Dow Jones futures tilted higher Tuesday night, along with S&P 500 futures and Nasdaq futures. The stock market rally was mixed, though Apple stock, Tesla (TSLA) and some other big-cap leaders fared well. Software and industrial names retreated. Bitcoin and other cryptocurrencies tumbled, though they and Bitcoin-related stocks such as Coinbase (COIN) pared losses somewhat.
Investors will get Tesla China sales data for August before Wednesday’s open, part of industrywide reports of Chinese auto sales overall and electric vehicles.
Coupa easily beat EPS views and guided higher. Smartsheet also topped while guiding fiscal 2022 EPS in line. UiPath topped views and offered in-line to slightly higher guidance. COUP stock initially surged more than 10% overnight, but pared gains to 6%. SMAR stock, slightly extended from a buy zone, fell 3% in extended trade. PATH stock tumbled 7.5%, near post-IPO lows.
Meanwhile, Bumble (BMBL) fell 4% overnight. The dating app where women choose the matches will offer 15 million shares on behalf of existing holders. BMBL stock, which came public in February, hit 60.87 intraday Tuesday, briefly clearing a 60.44 bottoming base buy point. But shares reversed to close down 3.6% to 57.77.
Global-e Online (GLBE) will sell 12 million shares on behalf of existing holders. GLBE stock, another 2021 IPO, fell 2% in extended action. Shares have been on a big run, but have pulled back over the last several sessions.
Apple Stock Leads Big Techs
Apple (AAPL) rose 1.55% to 156.69, hitting a new high. The Dow Jones tech titan said it will hold a product launch event on Sept. 14, with new versions of the iPhone and Apple Watch expected to be unveiled. Meanwhile, Ford (F) hired Doug Field, who had been in charge of the secretive Apple Car project. Field previously was a top Tesla executive and decades ago worked at Ford.
Apple stock is still above a 150.10 buy point, within the 5% chase zone that goes to 157.61, but it’s starting to feel a little extended. On the plus side, the relative strength line for AAPL stock hit a seven-month high. The RS line, the blue line in the charts provided, track a stock’s performance vs. the S&P 500 index.
Amazon.com (AMZN) rose 0.9% to 3,509.29, rebounding from its 50-day and breaking a trend line, both offering early buy signals. The official buy point is 3,773.18 in an eight-week consolidation, but AMZN stock has been moving sideways for at least a year.
PayPal (PYPL) advanced 1.4% to 293.26. PYPL stock rose from its 50-day line and cleared a downward-sloping trend line, offering an early entry. PayPal stock has an official flat-base buy point of 310.26.
Tesla stock rallied 2.6% to 752.92 on Tuesday, still in range from a 730 aggressive entry. The RS line for TSLA stock, though still well off all-time levels, is at a four-month best.
Tesla China Sales
Tesla China sales for August will include local deliveries and exports, mostly to Europe. That makes it hard to gauge Tesla’s actual demand in China, especially on a month-to-month basis. In September, all or nearly all of Tesla Shanghai production will be for local markets.
Tesla rivals Nio, Li Auto, Xpeng (XPEV) and local giant BYD (BYDDF) have all reported August sales. All four reported hefty increases vs. a year earlier, but Xpeng and Nio reported declining sales vs. July. Li Auto and especially BYD reported sizeable sequential gains.
Bitcoin plunged 10% vs. 24 hours earlier to $47,260. After nearly hitting $53,000 on Monday, the highest in months, the Bitcoin price plunged as low as $42,921.27 before rebounding somewhat. El Salvador, as promised months ago, now deems Bitcoin as legal tender. The Latin American country also bought some Bitcoin. This could have been a case of “sell the news.”
Ethereum, Dogecoin and other alt-coins also sold off hard.
Marathon Digital (MARA) lost 9.3%, Riot Blockchain (RIOT) gave up 6.7%. Grayscale Bitcoin Trust (GBTC) skidded 7.2% and Grayscale Ethereum Trust (ETHE) tumbled 13.5%. COIN stock fell 4.2%. Coinbase reported some trading delays during the Tuesday’s morning plunge.
The video embedded in this article reviewed Tuesday’s market action and analyzed Apple stock, PayPal and DocuSign (DOCU).
Dow Jones Futures Today
Dow Jones futures rose 0.1% vs. fair value. S&P 500 futures climbed 0.1% and Nasdaq 100 futures advanced 0.1%.
Stock Market Rally
The stock market rally had a mixed session, but weighted to the downside.
The Dow Jones Industrial Average fell 0.8% in Tuesday’s stock market trading. The S&P 500 index dipped 0.3%. The Nasdaq composite edged up 0.1%. The small-cap Russell 2000 declined 0.7%.
The 10-year Treasury yield jumped 5 basis points to 1.37%. Crude oil and copper prices fell modestly.
While Apple, Tesla, Amazon, Netflix and Facebook stock provided some support, most stocks gave up ground.
On the downside, software leaders such as DocuSign and CrowdStrike (CRWD) retreated. DOCU stock fell 6%, more than wiping out Friday’s bullish 5.3% move after earnings. CRWD stock slipped 2.9% after pulling back from record highs after its earnings.
Top Exchange Traded Funds
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) dipped 0.1% after surging 11.7% over the prior two weeks. The Innovator IBD Breakout Opportunities ETF (BOUT) slumped 1%. The iShares Expanded Tech-Software Sector ETF (IGV) retreated 1.1%. The VanEck Vectors Semiconductor ETF (SMH) edged down 0.2%.
SPDR S&P Metals & Mining ETF (XME) rose 0.2% and Global X U.S. Infrastructure Development ETF (PAVE) sank 1.3%. U.S. Global Jets ETF (JETS) ascended 0.3%. SPDR S&P Homebuilders ETF (XHB) fell 1.6%. The Energy Select SPDR ETF (XLE) pulled back 0.6%. The Financial Select SPDR ETF (XLF) also declined 0.6%, even with Treasury yields rising.
Reflecting more-speculative story stocks, ARK Innovation ETF (ARKK) dipped 0.3% and ARK Genomics ETF (ARKG) fell 1.6%. Tesla stock is the No. 1 holding across ARK Invest ETFs. COIN stock and PATH stock also have become notable ARK holdings.
Market Rally Analysis
The stock market rally had a mixed session. The Nasdaq hit a fresh high, while the S&P 500 is just below all-time levels. The Dow Jones fell to just above its 50-day line, but isn’t far from new highs either.
The small-cap Russell 2000 dipped but is pausing after comfortably clearing its 50-day line in recent days. Overall breadth has still improved in the market rally over the past couple of weeks.
Big techs are doing well. Tesla stock headlines an uptrend in EV plays, which also include China’s BYD and Xpeng, as well as various battery and lithium plays. Shipping stocks are doing well. Some hot IPO stocks have kept running.
But market leadership remains relatively narrow. Some software names are giving headfakes and have been over the past couple of months. Industrials are slumping. Retail and apparel names are looking weaker. Housing stocks aren’t broken, but they aren’t working either. Financials are holding their own, but not moving a lot in the past several sessions. Energy stocks are pulling back after some bullish moves.
What To Do Now
The stock market rally remains healthy. Some early buying opportunities, such as BYD, PayPal and Amazon stock, cropped up on Tuesday.
If you’ve got some big recent winners, especially from the clutch of IPOs sprinting higher, you might consider taking partial profits if they become significantly extended from short-term moving averages.
But selling winning stocks, especially on the way up, is definitely an art. Taking partial profits can be smart portfolio management, locking in some gains and freeing up capital for new buys. But if you have true conviction in a company or stock, you might look for ways to carefully add to a position along the way. That can deliver knockout winners that make a year.
Ultimately, you have to adopt sell rules that work for you.
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