Dow Jones futures were in focus late Tuesday, along with S&P 500 futures and Nasdaq 100 futures, after Tuesday’s stock market sell-off. Dow Jones leaders Apple and Microsoft tumbled, while Tesla dove 21%. Nikola soared as much as 53%. Slack plunged 15% on earnings after the close.
The tech-heavy Nasdaq sold off 4.1% Tuesday, extending a losing streak to three sessions. The S&P 500 declined 2.8%, while the Dow Jones Industrial Average lost 2.25%, or 632 points, weighed down by a 5.8% fall in shares of Boeing (BA).
Among stock market leaders, Apple (AAPL) and Microsoft (MSFT) lost 6.7% and 5.4%, respectively. Tesla (TSLA) plunged 21% Tuesday. Meanwhile, Nikola (NKLA) surged as much as 53% on a new partnership with General Motors (GM).
Apple, Microsoft and Tesla are IBD Leaderboard stocks.
Dow Jones Futures
Late Tuesday, the Dow Jones futures haven’t started trading yet. The extended hours session will start at 6 p.m. ET. Remember that overnight action in Dow Jones futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
U.S. Stock Market Today Overview
Last Update: 4:32 PM ET 9/8/2020
Among exchange traded funds, Innovator IBD 50 (FFTY) fell 3.2% Tuesday. The Nasdaq 100-linked Invesco QQQ Trust (QQQ) ETF moved down 4.8% to close at 269.95. Meanwhile, the SPDR S&P 500 ETF (SPY) lost 2.7% to 333.27.
Amid the coronavirus stock market rally, the tech-heavy Nasdaq is up 20.9% for the year through Tuesday’s close. Meanwhile, the S&P 500 is up 3.1%, while the DJIA is down 3.6% year to date, through the Sept. 8 close.
According to the Worldometer data tracker, the cumulative number of confirmed U.S. cases topped 6.5 million on Tuesday. On Sept. 6, daily new cases measured just above 31,000, the smallest increase since June 21.
The cumulative total of Covid-19 cases confirmed since the start of the outbreak worldwide topped 27.6 million Tuesday, with more than 899,000 virus-related deaths.
Coronavirus Stock Market Rally
According to IBD’s The Big Picture, the coronavirus stock market rally is seeing strong selling pressure after rebounding from lows five months ago, on March 23. The major stock indexes confirmed the rebound as a new uptrend on April 2.
After Tuesday’s sell-off, the Nasdaq is more than 10% off its all-time high. The tech-heavy composite closed below its key 50-day support level for the first time since the start of the new uptrend on April 2.
Amid worsening general market conditions, investors should be more focused on locking-in profits and cutting losses short. Another way to reduce risk is to move off margin. Be careful with new buys. The increased risk in the market should give you pause.
Stocks to watch include IBD Long-Term Leaders, companies with stable earnings growth and price performance.
Dow Jones News: Boeing Skids
Among the Dow Jones stocks, Boeing skidded 5.8% on a report that Boeing 787 Dreamliners could face inspections by U.S. aviation regulators over quality control issues.
Boeing was one of the worst-performing Dow 30 stocks Tuesday. Shares are nearly 60% off their 52-week high.
Stocks Near Buy Zones: Netflix, O’Reilly
Netflix is approaching a cup-with-handle’s 557.49 buy point, according to MarketSmith chart analysis. Shares are finding support near their 50-day line amid the current stock market pullback. The stock fell 1.75% Tuesday.
According to the IBD Stock Checkup, Netflix stock shows a best-possible 99 IBD Composite Rating. The Composite Rating is a simple way to easily measure the quality of a stock’s fundamental and technical metrics.
IBD Stock Of The Day O’Reilly Automotive is approaching a 488.05 buy point in a flat base. Shares edged lower Tuesday, handily outperforming the broad market.
Nikola surged as much as 53% after General Motors took an 11% stake in the hot electric-truck maker, while agreeing to build Nikola’s Badger by the end of 2022. The Badger is expected to be unveiled in December. Shares trimmed gains to 40.7% Tuesday.
Nikola stock is still more than 45% off its 52-week high.
Tesla stock dived 21% Tuesday after the S&P Dow Jones Indexes declined to add the electric-auto maker to the S&P 500. The move would have prompted index mutual funds and ETFs to acquire stakes in the stock, potentially boosting the stock price.
Shares hit an all-time high on Sept. 1, topping out at 502.49 before reversing lower. After just five trading sessions, Tesla is more than 30% off its all-time high.
Stock Market Earnings: Lululemon, Slack
Lululemon reported strong quarterly results after the close Tuesday, but shares fell 1% in extended trade. The yoga-inspired athletic gear company earned 74 cents per share on revenue of $903 million. The Street expected EPS to decline 47% to 51 cents on revenue of $833.81 million.
Lululemon stock is still about 8% above a 324.86 buy point in a flat base. Shares triggered the 20%-25% profit-taking rule on Sept. 2, so investors could have taken some profits around that time. Currently, shares are pulling back to their 50-day moving average line.
Slack reported better-than-expected fiscal Q2 results late Tuesday, but billings came in lower than expected. WORK stock plunged 15% after the close. Shares ended Tuesday more than 25% off their 52-week high.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple stock fell 6.7% Tuesday, as the iPhone maker continues its current pullback. Shares are about 18% off their all-time high after setting a record high on Sept. 2 at 137.98.
Apple stock is about 57% above a cup-with-handle’s 72.15 buy point. The blue-chip giant is the No. 1-performing Dow Jones stock in 2020, with a 53.7% advance through Tuesday’s close. It is also an IBD Leaderboard stock idea.
Software leader Microsoft dropped 5.4% Tuesday. Shares closed below their 50-day support level for the first time since the May 5 breakout above a cup-with-handle’s 180.10 buy point.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones futures.
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