft moved above their 200-day line after a 0.6% gain on Monday. After the recent decline, the stock is at 20% of its 52-week high. MSFT shares rose 0.3% on Monday.

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