Dow Jones Futures: FedEx Earnings, Micron Earnings Bad News For These 6 Stocks, Stock Market

Dow Jones futures were little changed late Tuesday, along with S&P 500 futures and Nasdaq futures, despite grim outlooks from bellwethers FedEx (FDX) and Micron Technology (MU) after the close. In Tuesday’s stock market, the major averages eked out modest gains after Monday’s sharp sell-off revived the stock market correction. FedEx earnings guidance hit FedEx stock, but also United Parcel Service (UPS) and (AMZN). Micron earnings guidance hurt Micron stock and chip-equipment giants Applied Materials (AMAT) and Lam Research (LRCX).


Dow Jones Futures Today

Dow Jones futures were 0.1% above fair value. S&P 500 futures were up slightly. Nasdaq 100 futures retreated a fraction. FedEx stock and Micron stock are bellwethers for their sectors and for the broader global economy.

Remember that overnight action in Dow futures, FedEx stock and elsewhere doesn’t necessarily translate into actual trading in the next regular session.

Stock Market Correction

The stock market correction is back on after Monday’s sell-off sent the Dow Jones, S&P 500 index and Nasdaq composite through recent lows and the S&P 500 index below its February lows. The major averages rallied somewhat in Tuesday’s stock market trading, but the action was not particularly encouraging. A solid intraday rally briefly turned to modest losses amid plunging crude oil futures before the major averages rose slightly at the close.

In any case, Tuesday is just day one of a stock market rally attempt. Wait for one or more of the major averages to stage a follow-through day to confirm a new uptrend. Even then, investors should be cautious and look for further confirmation. The stock market staged follow-through days in early November and early December, only to head lower almost immediately.

The two-day Fed meeting ends Wednesday, providing a possible stock market catalyst up or down. Markets expect a Fed rate hike, but it’s not a sure thing. Policymakers also are likely to signal fewer Fed rate hikes in 2019.

FedEx Earnings Guidance Hit FedEx, UPS, Amazon Stock

FedEx earnings came in at $4.03 a share, up 27% vs. a year earlier. That slightly missed estimates, according to Zacks Investment Research, but modestly topped other consensus forecasts. Revenue topped views. But FedEx earnings guidance was well below its prior targets, warning of overseas weakness, citing China and “especially in Europe.”

FedEx stock fell 6% in late trade. Shares had rallied 1.55% to 185.01 in Tuesday’s stock market, but have plunged 19% in December amid concerns of slowing economic growth and growing competition from key customer Amazon.

UPS stock lost 3.5%. Amazon stock retreated 0.4%.

Micron Earnings Report Hurts Micron Stock, Chip Equipment Makers

Micron earnings narrowly beat for the fiscal first quarter while missing on revenue. The memory-chip giant sees weakness in DRAM and NAND. Micron gave weak Q2 earnings and sales guidance and cut production and capital spending plans for 2019.

Micron stock tumbled 9.1% late. Shares rose 0.7% on Tuesday, but they hit a 52-week low Monday.

Micron capital spending plans aren’t good news for chip-equipment suppliers with heavy exposure to the memory market. Applied Materials stock fell 2.6% late. Lam Research stock lost 3.9%.

The Micron earnings report could undermine a barely perceptible chip-sector rally. Unlike the Dow Jones or Nasdaq, the long-lagging Philly Semiconductor Index hasn’t undercut its late-October lows. Instead, the Philly Sox has risen slightly — amid volatile swings — with higher highs and higher lows.


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Originally posted 2019-09-19 23:28:30.


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