Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, were higher late Monday following the session’s stock market sell-off. Tech giants Apple, Microsoft, Nvidia, PayPal and Square tumbled, while Tesla stock rallied on strong deliveries Monday.
On Monday, the Dow Jones Industrial Average slid 0.9%. The S&P 500 tumbled 1.3%, while the Nasdaq plunged 2.1% even after paring some losses.
Among the Dow Jones leaders, Apple (AAPL) slid 2.5%, while Microsoft (MSFT) moved down 2.1% in today’s stock market. American Express (AXP) and Merck (MRK) are holding up well in the current stock market correction.
Tesla (TSLA) rallied nearly 1% on the back of strong deliveries, moving further above the stock’s latest buy point. Tech giants Nvidia (NVDA), PayPal (PYPL) and Square (SQ) all sold off sharply.
Among the top stocks to watch, Netflix (NFLX) and ServiceNow (NOW) were holding up relatively well during Monday’s stock market weakness.
Microsoft, ServiceNow and Tesla are IBD Leaderboard stocks. American Express is an IBD SwingTrader stock. Netflix featured in this week’s Stocks Near A Buy Zone column.
Dow Jones Futures Today
After the stock market close Monday, Dow Jones futures rallied less than 0.1% vs. fair value, while S&P 500 futures gained 0.1%. Nasdaq 100 futures rose 0.2% vs. fair value. Remember that trading in Dow Jones futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
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Last Update: 4:34 PM ET 10/4/2021
Among exchange traded funds, Innovator IBD 50 (FFTY) dropped 2.8% Monday. Nasdaq 100 tracker Invesco QQQ Trust (QQQ) lost 2.1%. And the SPDR S&P 500 ETF (SPY) descended 1.3%.
Stock Market Correction
The Nasdaq and S&P 500 tumbled to new recent lows Monday, as the current stock market correction worsened. The Nasdaq closed at its lowest level since June 22 and could be headed for a test of its long-term 200-day moving average. Meanwhile, the Dow Jones Industrial Average almost gave back the entirety of Friday’s 1.4% advance, but held above its recent lows.
Friday’s The Big Picture commented, “With the stock market in a correction, avoid the temptation of buying stocks in a down-trending market. There will always be stocks showing strength, but a weak market can eventually bring everything down with it. If market conditions continue to improve amid renewed signs of institutional buying, new setups should emerge. A confirmation of strength could come as early as next week.”
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Dow Jones Stocks To Watch: American Express, Merck
Dow Jones leaders American Express and Merck are blue chip stocks to watch in today’s stock market action.
IBD SwingTrader stock American Express is approaching a 179.77 buy point in a cup with handle, according to IBD MarketSmith chart analysis. But shares reversed from early gains to decline 0.7% Monday, and are about 4% away from the new entry.
Merck added to Friday’s surge, rallying 2.1% Monday. On Friday, Merck said its Covid pill reduced the risk of hospitalization by half in a final-phase study. Merck stock broke out past a 79.33 buy point in a flat base.
Stocks On The Move: Nvidia, PayPal, Square
Tech giants Nvidia, PayPal and Square sold off sharply Monday.
Nvidia stock dropped 4.85% Monday. On Sept. 20, the stock triggered the round-trip sell signal from a 207.43 buy point in a cup with handle. Investors should sell when a stock gives up the entirety of a double-digit gain to avoid taking a loss. Now, the stock is about 5% below the old buy point.
PayPal slid 3.6%, falling further below its long-term 200-day line. Shares are nearly 20% from their 52-week high.
Square tumbled 5.45%, decisively breaking down below the 200-day moving average. The top payment stock is about 22% below its Aug. 5 all-time high.
Stocks To Watch: Netflix, ServiceNow
FANG stock leader Netflix continues to hold inside a new buy zone despite Monday’s 1.6% bearish reversal. Shares are in the 5% buy zone past a 593.39 entry point in a consolidation amid the recent global success of its series “Squid Game.”
According to IBD Stock Checkup, NFLX stock shows a strong 97 out of a perfect 99 IBD Composite Rating. The IBD Composite Rating identifies stocks with a blend of strong fundamental and technical characteristics.
IBD Leaderboard stock ServiceNow is trying to find support around its key 50-day moving average despite a weak overall market. But shares declined over 2% Monday, closing below that key benchmark.
Bullishly, the stock’s relative strength line hit a recent high in late September, indicating shares are holding up well amid the current stock market volatility. But now the stock is under pressure again. During weak markets, look for stocks that are holding up the best. When the market rebounds, these names can be some of the next top stocks to watch.
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Tesla stock rallied 0.8% Monday after the company reported record third-quarter deliveries on Saturday. The electric-vehicle giant reported deliveries that totaled 241,300 cars for the third quarter, up from 201,250 in the second quarter and 184,800 in the first quarter. FactSet analyst estimates ranged from 218,000 to 246,000, with the consensus at 232,000.
Shares snapped a two-day losing streak Monday and closed further above a 764.55 buy point in a cup with handle.
TSLA shares closed about 13% away from record highs. On Jan. 25, Tesla stock hit a record high of 900.40, after climbing as much as 93% from a 466 buy point in a cup-with-handle pattern.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple moved down 2.5% Monday, giving back all of Friday’s 0.8% gain. The stock is still below the 50-day line.
Software giant Microsoft fell 2.1% Monday, as the stock continues its trade beneath the 50-day line. A new flat base is forming with a 305.94 buy point.
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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