The Dow Jones Industrial Average briefly fell more than 125 points on coronavirus stimulus hopes early Monday after reversing from early gains. Tech giants Amazon, Apple, Shopify and Tesla approached new buy points.
Stocks in or near buy zones in the stock market rally are FANG stock Amazon.com (AMZN), Shopify (SHOP) and Tesla (TSLA). Amazon fell nearly 1%. Shopify gained 1.6%, while Tesla turned flat after giving up sharp gains.
Microsoft and Tesla are both IBD Leaderboard stocks.
Dow Jones Today: Coronavirus Stimulus Hopes
The Dow Jones Industrial Average turned down 0.3%, while the S&P 500 faltered 0.3%. The Nasdaq reversed lower to fall 0.2%.
On Sunday, House Speaker Nancy Pelosi set a Tuesday deadline for a coronavirus stimulus deal. If there’s no deal by then, a stimulus package will have to wait until after November’s election. Pelosi and Treasury Secretary Steven Mnuchin are set to speak again Monday.
U.S. Stock Market Today Overview
Last Update: 10:50 AM ET 10/19/2020
Amid the coronavirus stock market rally, the tech-heavy Nasdaq is up 30.1% for the year through Friday’s close. Meanwhile, the S&P 500 is up 7.8%, while the Dow is up 0.2% year to date, through the Oct. 16 close.
According to the Worldometer data tracker, the cumulative number of confirmed coronavirus cases in the U.S. topped 8.3 million on Monday. Total virus-related deaths topped 224,000.
The cumulative total of Covid-19 cases confirmed since the start of the outbreak worldwide topped 40.3 million Monday, with more than 1.1 million virus-related deaths.
Coronavirus Stock Market Rally
According to IBD’s The Big Picture, the coronavirus stock market rally continues after the recent stock market correction ended on Sept. 30.
Friday’s Big Picture reported that “Market signals were mixed this past week, but nothing that would alter the market’s confirmed uptrend. The Nasdaq made a follow-through Monday, which strengthened the new market uptrend. But the S&P 500 suffered distribution during the week. Indexes closed near the week’s lows.”
After the Dow’s bullish signal on Sept. 30, investors are cleared to start buying new breakout stocks. The best candidates are those that proved most resilient during the recent stock market weakness. Keep a close eye on stocks with strong relative strength lines. These ideas could become stock market leaders.
Use MarketSmith features like the RS Line Blue Dot to easily spot such stock candidates. The RS Line Blue Dot is assigned to stocks whose RS lines are making new highs while the stock is basing or breaking out.
Stocks to watch include IBD Long-Term Leaders, companies with stable earnings growth and price performance.
Dow Jones News: Salesforce Offers New Buy Point
Among the Dow Jones top stocks, Salesforce rallied 0.3%, as it approaches a cup with handle’s 270.26 buy point.
According to the IBD Stock Checkup, CRM stock has a 98 out of a best-possible 99 IBD Composite Rating. The Composite Rating — an easy way to identify top growth stocks — is a blend of key fundamental and technical metrics to help investors gauge a stock’s strengths.
Stocks On The Move: Tesla
Tesla stock was flat Monday, fighting to snap a two-day losing streak. Shares are just 13% off their 52-week high, as they form a new base with a 502.59 buy point.
According to IBD Leaderboard commentary, “Tesla is now forming an awkwardly shaped base. Shares are extended from the 50-day line. It is a half position on Leaderboard.”
Tesla earnings are due out Wednesday after the close.
Stocks In Or Near Buy Zones: Amazon, Shopify
Amazon fell almost 1% Monday morning, on pace to extend a three-day losing streak. Shares are finding support near their 50-day moving average line.
Shopify gained 1.6% early Monday, set to end a three-day losing streak. Shares are tracing a cup with handle, offering a 1,130.10 buy point.
The stock is about 5% away from the new entry.
Dow Jones Leaders: Apple, Microsoft
Among the top Dow Jones stocks, Apple rose 0.3% early Monday, looking to add to Friday’s 1.4% decline. Shares are moving up the right side of a new cup base, showing a 138.08 buy point, according to MarketSmith chart analysis.
Meanwhile, a potential handle is close to forming, which would lower the risk-optimal entry to 125.49.
The blue-chip giant is the No. 1-performing Dow Jones stock for 2020, with a 62.1% advance through Friday’s close. Recent Dow Jones 30 addition Salesforce is the No. 2 performer with a 59.0% year-to-date advance.
Software leader Microsoft lost 0.5% early Monday. Shares are forming a new cup base with a 232.96 buy point. Be on the lookout for a potential handle to create a more risk-optimal entry.
Year to date, Microsoft is one of the top Dow Jones stocks, advancing 39.3% through Friday’s close.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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