Stocks Open Lower: Intel Rallies, Cannabis Stocks Turn Mixed

Stocks opened lower, but quickly turned mixed Tuesday as global markets came under pressure, and tech stocks and China-based names were tentative in early trade.


Tesla (TSLA) edged up after third quarter production appeared to meet targets. (AMZN) fell hardest among FANG stocks after announcing it would raise its minimum pay rate to $15. Intel (INTC) climbed to a solid lead among Dow stocks.  Cannabis stocks and the related beverage industry turned volatile, with Tilray (TLRY) down and India Global (IGC) continuing Monday’s steep advance. Edwards Lifesciences (EW) posted an early pullback following an analyst downgrade.

The Dow Jones industrial average opened lower, then battled into narrow gains as Intel advanced 2.9% to the head of the index. The S&P 500 eased 0.1%.

The Nasdaq Composite dropped 0.4%. China names led the losses: NetEase (NTES) tumbled more than 5%.  Baidu (BIDU) slumped 3.4%. (JD) dropped 2% after Stifel Nicolaus cut its price target to 32, from 39.

Cannabis Stocks: India Global Soars, New Age Dives

Among the marijuana industry names, India Global led with a 23% vault. The new entrant to the cannabinoid-infused drink segment swept 40% higher on Monday. The stock had gained 291% in September, and 288% the month before.

Tilray slid 4%. No feasible buy points are in site for either Tilray or India Global.

New Age Beverage (NBEV) dropped 11%. The stock had exploded 66% higher on Monday.

Lamb Weston Surges, Edwards Slides; Pepsico, Tesla Dip

In earnings news, frozen foods packager Lamb Weston Holdings (LW) climbed 4.6% on a solid fiscal first-quarter performance. The stock is looking to break back above its 10-week moving average and start up the right side of a two month consolidation.

Tesla rose a fraction after reporting that it produced 80,142 vehicles in the third quarter. That was 50% above its prior record but in line with views. The company delivered a total of 83,500 cars during the quarter. 53,239 of those were Model 3s, roughly double the number of that model delivered in all previous quarters combined, the company claimed.

Edwards Lifesciences stock pulled back 6% in premarket action on a Guggenheim downgrade. The medical devices leader had surged in the five sessions through Friday, leaving the stock extended above a 156.97 buy point in a cup base. Tuesday’s premarket move suggested the IBD Leaderboard stock would open Tuesday back in buy range. Not all premarket moves carry over into regular trade.

Pepsico (PEP) stumbled 1.2%, despite stronger-than-forecast third-quarter results. A 7% earnings gain and a 2% increase in revenue beat expectations, but the company lowered its full-year earnings guidance to the weak end of the consensus range. Pepsi shares are struggling to maintain support within an eight-month cup-with-handle base.

Online shopping platform StitchFix (FIX) was the morning’s downside leader, diving 26% after delivering its fiscal fourth-quarter results late Monday.  The stock ended Monday 198% above its November IPO price.

Auto Sales, Fed’s Powell Speaks; Oil Steady As Gas Jumps

The economic calendar remains fairly quiet Tuesday, dominated by automakers reporting September sales numbers throughout the session. Federal Reserve Vice Chair Randal Quarles speaks to the Senate Banking Committee at 10 a.m. ET. Fed Chairman Jerome Powell is scheduled to address a business economics forum in Boston at 12 p.m. ET.

Oil prices were mixed, after posting their strongest one-day advance since June on Monday. West Texas Intermediate traded a 0.2% higher Tuesday, holding above $75 per barrel and at a 46-month high. Brent crude dipped 0.1% to $84.86.  The American Petroleum Institute releases its weekly supply data late today.

Natural gas jumped 1%, moving to its highest mark since late January. Gas prices are up 24% from a February low.

Energy stocks were largely unmoved in Tuesday’s premarket session. Exxon Mobil (XOM), Continental Resources (CLR), Cactus (WHD) and WPX Energy (WPX) all remained in chase zones or near valid buy points.

Global Markets: Italy Worries Europe, Hong Kong Tumbles

Stocks traded lower in Europe, as the euro slid and concerns over a weakening Italy stirred fears of another peripheral economy bailout. London’s FTE 100 dipped 0.3%. Frankfurt’s DAX and the CAC-40 in Paris were each down 0.7%.

In Asia, Hong Kong’s Hang Seng index dived 2.4% as the market reopened from a long weekend break. Caixin/Markit on Sunday released its Manufacturing Purchasing Managers’ Index, which fell to a reading of 50 for September. That was down from 50.6 in August and below expectations. Readings below 50 indicate economic contraction. China’s mainland markets remain closed all week for the Golden Week holiday.

Tokyo’s Nikkei 225 managed a 0.1% advance. The index has gained in 11 of 12 recent sessions, driving it further into 27-year highs.


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Originally posted 2019-09-19 23:21:47.


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