Election Results, Inflation Data On Deck; Tesla Hits New Low

Dow Jones futures are higher ahead of Tuesday’s open and US election results. Key inflation data, including the Consumer Price Index, will be released later in the week.


Republicans will almost certainly retake the House in the midterm elections on Tuesday. They seem to have the edge in winning the Senate, though that is less obvious. Democrats currently hold a slim majority in the House, with Vice President Kamala Harris holding a 50-50 vote in the Senate.

Due on Thursday, the Consumer Price Index is expected to increase by 0.7% in October from the previous month. Consumer inflation is expected to increase by 8% year-on-year.

Diamondback Energy (FANG), Lyft (LYFT), Mosaic (MOS) and Shockwave Medical (SWAV) are the main earners as of late Monday.

FANG stock traded partially lower in extended trading, while Lyft stock fell more than 16%. Mosaic stock inched higher. And Shockwave stock lost more than 5%.

Stock market today

On Monday, the Dow Jones Industrial Average rose 1.3%, or more than 400 points, and the S&P 500 gained 1%. The tech-heavy Nasdaq composite index rose 0.85%.

Among exchange-traded funds, Nasdaq 100 tracker Invesco QQQ Trust (QQQ) gained 1.1% and SPDR S&P 500 (SPY) gained 0.9%.

Huge EVs Tesla (TSLA) slipped 5% on Monday. Among Dow Jones stocks, Apple (AAPL) trading increased by 0.4% and Microsoft (MSFT) is up 2.9% in the stock market today.

Among the top stocks to buy and watch, Albemarle (ALB), IBD Charts watchlist repository Arista Networks (NET), CF Industries (CF) and New Fortress Energy (NFE) – as well as the name of the Dow Jones Merck (MRK) and UnitedHealth Group (UNH) – among the top stocks worth buying and worth watching.

Arista Networks is a stock on the IBD Leaderboard watch list. Albemarle was featured in this week’s Stocks Near Buy Area column, along with three other top stock ideas.

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Top 4 growth stocks to buy and watchrent Stock Market Rally

Dow Jones Futures Today: Treasury yields, oil prices

Before Tuesday’s opening bell, Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, were up about 0.1% above fair value. Remember that overnight action in Dow Jones futures and elsewhere does not necessarily translate into actual trading during the next regular stock market session.

The yield on the 10-year Treasury note edged higher to 4.21% on Monday, extending its winning streak to four sessions and closing at its highest since Oct. 24. Meanwhile, US oil prices down nearly 1% as West Texas Intermediate futures trade near $92 a barrel. Last week, WTI futures hit their highest levels since mid-October.

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3rd quarter earnings Season

Q3 earnings season continues this week, with more important reports coming from Disney (DIS), DoubleVerify (DV), DR Horton (DHI), Random (OXY) and Roblox (RBLX).

Earnings reports cause the most volatility for stocks, and they require special focus. High earnings could push top stocks past new buy points and into buy zones, while a less dramatic announcement could send stocks falling below key support levels.

The stock market’s reaction to earnings releases can often tell you more than the earnings themselves. If the results look positive but the stock is still sliding, investors may be concerned about the sustainability of growth, rising costs, or other potential negatives.

With the market in bull mode, investors should watch for companies that beat earnings results favorably and reacted strongly to the upside. These stocks could be among the new leaders if the market can recover from recent losses.

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What to do during a struggling stock market rally

Now is a great time to read the IBD Big Picture column after the stock market trend changed from “confirmed uptrend” to “uptrend under pressure.”

At this point, investors should play defensively; Don’t let profitable trades turn negative. As The Big Picture reiterated last week, you should maintain visibility at or below 20% until the uptrend resumes.

But it’s not the time to step away completely. The uptrend is still intact, so traders can still buy breakouts but should focus on stocks with leading technical and fundamental indicators.

(See Lists of IBD Stocks like the IBD 50 and Stocks Near the Buy Zone, for more stock ideas.)

Five Dow Jones stocks to buy and watch now

Dow Jones Stocks to Watch: Merck, UnitedHealth

Dow Jones and IBD member 50 Merck stock has stayed out of buy range, breaking through the 93.12 buy level of the double bottom. The 5% buy range rises to 97.78.

Healthcare giant UnitedHealth continues to aim for a cup with a 553.23 buy point of the handle, according to IBD MarketSmith, following last week’s breakout attempt. Shares rose 1.3% Monday, closing about 1% below the stock’s latest entry.

Top stocks to buy and watch: Albemarle, Arista, CF, New Fortress

Lithium maker Albemarle is building the right side of the cup base that has a 308.34 buy point. Shares rose 0.5% Monday, extending their winning streak to three sessions.

Stocks on IBD Leaderboard’s watchlist Arista Networks are attempting to break above a 132.97 buy point of a volatile base. Shares fell 0.4% on Monday.

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CF Industries is attempting to find support around its 50-day moving average amid Monday’s 1% loss. Stocks that are building a cup base have a buy point of 119.70, according to the IBD MarketSmith pattern identifier.

New Fortress Energy is rapidly approaching the 63.16 buy point of the cup base. With shares about 6% from new highs, look out for a handle for earlier entry. Energy leaders reported results late Monday, up 1.5% on the day.

Join IBD experts as they analyze the top stocks in the current stock market rally on IBD Live

Tesla shares

Tesla stock fell 5% on Monday, hitting a 52-week low and hitting its lowest since June 2021.

The stock is down more than 50% to its 52-week high and well below the 50 and 200-day moving averages.

Dow Jones Leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares rose 0.4% on Monday despite the company warning it had reduced iPhone 14 production due to Covid-19 restrictions in China. Apple stock ended a five-day losing streak but is still about 24% below its 52-week high.

Microsoft rallied 2.9% on Monday, continuing its recovery from a 52-week low on Friday. The software giant is still down about 35% from its 52-week high.

Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.


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