Futures, yields, falling oil after market growth;  Powell On Tap

Futures, yields, falling oil after market growth; Powell On Tap

Dow Jones futures fell sharply on Wednesday, along with S&P 500 and Nasdaq futures, with growing fears of a recession, and Fed chief Jerome Powell will testify before Congress on Wednesday morning.




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An attempt to recover the stock market had a strong session on Tuesday. But it is still an attempt to gather in the bear market.

Cheniere Energi (LNG), Ekkon Mobil (KSOM), Eli Lilli (LLI), General Dollar (DG), Tesla (TSLA) rival Li Auto (LI), UnitedHealth (UNH) i Northrop Grumman (NOC) showed strong positive action, with lines of relative strength at or near the maximum.

But few quality stocks are currently in position. That is just one of the many reasons to stay away. While the rally attempt is ongoing, the growth trend has not been confirmed yet.

Shares of Northrop and Eli Lilly are on the IBD leaderboard. Stocks of Auto Auto and Eli Lilly are on IBD 50. LLI stocks are also on IBD Big Cap 20.

Dov Jones Futures today

Futures Dow Jones fell 1.2% to fair value. The S&P 500 futures lost 1.45% and the Nasdaq 100 futures fell 1.65%.

The yield of the 10-year treasury fell by 9 basis points to 3.22%.

U.S. crude oil prices fell 4.5 percent. President Joe Biden on Wednesday called on Congress to suspend a federal gasoline tax of 18.4 cents a gallon for three months to provide temporary relief at the gas station.

Copper prices fell by more than 3% to their lowest level in 15 months due to a strong dollar and weaker economic growth.

Remember that overnight trading in Dow futures and elsewhere does not necessarily turn into real trading at the next regular session of the stock exchange.

Fed chief Powell testified

Fed chief Powell testified about monetary policy before the Senate Banking Committee on Wednesday morning. Powell will appear before the House Financial Services Committee on Thursday.

It is unclear whether Powell will open a new field from last week. On June 15, the Federal Reserve raised interest rates by 75 basis points, and the Fed chief said 50 basis points or 75 basis points were on the table for a policy meeting in late July. Markets have almost fully paid for another three-quarter point increase.

Fed chief Powell testified at 9:30 a.m. Eastern Time, right at the opening, although the Federal Reserve could have released his prepared remarks earlier.

Several Wall Street companies in the last few days now predict that the United States or the world will fall into recession, or that the chances will be almost 50-50.


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Stock market rally on Tuesday

The attempt to recover on the stock market had a strong session. The Dov Jones Industrial Average rose 2.15% in trading on the stock market on Tuesday. The S&P 500 index rose 2.45%. Tesla, Exxon and UNH were among the best S&P 500 stocks, and the last two names are also giants Dou. Nasdac composite strengthened 2.5%. Russell 2000 with small capital advanced by 1.8%.

The July crude futures contract rose 1% to $ 110.65 a barrel, above the highest levels during the day. August oil rose 1.4% to $ 109.52.

The yield of the 10-year treasury rose by 7 basis points to 3.31%.


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ETFs

Among the best ETFs, the Innovator IBD 50 ETF (FFTI) won 3.3%, while the Innovator IBD Breakout Opportunities ETF (BOUT) won 2%. The IShares Expanded Tech-Software Sector ETF (IGV) advanced 1.9%. The VanEck Vectors Semiconductor ETF (SMH) was up 2.8%.

The SPDR S&P Metals & Mining ETF (KSME) was up 1.6% and the Global X US Infrastructure Development ETF (PAVE) was up 1.1%. The US Global Jets ETF (JETS) was up 0.8%. The SPDR S&P Homebuilders ETF (KSHB) was up 0.4%. Energi Select SPDR ETF (KSLE) recovered 4%, with KSOM shares a huge component, and Financial Select SPDR ETF (KSLF) rose 1.5%. The SPDR Health Care Fund (KSLV) fund grew 2.3%, with UNH shares at the top and Eli Lilly also a notable component.

Reflecting more speculative stories, the ARK Innovation ETF (ARKK) grew by 4.4% and the ARK Genomics ETF (ARKG) by 3%. Tesla shares remain the main holding company in Ark Invest ETFs.


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LNG Stock

Shares of Cheniere Energi rose 5.5% to 132.95, approaching its 50-day moving average. On Friday, shares of LNG cut several months of trading, but then rose sharply. The LNG game is working on consolidation with a buying point of 150.10, although there may be early entries. Several other LNG games have also returned to their 50-day line.

KSOM Stock

Shares of Eccon rose 6.3% to 91.51, regaining its 50-day moving average and probably still valid buying point of 89.90 cups with lunch. KSOM shares reached 105.57 on June 8, but soon gave up on recent gains, falling 14% last week.

Ideally, Eccon Mobil would move sideways and begin to form a new consolidation before making much progress.

On Tuesday, Ekkon Mobil joined the Qatari natural gas project worth 29 billion dollars. Other partners include ConocoPhillips (COP), Eni (E) i TotalEnergies (TTE). Meanwhile, Credit Suisse raised its rating by shares of Ekkon to surpassing the target price of $ 125.

LLI Stock

Shares of Eli Lilli rose 2.2% to 297.35, closing hair below the 50-day line. The previous 314.10 purchase point from flat base / base base is no longer valid. LLI shares are working on a new consolidation. Breaking above the short downward trend line would offer an entry of around 306.

Bristol Myers Squibb (BMI), Vertek Pharmaceuticals (VRTKS) i Harmoni Biosciences (HRMI) show positive actions.

Li Auto Stock

Shares of LI jumped to 7.85 on Wednesday at 35.75, the highest closing since January 2021. Shares of Li Auto nearly broke through a buying point of 37.55 from a 55% deep consolidation. Ideally, LI stocks would form a lever, the longer the better, brewing their huge recent gains.

China’s Li Auto unveiled the L9, a new hybrid SUV, on Tuesday. It is more expensive than Li One, which is already in the premium segment.

Nio (NIO) increased by 9.2% and Xpeng (KSPEV) 6.8%, as both continue to jump above their 50-day line, but below their 200-day averages. EV and giant battery BID (BIDDF) gained 3.2% at 38.60, working at 39.81 buying points on the weekly chart.

Tesla’s shares jumped 9.35% to 711.11, just regaining its 21-day moving average on a large scale. But the 50- and 200-day lines are key obstacles. TSLA shares were close to undermining the lowest values ​​at the end of May last week, but they did not.


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Northrop Stock

Shares of NOC rose 4.5% to 463.77, regaining their 21-day and 50-day lines. Shares of Northrop have weakened sharply in the past two weeks, failing to break the glass with the handle. A new consolidation could begin to take shape. A decisive move across the 50-day line could offer early entry.

UnitedHealth Stock

Shares of UNH jumped 6.25% to 480.32, returning above the 200-day moving average. Shares closed around the downward trend line. Any force from this point can offer early entry into UnitedHealth’s stock. However, investors could view 507.35 as a double bottom for buying, which would also push UNH shares above the 50-day line.

General dollar stocks

Shares of DG strengthened 3.5% to 238.97, back above the 50-day line and approached 240.07 buying points, according to MarketSmith analysis. Shares of the General Dollar were probably already usable after clearing the downward trend line on Tuesday. The price level of 240 is in line with the peaks of DG shares in August and January.

Market analysis

The main indices had a strong recovery on Tuesday, although the volume was significantly lower than on Friday.

After falling to its lowest level since the end of 2020 last week, the Dow Jones, S&P 500 and Nasdaq composite indices probably had to decline. All major indices are still below their 10-day moving averages. The 50-day line is a much bigger hurdle, with an average of 200 days and the highest levels of all time far in the distance.

The best percentage gains of the index in history are on bear markets or corrections, so the action from Tuesday was not so significant in itself.

The S&P 500 and Nasdaq are composite on the second day of the stock market recovery attempt, while the Dow Jones is only on the first day.

If the rally attempt continues, investors could ask for a day to resume later this week to confirm the new growth trend. But this bear market has seen several confirmed market gatherings that have disappeared immediately or within a few weeks.

There are not many stocks that are in a position with such a difficult market sale in 2022.

Energy supplies have recovered after huge losses last week. Some names like Ekkon Mobil and LNG stocks look interesting.

Chinese EV names have been leading in recent weeks, but Li Auto could probably take advantage of the extended break.

In the end, the stock market can fight the Fed, which is raising rates aggressively and with high risks of recession. That is unlikely to change until inflation shows a significant drop, which is likely to take several months at best.


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What to do now

An attempt at market aggregation is trying to make a move, but it has yet to provide evidence that it has power. Even if there is a day to resume soon, investors should be wary of re-entering the market, gradually increasing exposure and declining rapidly.

If this attempt to gather turns into a permanent upward trend that lasts for weeks, months or years, there will be many opportunities for large investments.

Right now, make your watch lists for stocks with strong relative strength, especially for those that hold or regain key moving averages.

Read the Big Picture every day to stay in line with market direction and leading stocks and sectors.

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

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