Commodity Stocks Buffer Market’s Slide As Apple Approaches This New Buy Point

The major indexes suffered sharp losses in early-morning trading Thursday as Tesla (TSLA) led a drop among automakers and wood products firms paced the downside. But commodity stocks, including steel, concrete, coal and gold mining, bucked the decline.


Meanwhile, Apple (AAPL) acted stingy in giving back a tiny portion of Wednesday’s strong gain, a good sign for the bulls. The megacap tech is still standing tall after an excellent breakout back on Jan. 6, 2017. The stock is trading near all-time highs and is forming a potential new base.

Earlier this week the iPhone giant reported a 30% jump in fiscal second-quarter earnings to $2.73 a share, the biggest jump in 10 quarters, as revenue grew 16%, marking a sixth quarter in a row of top-line acceleration.

At around 10:15 a.m. ET, the Nasdaq sank nearly 0.9%. The Dow Jones industrial average and the S&P 500 lost around 1%. Volume is running sharply higher on the Nasdaq vs. the same time Wednesday and lower on the NYSE.

Tesla gapped down 6% to 282.90 in huge volume after reporting a loss of $3.35 a share. Sales grew 26% to $3.41 billion, the smallest gain in eight quarters. The stock had made a run toward its falling 50-day moving average on Wednesday but then retreated ahead of Q1 results issued after the close.

Going back to Apple, the stock is possibly forming the right side of a shallow double-bottom base. The middle peak between the two lows of the base is 178.94. Hence, a new buy point would be 179.04, 10 cents above that middle peak.

The new base began after Apple hit an all-time peak of 183.50 on March 13.

The Street expects Apple’s earnings turnaround to keep shining bright.

Analysts surveyed by Thomson Reuters expect profit to climb 30% in the June-ending fiscal third quarter to $2.17 a share.

Elsewhere, oil and gas stocks advanced smartly as the rally in crude oil futures show no signs of abating.

Marathon Oil (MRO) rallied more than 5% to 19.37, surpassing an 18.76 buy point in a 13-week cup with handle. The 5% buy zone extends up to 19.70.

The integrated oil and gas firm posted earnings of 18 cents a share in Q1, reversing a 13-cent net loss in the year-ago quarter. Sales boomed 62% to $1.73 billion.


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Originally posted 2019-09-19 23:13:50.


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