S&P 500 futures were little changed Sunday evening. Facebook (FB), Amazon (AMZN), Netflix (NFLX) and Google-parent Alphabet (GOOGL) remain in buy zones after breaking out over the past month. Meanwhile, Tesla (TSLA) CEO Elon Musk hopes to generate excitement over a Semi truck unveiling this week amid growing concerns about Tesla’s Model 3 “production hell.”
XAutoplay: On | OffWith the market edging lower this week and the S&P 500 index largely going sideways over the past four weeks, it’s not that surprising that the FANG stocks are also holding in a range. Amazon and Alphabet are trading near the high end of their 5% chase zone. Netflix undercut its buy point briefly Friday while Facebook is in the middle.
S&P 500 index futures were virtually flat vs. fair value. Nasdaq 100 and Dow futures rose a fraction.
Tesla
On Sunday, Tesla’s Musk took to Twitter (TWTR) to tout the Semi truck unveiling event Thursday night.
Tesla Semi Truck unveil to be webcast live on Thursday at 8pm! This will blow your mind clear out of your skull and into an alternate dimension. Just need to find my portal gun …
— Elon Musk (@elonmusk) November 12, 2017
The Semi truck is expected to have a battery range that will limit it to relatively short-haul trips. Several other established vehicle makers also are developing electric trucks.
Tesla’s shares have tumbled since hitting a record 389.61 on Sept. 18, breaking below their buy point, 50-day line and 200-day in succession, closing Friday at 302.99. Tesla made just 260 Model 3 cars in Q3, far less than the planned 1,500, with reports pointing to continued slow Model 3 output in October.
China Internets
Looking ahead to Monday, Chinese internet stocks will be in focus. Alibaba (BABA) and JD.com (JD) announced strong 11.11 sales. JD.com (JD) and 58.com (WUBA) also report earnings Monday morning, along with Alibaba-backed Qudian (QD) reporting quarterly results for the first time since coming public last month.
Facebook decisively cleared a 175.59 buy point on Oct. 27 (remember that date). Shares rose as high as 182.90 on Nov. 1, near the upper end of the buy zone. After the close that day, Facebook reported blowout earnings and accelerating revenue growth, but also warned of faster cost increases as it ramps up security in the wake of Russian election meddling. The stock sank about 2% on Nov. 2, and has been trending sideways since, closing Friday at 178.46.
Amazon
Amazon blasted out out of a base with a 1,083.41 entry on Oct. 27, soaring 13% to a record high after reporting strong Q3 results the night before. Amazon tested its buy point a few days later but closed Friday at 1,125.35.
IBD’S TAKE: Amazon and Netflix are both on Leaderboard, IBD’s premium service offering annotated charts of a small number of companies, usually highly rated growth stocks at or near a buy zone. Take a free Leaderboard trial.
Netflix
Netflix was the first of the FANG stocks to break out, clearing a cup-with-handle base buy point of 190.05 on Oct. 5 as the company announced higher subscription rates. Shares continued to climb briefly becoming slightly extended. Shares hit a record 204.38 on Oct. 17 after Netflix reported huge subscriber growth and guidance the night before.
The Hollywood misconduct scandals have hit Netflix. It suspended production of the latest season of “House of Cards” and said that show won’t continue with Kevin Spacey. Netflix said last week that it would not go ahead with another comedy special from Louis C.K.
Walt Disney (DIS) CEO Bob Iger said late Thursday that Disney will launch its streaming service “pretty aggressively” in 2019 that will be priced below Netflix’s rates and boasting old and new “Star Wars,” Pixar and Marvel content. Disney has already said it would pull its movies, including “Star Wars” and Marvel films, from Netflix around that time.
Netflix fell 4% last week, falling as low as 189.50 during Friday’s session, below the buy point and its 50-day line, but closed at at 192.02.
Google-parent Alphabet broke out on Oct. 27, just like Facebook and Amazon. Like Amazon, Google reported strong earnings the night before.
Shares rose 4.3% on Oct. 27, clearing a 1,006.29 buy point. Since then shares have trended slightly higher, poking a couple of times above the 5% chase zone that climbs to 1,056.60. Alphabet dipped 0.3% to 1,044.15 on Friday.
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