2 Tech Stocks Dive, 2 Transportation Names Soar

Tech stocks were under some late pressure in extended trade Tuesday, as futures steered toward a narrowly mixed start on Wednesday.

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Futures for the Dow Jones industrial average dipped 0.2% below fair value in late action. S&P 500 futures showed little change, while Nasdaq 100 futures scratched out a fractional gain.

IBM (IBM), Intuitive Surgical (ISRG), Lam Research (LRCX), railroad CSX (CSX) and United Continental Holdings (UAL) were among the leading names in motion in extended trading.

Tuesday’s session was significant partly because Netflix (NFLX), Goldman Sachs (GS) and UnitedHealth (UNH) posted first-quarter results that all carried elements of upside surprise. But the session also sent more stocks to news highs than any session in the past five weeks. The Dow, Nasdaq and S&P 500 all climbed above their 50-day moving averages. That removed a barrier in the market’s week-old uptrend as the Nasdaq works toward prior highs logged in March.

Netflix and UnitedHealth provided the combustion for Tuesday’s market advance. Netflix surged 9.2%, driving the Nasdaq and the S&P 500. UnitedHealth popped 3.6% to lead the Dow. Both stocks were effectively flat in extended trade Tuesday.

Intuitive Surgical, Lam Research Rise; 2 Tech Stocks Slide

Also after Tuesday’s closing bell, Intuitive Surgical marched ahead 5%.  The maker of the da Vinci robotic surgical system reported a 25% EPS gain and an 18% rise in revenue for its first quarter. The number of surgical systems shipped soared 39%, with procedures performed using the da Vinci system rising 15%.

Intuitive’s shares rose 4.1% in regular trade Tuesday, the stock’s best session since January. Shares are more than two months into a new base, closing Tuesday less than 4% below the potential buy point at 452.10.

Lam Research tumbled 7% in late action, despite a largely positive fiscal third-quarter report. The chip equipment leader’s earnings swept up 71%; revenue jumped 34%. Both were above consensus targets. Q4 guidance also surpassed expectations. Lam is the first chip-sector name to report results during a season in which investors are feeling flighty about chip stocks in general.

Lam shares surged 4.3% in Tuesday’s regular trade. The stock has been consolidating for nearly six weeks.

Transportation issues played well after the close, with CSX up 4.3% and United Continental taking off almost 3% in late trade. Both companies scored Q1 earnings and revenue beats. Both are also in consolidations, but have a long way to go before reaching a valid buy point.

IBM dived more than 5% after Tuesday’s close, despite what appeared to be a stronger-than-expected Q1 report.

Financial And Tech Earnings, Oil Prices In Focus Wednesday

Morgan Stanley (MS), ASML Holding (ASML) and U.S. Bancorp (USB) are among the names scheduled to report results early Wednesday.

Wednesday’s session also offers a simple calendar of economic releases. Homebuilding stocks aren’t likely to see much reaction to weekly mortgage applications data, due out from the Mortgage Bankers Association before the open. Later in the morning, energy stocks and oil prices, now hovering near three-year highs, may respond to weekly oil inventories news from the Energy Information Administration. In the afternoon, the Federal Reserve releases its March Beige Book.

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Originally posted 2019-09-19 23:12:54.

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