Dow Jones futures rose slightly Friday morning, along with S&P 500 futures and Nasdaq futures, with the August jobs report looming. The stock market rally came off intraday highs for a second straight session. But leading stocks fared well, with Mercado Libre (MELI) and Denbury stock among breakouts.
DocuSign (DOCU), Broadcom (AVGO), MongoDB (MDB) and PagerDuty (PD) reported earnings after the close. DOCU stock, Broadcom, MongoDB all closed just above or below buy points, but diverged in overnight trade.
Meanwhile, FUBO stock popped overnight as Arizona OK’d wagering via mobile devices. FuboTV (FUBO) is a sports-streaming specialist but the FUBO stock valuation largely reflects sports-betting ambitions.
Forte Biosciences (FRBX) said its eczema drug failed a Phase 2 study. FRBX stock crashed 85%.
The major indexes closed with slim gains Thursday, as tech titans such as Facebook (FB) and Google parent Alphabet (GOOGL) retreated. But small caps and especially leading stocks had a solid performance.
Denbury, Mercado Libre and SIG stock broke past traditional buy points and closed above them, while PLTR stock nudged higher in a buy zone. Unity stock cleared a short consolidation above a bottoming base. NFLX stock and Shopify cleared entries Thursday morning but faded with the market.
Many other leading stocks continued to run higher, outpacing the sluggish overall action.
The video embedded in this article reviews Thursday’s market action and analyzes Mercado Libre, Unity Software and DEN stock.
Dow Jones Futures Today
Dow Jones futures were 0.1% above fair value. S&P 500 futures climbed 0.2% and Nasdaq 100 futures rose 0.1%.
Dow Jones futures may be relatively quiet until the August jobs report at 8:30 a.m. ET. Economists expect the jobs report to show nonfarm payrolls rose by 740,000, with the jobless rate falling to 5.2%. The July jobs report showed a gain of 943,000, a figure that will almost certainly be revised with the August employment figures.
Stock Market Rally Thursday
The stock market rally retreated from Thursday’s best levels but the major indexes all closed with slim gains.
The Dow Jones Industrial Average rose 0.4% in Thursday’s stock market trading. The S&P 500 index gained 0.3%. The Nasdaq composite edged up 0.1%, while the big-cap Nasdaq 100 lost a fraction, as Facebook stock fell 1.8% and Google 1.3%. The small-cap Russell 2000 rose 0.7%.
U.S. crude oil futures jumped 2% to $69.99 a barrel. Oil prices topped $70 intraday amid declining crude inventories and continued production losses from Hurricane Ida.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) popped 1.6%, hitting a record high. The Innovator IBD Breakout Opportunities ETF (BOUT) rallied 1.3%. The iShares Expanded Tech-Software Sector ETF (IGV) edged down 0.1%. The VanEck Vectors Semiconductor ETF (SMH) rose 0.2%.
SPDR S&P Metals & Mining ETF (XME) and Global X U.S. Infrastructure Development ETF (PAVE) advanced 1%. U.S. Global Jets ETF (JETS) ascended 0.6%. SPDR S&P Homebuilders ETF (XHB) edged up 0.3%. The Energy Select SPDR ETF (XLE) climbed 2.5% and the Financial Select SPDR ETF (XLF) nudged 0.3% higher.
DocuSign earnings beat views with the e-signature software leader also guiding modestly higher. DOCU stock fell a fraction early Friday. Shares dipped 0.9% on Thursday to 294.57, just above the 50-day line and an old 290.33 buy point. DocuSign stock could offer an early entry above last Monday’s high of 308.74, not far from the official buy point of 310.61 from a new flat base.
Broadcom earnings topped views, while the chip-and-software giant guided slightly higher. AVGO stock was steady in extended trade. Shares dipped 0.3% on Thursday to 491.90, just below a 495.24 buy point from a long, relatively shallow consolidation.
MongoDB reported a smaller-than-expected loss along with strong revenue and guidance. MDB stock surged 14% overnight. Shares rose 2.1% to 401.65 on Thursday. That was in range from a 393.73 cup-with-handle buy point, according to MarketSmith.
PagerDuty also posted a better-than-expected adjusted loss while beating on revenue. PD stock shot up 15% in extended action, signaling a breakout. PagerDuty stock has a bottoming base with a 46.57 buy point, within a much-larger consolidation. Investors could have used a downward-sloping trend line — either from the February high or late June short-term peak — for an early PD stock entry near the 200-day line, but that would have been aggressive heading into earnings. PagerDuty stock rose 1.2% to 44.30 on Thursday.
FuboTV didn’t report earnings, but did earn key regulatory approval for sports betting in Arizona. FUBO stock popped 4% overnight. That’s moving toward a 35.19 bottoming-base buy point. Investors could use 33.78 as an early entry into FUBO stock.
Market Rally Analysis
For a second straight session, the stock market rally fizzled from intraday highs. While fading into the close isn’t ideal action, a spell of sideways action is probably healthy overall. The S&P 500 and Nasdaq are right at record levels.
and Google parent Alphabet (GOOGL) retreated from record highs Thursday, while other tech titans paused. That helped keep the Nasdaq and Nasdaq 100 from getting extended, leaving leading stocks more room to run.
And that’s what leaders are doing overall with MELI stock, Denbury and Signet breaking out Thursday. The FFTY ETF hit a new high Thursday. ARKK has reclaimed key moving averages this week as highly valued growth perks up.
Market breadth continues to improve, with the small-cap Russell 2000 now moving toward all-time highs.
Big-cap techs are acting well overall. Some chips and software stocks are doing well. So are several hot IPOs and speculative names, as well as Long-Term Leaders.
Meanwhile, steel stocks are finding support, energy stocks are reviving while various other commodity-related plays are shoring up.
What To Do Now
With new buying opportunities, investors could continue to be boosting exposure. However, they may not want to ramp up buying now, especially compared to the late August bounce from key support.
Keep working on your watchlists. It’s the best way to identify potential leaders and take advantage of early entries, which has been a more-successful strategy in the current choppy market.
Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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