Stock futures rose Sunday evening. On Sunday, a U.S. Boeing (BA) F/A-18E Super Hornet shot down a Syrian government bomber, a day ahead of the Paris Air Show. Meanwhile, Apple (AAPL) starts the week under heavy pressure even as Facebook, Amazon (AMZN) and Alphabet (GOOGL) find key support. Markets are still digesting Amazon’s $13.7 billion deal to buy Whole Foods Market (WFM), which may yet get a rival bid.
Boeing and Apple are both members of the Dow Jones industrial average. Boeing is now the top-performing Dow stock in 2017, up 26%. Apple has fallen to third, up 23%, with McDonald’s (MCD) now second.
Futures for the Dow Jones industrial average rose 0.2% above fair value. S&P 500 index futures climbed 0.3% and Nasdaq 100 futures advanced 0.4%.
XAutoplay: On | Off On Sunday, the Pentagon said Sunday that a U.S.-flown Boeing F/A-18E brought down a Syrian regime SU-22 bomber jet that was attacking anti-regime, American-allied fighters. It’s the first time the U.S. has shot down a Syrian jet during its civil war.
That comes a day ahead of the start of the Paris Air Show, where Boeing, Lockheed Martin (LMT) and other makers of civilian and military aircraft will show off their wares and announce big orders. Lockheed Martin’s F-35 stealth fighter is expected to display high-G maneuvers and fancy flying to wow that crowd.
IBD’S TAKE: For more chart analysis of Facebook, Amazon and Google parent Alphabet, check out IBD’s latest Stocks To Watch column.
It’s an important time for defense spending. European leaders are stepping up defense spending amid pressure from President Trump to live up to NATO commitments. Meanwhile, Trump has hinted at giving a new contract for more F/A-18 fighters, which are cheaper than the cutting-edge F-35.
Boeing’s Paris Air Show is likely to focus on orders for its new 737 Max 10 stretch passenger jet as well as any buzz about a new, midrange airliner to compete with Airbus (EADSY) and its A321neo jet.
Boeing shares are at record levels, now slightly extended from an 185.81 flat base entry after spending several weeks in buying zone. Lockheed Martin is in buy range from 270 entry initially cleared on March 17 but only decisively cleared a month ago. Raytheon (RTN), General Dynamics (GD) and Northrop Grumman (NOC) are all in buy zones as well.
Apple has now flashed several sell signals over the past several sessions. Apple shares fell 4.5% last week in the heaviest weekly volume in two months and the heaviest weekly volume in a down week in 13 months. Apple is now 9% below its mid-March record high and is starting to lose sight of its 50-day moving average.
Meanwhile, Alphabet, Facebook and Google parent Alphabet have all found support at the 50-day moving average. Amazon, an IBD Leaderboard stock briefly undercut that level on June 9, but has held above that level since then and never closed below that level. Facebook dropped below the 50-day several times over the prior six sessions, but always closed higher. Alphabet tested but never dropped below that key support line.
The rebounds, which generally came on higher volume, offer a chance for follow-on buys or an initial positive. Keep in mind that the uptrend is under pressure, so investors should be cautious about many any purchase.
As for Netflix (NFLX), the fourth member of the “FANG” internet group, that stock is hovering below its 50-day line, though it’s showing a little better action than Apple.
Whole Foods Bidding War
Whole Foods shot up 29% to 42.68 on Friday, above Amazon’s 42-a-share offer. Some investors and analysts see a higher bid as possible, with pure-play grocers Kroger (KR) and private-equity backed Albertsons cited as possible suitors. But Wal-Mart (WMT) and Target (TGT) also suggested. Wal-Mart is the No. 1 grocer seller in the U.S., with Target also a big player.
No doubt many grocery sellers’ top executives and boards were mulling their next moves over the weekend.
Shares of Kroger and other grocery sellers were big losers last week, amid concerns about the impact of an Amazon-Whole Foods deal and Kroger’s big profit warning.
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