Investors awaited this week's inflation updates. The Dow Jones Industrial Average climbed 160 points on Monday. The second quarter earnings season begins Friday with reports from major banks JPMorgan Chase, Citigroup, and Wells Fargo.
This week's economic data is plentiful, but the focus will be on Wednesday's Consumer Price Index data. Economists expect a 0.3% increase in the core CPI (which excludes food and energy) and overall CPI. Core CPI inflation could fall from 5.3% in May to 5%, or even lower, as the 0.6% increase per month in June 2022 is not included in the 12-month calculation.
Stock Market Today
Tesla, the electric-vehicle company, has dropped more than 2% in value on Monday morning. Apple (AAPL), Microsoft (MSFT), and other Dow Jones tech giants were down sharply after the stock market opened today.
Alphabet (GOOGL), Meta Platforms (META) and other stock market leaders are Alphabet. GOOGL shares fell 2.1% in early trading, while Meta shares rose 0.5%.
Alphabet, Chipotle Mexican Grill CMG, Dynatrace DT MongoDB MDB and Nvidia NVDA -- as well Dow Jones stocks American Express AXP Visa V and Salesforce CRM (CRM) are among the best stock to watch during the current stock market decline.
Tesla was on the IBD Leaderboard last week, but Nvidia wasn't. Alphabet, Dynatrace and others were recently IBD Stocks of the Day.
Dow Jones Today - Oil Prices and Treasury Yields
The Dow Jones Industrial Average grew 0.45% after Monday's opening, while the S&P500 also gained a little. In morning trading, the tech-heavy Nasdaq Composite fell 0.3%.
The Nasdaq-100 tracker Invesco QQQ Trust, (QQQ), was down by 0.4% early Monday, while SPDR S&P500 ETF, (SPY), rose by 0.1%.
The yield on the 10-year U.S. Treasury note fell to 4.04% as it continued to hold above recent highs. The yield reached a high of 4.05% on Friday, its highest since early March.
After last week's strong recovery from lows, oil prices dipped modestly on Monday morning. West Texas Intermediate futures fell around 0.5% to a little below $73.50 per barrel.
Stock Market Action
The Nasdaq Composite saw its gains disappear on Friday as it fell 0.1%. This meant that it ended the week with a loss of almost 1%. S&P 500 saw its gains disappear as well, falling 0.3%. The benchmark index dropped just over 1% in a week, and is now at the 10-day average. It is still up by nearly 15% in 2023.
Dow Jones Industrial Average dropped the most among major indices on Friday, falling 0.6%. The 50-day moving is now likely to be tested.
The Big Picture column on Friday stated, "It wasn't all bad news though." On the NYSE, the number of advancers was more than 2 to 1 and on the Nasdaq it was about 2-to-1. Both indexes had lower volumes, which was a positive sign on a day of decline. "At this stage, stock market upward trend continues to be resilient."
Dow Jones Stocks to Watch: American Express Salesforce Visa
American Express is building an American Express cup with handle base. The buy point for this base is 177.04. After a 0.7% decline on Friday, shares are now 4% from the entry level. AXP shares rose 0.3% on Monday morning.
Salesforce is trying its best to recover from the slump that followed its earnings. The company is testing the support of the 50-day line, and a strong rebound could create a buying opportunity. According to IBD Leaderboard's analysis, there is also a possibility of a flat basis with a buy point of 225. CRM stock fell a fraction Monday morning.
Visa, the world's largest payments company, closed Friday just above the 235.57 purchase point of a flat-base with a loss of 1%. The top of the buy range is 247.35. V shares rose 0.6% on Monday morning.
Best Stocks To Buy And Watch: Alphabet, Chipotle, Dynatrace, MongoDB, Nvidia
Alphabet is Wednesday's IBD stock of the day. It is currently trying to find some support near its 50-day line. Investors could have bought at the high of 121.08 on June 30, last week. After two days of losses, shares are now below the buy trigger. Alphabet's shares are flat with a buy point of 129.04, and they have a flat basis. GOOGL shares fell more than 1% on Monday morning.
According to IBD MarketSmith's pattern recognition, Chipotle stock on the IBD Leaderboard continues to drop below a base buy point of 2,139.88. A trendline also allowed for an early entry of 2,092.51 due to the flat base. Chipotle has been featured as a recent IBD Stock Of The Day. CMG's stock price was higher on Monday morning.
The chart of software maker Dynatrace shows a tight pattern that has lasted three weeks. This is a short consolidation during which institutional investors have paused their purchases. Shares are 3% off their 52.99 entry. DT stock fell 0.3% on Monday morning.
MongoDB's recent earnings-driven jump offered a new entry. The shares are below the tight formation of three weeks that indicated a buying point at 398.89 following three consecutive days of losses. Investors who are more aggressive could have entered the market at 386 using a trendline. MDB's stock fell 0.5% on Monday morning.
Nvidia's shares have trended consistently higher since their earnings-driven gap-up on May 25. The stock has been on a downward trend since June 20. This is a good time to buy. The stock formed a trendline at 418, after finding support at its 21 day exponential moving average. Nvidia is a stock on the IBD Leaderboard
Roku (ROKU 75.45 cup with handle)
Source: IBD data as of July 5, 2023
IBD Leaderboard's Tesla stock declined for the second session in a row on Friday, falling 0.8%. Tesla shares finished the week 4.8% higher, but they are still well out of the buy range, having risen beyond the 207.79 point at which the double bottom buy point is located. They are also just a few cents off their 2023 peak.
TSLA's stock fell more than 1% on Monday, adding to the losses of Friday.
Dow Jones Leaders - Apple and Microsoft
Apple's stock, among Dow Jones stocks continued to hold at just below last week’s record high of 194.48, dropping 0.6% on Friday. The shares continue to hold strongly above the 157.38 buying point. In early morning trading on Monday, the shares dropped 1.5%.
Microsoft shares fell 1.2% on Friday, ending their two-day winning streak. The stock is about 4% off its all-time high of 351.47, set on June 16. Investors can still take some profit from the stock, which is still within a 20% to 25% profit range when compared to a flat-base purchase point of 276.76. Microsoft's shares fell 2.1% on Monday morning.