Dow Jones futures were little changed late Tuesday, along with S&P 500 futures and Nasdaq futures. The coronavirus stock market rally had solid gains, with the S&P 500 and Nasdaq hitting a record high, even with Apple (AAPL) and Tesla stock taking a breather.
Salesforce.com (CRM), which is joining the Dow Jones Industrial Average, reported earnings late Tuesday. So did Autodesk (ADSK), Intuit (INTU) and Toll Brothers (TOL). Meanwhile, Xpeng Motors (XPEV) is set to price its IPO, the latest China electric-vehicle rival to Tesla (TSLA) going public in the U.S.
The stock market rally had a bullish session, with techs leading the way. Even better, the Nasdaq rallied, with Apple stock falling slightly and Tesla lagging slightly. The tech-heavy index has relied heavily on those two tech giants in the past few weeks.
Salesforce stock rallied in extended trade after popping to a record high on the DJIA news. Autodesk retreated after just closing in a buy zone Monday. Intuit jumped overnight, extending a recent breakout. Toll Brothers rose modestly as the luxury builder has been moving toward highs from a very deep base.
Xpeng Motors will offer 85 million American depositary shares priced at $11-$13. The just-launched Xpeng P7 is a Tesla Model 3 rival, on paper offering greater range for a lower price.
Xpeng will begin trading Thursday. The Alibaba (BABA)-backed startup will join Nio (NIO) and Li Auto (LI) as Chinese EV Tesla rivals listing in the U.S. Nio stock blasted out of a base to a new high on Tuesday, while newly public Li Auto jumped toward an IPO-base buy point.
Separately, data analytics firm Palantir filed to go public via a direct listing.
Dow Jones Futures Today
Dow Jones futures were even vs. fair value. S&P 500 futures edged up 0.1%. Nasdaq 100 futures climbed 0.2%. Remember that overnight action in Dow futures, CRM stock and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
Coronavirus cases worldwide have reached 24.03 million. Covid-19 deaths are above 822,000.
Coronavirus cases in the U.S. are at 5.95 million, with deaths topping 182,000.
Coronavirus Stock Market Rally Tuesday
U.S. Stock Market Today Overview
Last Update: 4:10 PM ET 8/25/2020
The coronavirus stock market rally had a positive session, closing near session highs.
The Dow Jones Industrial Average dipped 0.2% in Tuesday’s stock market trading, as Apple, Boeing (BA) and soon-to-exit DJIA stocks Pfizer (PFE), Exxon Mobil (XOM) and Raytheon Technologies (RTX) retreated. The S&P 500 index rose 0.4% and the Nasdaq composite gained 0.8%, both hitting fresh all-time highs.
Apple stock dipped 0.2%, ending a five-day win streak to a record high and a market cap above $2 trillion. It’s a member of the Dow Jones, S&P 500 index and Nasdaq. Tesla rose 0.45%, turning positive late in the seession.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) climbed 0.5%. The iShares Expanded Tech-Software Sector ETF (IGV) popped 1.1% to all-time levels, with CRM stock a notable holding along with Microsoft and Adobe. The VanEck Vectors Semiconductor ETF (SMH) also climbed 1.1% to record highs.
Salesforce earnings soared 118% to $1.44 a share, or 30% to 86 cents excluding an investment gain. Revenue rose 29% to $5.15 billion. Analysts expected Salesforce earnings of 67 cents on sales of $4.9 billion.
The cloud-computing pioneer raised full-year revenue targets.
Salesforce stock spiked 12.5% in extended trade. Shares rose 3.6% Tuesday to 216.05, hitting a record high on its looming Dow Jones entry.
CRM stock will join the Dow Jones Industrial Average on Aug. 31, the same day as a 4-for-1 Apple stock split. That’s not a coincidence. The DJIA is price-weighted, so the Apple split would have lowered the index’s tech weighting significantly. Salesforce helps fill that gap.
The strong Salesforce earnings and guidance are a good sign for software and IT spending in general.
Autodesk earnings rose 51% to 98 cents a share. Revenue grew 15% to $913.1 million. Analysts expected Autodesk earnings of 90 cents and sales of $899.3 million.
The design software maker guided in line for the full year, but investors may have expected more after the Q2 beat.
Autodesk stock fell nearly 3% to 245 overnight. Shares edged up 0.2% to 252.24 on Tuesday. Autodesk cleared a 251.49 buy point, according to Marketsmith, after topping a 246.46 early entry.
Intuit earnings came in at $1.81 a share vs. a 9-cent loss a year earlier. Revenue jumped 83% to $1.82 billion. Analysts expected Intuit earnings of $1.10 a share on revenue of $1.56 billion.
Traditionally, the fiscal fourth quarter is the weakest for Intuit. But with the tax filing deadline delayed to July 15 from April 15 due to the coronavirus, the Turbo Tax maker’s business shifted from Q3 to Q4.
Intuit stock leapt 6% in extended trade. Shares rose 1% to 336.42 on Tuesday, hitting a new high. Intuit broke out past a 313.55 cup-with-handle buy point last week and is now extended.
Toll Brothers Earnings
Toll Brothers earnings declined 10% to 90 cents a share in the fiscal third quarter, with sales down 7% to $1.65 billion. Analysts expected Toll Brothers earnings of 69 cents on revenue of $1.55 billion.
Home deliveries edged up 1% to 2,022. The luxury homebuilder sees higher deliveries in the current fourth quarter.
Toll Brothers stock rose 2% overnight. Shares nudged up 0.8% to 46.05 on Tuesday. Toll stock cleared a 37.90 buy point in late July from a very deep base. Shares are now moving toward the 52-week high of 49.31 set on Feb. 11.
Stock Market Rally Outlook
The Nasdaq composite is around the middle of a channel for the current stock market rally. The trend is too steep to be sustainable, though that could have been said weeks ago. Meanwhile, on a monthly chart, the Nasdaq is extended from a long-term channel line. The Nasdaq closed 8% above its 50-day line and 4% vs. its shorter-term 21-day line. That’s not extreme but worth keeping an eye on.
Those factors raise the odds of a pullback, and that the pullback could be sharper.
Ideally, the current market rally would pause or move at a more gradual pace. That would likely bring the Nasdaq back within its long-term channel line, while the 50-day moving average could catch up.
However, the stock market is going to do what it’s going to do. Right now leading stocks are performing well. Investors should take advantage of the current bullish trend, but be ready. Have a game plan for your stocks, stay alert and be ready to act.
Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
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