Dow Jones futures tipped higher late on Tuesday along with the S&P 500 futures and Nasdaq futures. The stock market rally took a breather on Tuesday and fell lower after strong gains the last few sessions.
Royal Caribbean (RCL), Carnival (CCL) and Norwegian Cruise Line (NCLH) gathered late on a Bloomberg report that the Centers for Disease Control and Prevention recommended that cruises could resume this summer with certain restrictions. It followed reports indicating that cruise operators do not need vaccination for travelers.
Carnival, NCLH and RCL shares rose 2% overnight, adding gains on Tuesday and over the past several sessions. All three stocks are approaching possible buy points.
Breakouts Hold, new buy signals
Microsoft (MSFT), Facebook (FB) and Google parent Alphabet (GOOGL) continued to hold in buyout range on Tuesday after Monday’s breakouts.
Micron Technology (MU), Square (SQ), Sea Limited (I KNOW), Chipotle Mexican grill (CMG) and Yeti Holdings (YETI) all buy signals flashed, at least intraday.
Tesla (TSLA) hits resistance after a recent run. But Tesla shares and other highly-valued growth names are showing signs of life.
Microsoft and Google shares are listed on the IBD Leaderboard. The GOOGL stock is on SwingTrader. Microsoft stock is on IBD Long-Term Leaders. The Yeti stock is on the IBD 50 list. Google and Micron shares are at Big Cap 20.
Dow Jones Futures today
Dow Jones futures rose a fraction of their fair value. S&P 500 futures rose higher. Nasdaq 100 futures rose 0.1%.
Keep in mind that overnight trading in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular trading session.
Join IBD experts as they analyze action stocks at the stock market rally on IBD Live.
News about coronavirus
Coronavirus cases worldwide reached 132.97 million. Covid-19 deaths topped 2.88 million.
Coronavirus cases in the United States have hit 31.55 million with deaths over 570,000.
California plans to lift most coronavirus restrictions by June 15, but maintains its mask mandate.
Stock market rally
The stock market rally had a slightly down session that did not change the bullish trend.
Dow Jones Industrial Average dipped 0.3% in Tuesday’s stock market trading. The S&P 500 index lost 0.1%. The Nasdaq composite fell less than 0.1%.
The 10-year government return fell 6 basis points to 1.66%.
Read the big picture every day to be in sync with the market direction and leading stocks and sectors.
Tech Titans hold up
Microsoft stock dipped 0.5% to 247.86. On Monday, MSFT shares rose 2.8% to 249.07, clearing a 246.23 buy with a flat base, according to MarketSmith analysis.
Google stock fell 0.4% to 2,209.26. The GOOGL stock on Monday popped 4.2% to 2218.96 and also cleared a flat base with a 2145.24 record. Both Microsoft and Google stock flashed early records last week.
The Facebook stock retreated 0.9% to 306.26. The FB stock rose 3.4% on Monday to 308.91 above a buy point of 299.81 handles from a six-month consolidation.
Tesla shares rose 0.1% to 691.92. On Monday, the TSLA share rose 4.4% to 691.05 after record delivery figures. But it was near session low after reaching 708.16 intraday and hitting resistance on its 10-week moving average. The Tesla stock also needs to get over its short-term highs in March and its 50-day line before investors need to pay close attention to the huge 2020 winner.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) rose 0.2%, while the Innovator IBD Breakout Opportunities ETF (BOUT) dipped 0.5%. IShares Expanded Tech-Software Sector ETF (IGV) advanced 0.6%, with the MSFT stock being the top holding. VanEck Vectors Semiconductor ETF (SMH) fell 1.4% after several strong gains.
The SPDR S&P Metals & Mining ETF (XME) withdrew 1% and the Global X US Infrastructure Development ETF (PAVE) lost 0.8%. The US Global Jets ETF (JETS) rose 0.8%.
On the back of more speculative stock holdings, the ARK Innovation ETF (ARKK) rose 1.8% and the ARK Genomics ETF (ARKG) was flat. The Tesla stock is the largest holding across ARK Investments’ ETFs. While the TSLA stock was quiet on Tuesday, it has come back over the last few days, while many other ARK stocks are also going up, including Year (YEAR), Baidu (BIDU) and square stock.
Some of Tuesday’s gains in ARK shares may reflect declining government interest rates. The rising 10-year government return has weighed on highly valued growth stocks over the past few months.
Stocks within purchase range
Yeti stock rose 3% to 75.06, reaching 78.40 intraday. It briefly cleared a buy point of 76.87 handles. YETI closed just off a downhill slope line offering a more aggressive entry. The manufacturer of premium coolers, beverages and now luggage regained its 50-day line last week. The Yeti stock was Tuesday’s IBD stock of the day.
Square stock rose 2.85% to 236.50, regained its 50-day line and broke a downward trend. It could offer an early entry for SQ shares. The official point of purchase is 283.29.
The Micron stock dipped 0.3% to 93.49 after hitting 96.10 within the day, briefly clearing 95.85 entry from a brief consolidation. MU shares have been usable from the 10-week line following the memory ship giant’s earnings and guidance last week. The Micron stock is only 4.7% above its 10-week line.
The SE stock rose 5.2% to 247.03 and resumed its 50-day line. Depending on where you draw it, Sea Ltd. shares have also cleared a downward slope line. This may be an early listing in SE shares, which has an official buy point of 285.10.
Chipotle shares rose 2.4% to 1,487.48 and came back from its 50-day line, breaking a downward trend. It offers an early entry with the official purchase point of 1,565.01. The CMG stock had its best close since February 12, but needs to move a little higher to get over its March peaks. Investors should note that Chipotle earnings are in two weeks.
Analysis of market rally
The stock market rally closed slightly changed on Tuesday after trading in a tight range. After back-to-back S&P 500 gains of more than 1% to record highs and the Nasdaq jumped more than 1.5% in three straight sessions to clear key levels – with a number of strong breakouts – a quiet session is just fine.
A stock market rally break for a few days would provide more handles on the bases, while recent breakouts could consolidate gains. As long as the Nasdaq stays above recent highs and especially the 50-day line, the bullish trend remains intact.
The stock market rally leadership remains broad, with some tech titans, chips, commodities, industrial travel and some retail names doing well.
Some highly valued growth names such as 10X genomics (TXG), Sea Ltd. or Square stock is evolving. Several are like Tesla shares, still below 50-day lines, but at least early repairs are underway. Of course, just as some home improvement projects will not be completed, there is no guarantee that the next chapter for history stores will be happy.
Investors should participate in this market rally. Don’t expect a repeat of the April-September race, but there are reasons to be confident now. As you expand your portfolio and revise your watch lists, try to have diversity within your leading stocks. It helps you avoid large portfolio pulls from group sales, while keeping in line with the market and leading stocks.
Follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
YOU MAY ALSO LIKE:
Why this IBD tool simplifies the search for the biggest stocks
Best growth stocks to buy and see
IBD Digital: Unlock IBD’s leading lists, tools, and analytics today