Dow Jones futures rose slightly at the end of Thursday, along with the S&P 500 and Nasdaq futures. The stock market rebound had a wild session on Thursday, with key indices further reducing support levels, before recovering and closing higher.
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The Federal Reserve said that large financial companies, such as JPMorgan Chase (JPM) and Bank of America (BAC) may initiate repurchases and dividend increases on June 30, assuming they pass the last round of stress tests. Previously, the Fed had said that higher returns to shareholders could start in the first quarter. But JPM and BofA’s shares were a little higher.
Investors should look for stocks that are holding up well in the current market, with solid fundamentals or, at least, solid profit prospects. This stock market boom is as much fun as a lumbar puncture, so here are 11 stocks for your watch lists: ASML (ASML), General Motors (GM), the Facebook (FB), Scotts Miracle-Gro (SMG), Ubiquiti (UI), Disney (DIS), Target (TGT), Lowe’s (LOW), mosaic (MOS), Deere (DE) and ArcelorMittal (MT).
GM’s stock and ArcelorMittal are on the IBD Leaderboard. Deere, ASML and Scotts-Miracle-Gro shares are on the IBD 50. ASML shares are on the IBD Long-Term Leaders watch list. Deere’s shares are in the IBD Big Cap 20. Lowe’s shares were the IBD shares of the day.
Dow Jones Futures Today
Dow Jones futures were up 0.1% against fair value. S&P 500 futures advanced 0.2% and Nasdaq 100 futures rose 0.25%.
Keep in mind that overnight action on Dow futures and elsewhere does not necessarily translate into real trading in the next regular stock market session.
Join IBD experts as they analyze actionable stocks at the stock market’s high on IBD Live.
Coronavirus News
Coronavirus cases worldwide reached 126.04 million. Deaths from Covid-19 reached 2.76 million.
Coronavirus cases in the US reached 30.77 million, with deaths above 559,000.
Stock market rally
The stock market rebound had a wild session, dropping sharply during the day before rebounding higher.
The Dow Jones Industrial Average rose 0.6% in Thursday’s stock market trading. The S&P 500 index rose 0.5%. The Nasdaq compound rose 0.1%. On the same day, the Nasdaq plunged 1.35% after skidding 2% on Wednesday. The Russell 2000, on an intraday low, jumped 2.2%
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) was up 1.3% and the Innovator IBD Breakout Opportunities ETF (BOUT) was up 0.65% after two major losses for growth ETFs. The iShares Expanded Tech-Software Sector (IGV) ETF fell 0.4%. VanEck Vectors Semiconductor ETF (SMH) was up 0.3%. SMH includes ASML stock and many other chip-gear manufacturers that have held up relatively well.
SPDR S&P Metals & Mining ETF (XME) burst 2.2% and Global X US Infrastructure Development ETF (PAVE) 2.1%. US Global Jets’ ETF (JETS) rose 2.5% after several losses.
Reflecting more speculative story actions, ARK Innovation ETF (ARKK) fell 0.3% and ARK Genomics ETF (ARKG) rose 0.3%.
Stock of the day in the shopping zone with the renewal boom
Facebook, ASML and GM actions are actions to watch out for
So, why consider ASML, GM, Facebook, SMG, Ubiquiti, Disney, Target, Lowe’s, Mosaic, Deere and ArcelorMittal stocks for your watch list? They are doing reasonably well, with strong lines of relative strength or at least improving. Many are showing increasing profits with solid growth prospects ahead.
The shares of Ubiquiti and SMG are forming bases of good looks, especially impressive given the unstable market conditions. Some of these shares are technically in purchase zones, including shares in ArcelorMittal, Lowe’s and Disney. Some others can be seen as “actionable” in a better market, such as Facebook, GM or ASML stocks. But it is not a good market. The recent disruptions continue to struggle or collapse, while the former growth leaders are returning to the lows of March or more.
But all of them are worth watching and offer a window into a variety of positive sectors. It is unclear which stocks or sectors will lead to the next strong rise in the stock market, so you want to launch a broad network. Definitely consider many rivals and peers for the 11 stocks above, as well as from other sectors. Home builders, oil producers and finance companies – including shares of JPMorgan and BAC – are also worth a look.
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Market Rally Analysis
The stock market rebound shifted to a “bullish trend under pressure” on Wednesday and Thursday’s volatile stock did not change that. The next day, the Dow Jones reduced its 21-day exponential moving average, while the S&P 500 fell below its 50-day average and Russell 2000 almost reduced its March lows. It is positive that they have recovered to move higher with sharp intraday losses, with the S&P 500 returning above its 21-day line.
At least market conditions have not worsened. But they are not materially better.
The Nasdaq compound has some work to do to stay above its 21-day line. The high-tech index will not look really healthy until it is again above its 50-day line and its short-term high on March 16. The Dow Jones and the S&P 500 need to maintain important levels.
Most importantly, the recent leaks have not worked. Many stock charts look damaged and need weeks, perhaps months, to be repaired. Of course, it is good that MT’s shares were held in a buying zone on Thursday, but many stocks resisted the sale until they didn’t.
If you have some pilot positions or long-term winners, that’s fine. But investors must be largely in cash and should not be thinking about new purchases.
Perhaps Thursday’s intraday casualties will usher in a bold new era. But that could be a brief truce before major indices fall below recent lows. If a new stock market recovery has legs, there will be plenty of opportunities to take action.
As IBD founder Bill O’Neil said, all stocks are bad unless they go up. There haven’t been many good deeds lately.
Read The Big Picture every day to stay in sync with the direction of the market and leading stocks and sectors.
Follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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