The Dow Jones futures, S&P 500 futures, and Nasdaq 100 lots exhibited minimal fluctuations before the market’s opening on Tuesday, as observed during the overnight trading session. The major stock indexes experienced a reversal in their trajectory, deviating from initial substantial declines on Monday. Concerns emerged within Wall Street regarding the potential disruption of the nascent stock market rally due to the ongoing Israel-Hamas conflict.
On Saturday, tensions in the Middle East occurred as Hamas militants initiated a substantial assault on Israel. This assault, which represents the most significant act of aggression in the past five decades, involved the infiltration of forces across the Gaza border and into the southern regions of Israel. In an unexpected turn, Israel promptly declared war against Hamas, executing retaliatory measures across various Palestinian localities.
In the realm of economic data, the upcoming CPI and PPI inflation report and the Federal Reserve minutes from the September policy meeting will be of significant interest to Wall Street.
Additionally, the commencement of the third-quarter earnings season is imminent, wherein the financial performance of prominent entities such as Delta Air Lines (DAL), UnitedHealth (UNH), JPMorgan Chase (JPM), Citigroup (C), and Wells Fargo (WFC) will be unveiled.
Today in the Stock Market: The Dow Jones Is Increasing
Both the Dow Jones Industrial Average and the S&P 500 were able to post gains of 0.6% on Monday. The yield on the technology-focused Nasdaq composite was 0.4%.
Tesla (TSLA) and Nvidia (NVDA) saw their share prices drop on Monday, with Tesla down 0.3% and Nvidia falling 1.1%. The cost of NVDA shares ended the day a little higher over its 50-day mark. Apple (AAPL) and Microsoft (MSFT), two Dow Jones technology symbols, finished solidly ahead in today’s stock market, with AAPL stock increasing 0.85% and Microsoft stock increasing 0.8%.
Along with Dow Jones companies Chevron (CVX) and UnitedHealth (UNH), IBD Ranking member companies Arista Networks (ANET), Duolingo (DUOL), DraftKings (DKNG), and Meta Platforms (META) are among the top stocks to purchase and keep an eye on amid the current rally in the stock market.
Crude Oil Prices and the Yield on the Treasury Market
Before trading on Tuesday, Dow Jones futures and futures for the S&P 500 and Nasdaq 100 futures contracts exhibited minimal fluctuations in their fair value. It is important to remember that the changes observed in Dow Jones futures and other financial markets during overnight trading may not necessarily manifest in corresponding movements during the subsequent typical trading session.
The bond market observed closure on Monday in observance of the Columbus Day holiday. On Friday afternoon, the 10-year United States Treasury yield reached a notable long-term peak, stabilizing at 4.78%.
On Monday, there was a significant increase of over 4% in oil prices, following the substantial losses experienced in the previous week. The West Texas high school futures have surpassed the $86 per barrel threshold.
What to Do in the Wake of the Recent Rally on the Stock Market
The unexpected resurgence observed on Monday, immediately following a follow-through day, holds promising implications for the nascent stock market rally.
Investors can now engage in new acquisitions in light of the current market conditions. Therefore, utilizing meticulously curated watchlists to initiate these transactions is advisable. In the interim, it is advisable to actively seek out potential nascent stock market leadership instances that may manifest in the forthcoming weeks.
One potential approach involves the utilization of the relative strength line. The RS line quantifies a given stock’s relative price performance compared to the S&P 500 index. It is advisable to closely monitor stock charts exhibiting an upward trend in the line, indicating superior performance of the stock compared to the S&P.
The RS line is a ubiquitous feature found in all IBD charts and IBD MarketSmith. Furthermore, the IBD Stock Screener encompasses a comprehensive compilation of stocks assigned top ratings and are currently experiencing upward price movements, as indicated by ascending lines at new peaks. MarketSmith offers a feature known as the “RS Blue Line Dot” list, designed to identify RS lines that have reached new highs.