Stock futures set up for a strong open Friday, as the Nasdaq, the S&P 500 and the Dow looked to extend their rebound rallies to a fourth session. Earnings news stirred early optimism, with Snap, Twitter and Skechers knocking out big gains. Meanwhile, American Express and Intel went separate ways on the Dow Jones today, following their Q2 reports.
Dow Jones futures and S&P 500 futures climbed 0.4% above fair value. Nasdaq 100 futures moved up 0.3%. Small caps slightly outpaced the overall premarket action, with Russell 2000 futures rising 0.6%.
Twitter (TWTR) jumped 4.6% to lead the S&P 500. Twitter earnings, reported late Thursday, beat top- and bottom-line estimates by wide margins. Premarket action suggested Twitter would open in a buy zone above a handle buy point at 72.17.
Positive sentiment from Snap and Twitter results buoyed confidence in social media stocks. Facebook (FB) rallied 2.9% to lead the Nasdaq 100, ahead of its Q2 report, due on Wednesday. Pinterest (PINS) rallied more than 4% ahead of its report next Thursday. Both Facebook and Pinterest are IBD 50 stocks.
Skechers (SKX) jetted 7.2% higher after reporting above-forecast second-quarter revenue and earnings, and raising its third-quarter and full-year guidance. The premarket move implied a starting bell breakout, past a 51.58 buy point in a double-bottom base.
Sweden-based Veoneer (VNE) launched 55% higher after Magna International (MGA) announced it would acquire the maker of automotive radar and braking systems. The $3.3 billion cash/stock deal will buy out Veoneer’s outstanding shares for $31.25 per share, about 57% above Thursday’s closing price. Magna shares slipped 1.1% in early trade.
China-based stocks were taking a pounding, with JD.Com (JD), Pinduoduo (PDD) and Trip.com (TCOM) all down more than 3% at the bottom of the Nasdaq 1oo. Earnings news sent Kimberly Clark (KMB) down 3.5%, and Verisign (VRSN) to a 3.8% loss, the biggest drops on the S&P 500.
Dow Jones Today: AXP, Intel Earnings
American Express (AXP) muscled up 3.9%, seizing an easy early lead on the Dow Jones today. American Express earnings blew past analyst targets, and a 34% revenue surge also topped expectations. AmEx stock remains in a buy range, on a rebound from its 10-week moving average, through around 177.63.
Honeywell International (HON) slipped 09.8% following its Q2 report.
Intel (ITNC) dragged at the bottom of the Dow, down 2.6% as at least four analysts lowered their price targets on the stock. Intel earnings topped views, along with overall revenue and data-center chip sales. But the chipmaker guided slightly lower on Q3 sales.
Vital Signs: Oil Prices, Bond Yields, Bitcoin
Oil prices eased Friday morning, following a three-day rebound. U.S. benchmark West Texas Intermediate future dipped 0.2% to $71.75 a barrel. That left oil a fraction higher for the week, as prices work to end a two-week slide.
Bonds and yields remained tame while still pointing lower for the week. The 10-year yield edged up to 1.28% early Friday, after settling just below 1.27% on Thursday. Yields on Tuesday briefly fell to their lowest level since Feb. 2, then rose to retake support at their 200-day moving average on Wednesday.
Bitcoin traded almost 2% higher, above $32,400, after dipping to $29,327 on Tuesday. The cryptocurrency had traded above $36,000 in late June, and touched a record high near $65,000 in April.
Nasdaq, S&P 500, Dow Jones Today
The Nasdaq is leading the market for the week heading into Friday’s session. The Nasdaq Composite gained 1.8% through Thursday, vs. a 0.9% advance for the S&P 500. The Dow Jones today opens sitting on a 0.4% gain for the week.
For the year, the Nasdaq and the Dow are now almost even. The Nasdaq so far has a 13.9% gain. The Dow is up 13.8%, while the S&P 500 is ahead 16.3%. The Dow Jones industrials are up
For more detailed analysis of the current stock market and its status, study the Big Picture.
A 1.6% drop for the Russell 2000 on Thursday left the index up 1.7% for the week following a big bounce off support at its 200-day line. With a week to go in July, the Russell is pointed toward its first decline in 10-months, and is lagging the market with an 11.4% year-to-date gain.
The Nasdaq and S&P 500 are each less than 1% off their record highs, set on July 13 and 14, respectively. The Dow is also less than 1% off its May 10 record. Meanwhile, the Russell 2000 is hanging more than 7% off its highest mark, chalked up on March 15.
Benchmark ETFs Near Buy Points
Growth stocks have slightly outperformed so far for the week, with the iShares Russell 1000 Growth ETF (IWF) rising 1.9% through Thursday. The fund has gained just over 6% since passing a flat base buy point in mid-June.
The Nasdaq tracker Invesco QQQ Trust (QQQ) ended Thursday less than 1% below a 365.49 buy point in a three-weeks-tight pattern. The fund is narrowly extended, up 6% since clearing flat base in mid-June.
As for ETFs tracking the Dow Jones today, the SPDR Dow Jones Industrial Average ETF Trust(DIA) is less than 1% below its 348.75 entry. The leveraged ProShares Ultra Industrials(UXI) is 2% below its buy point at 34.07.
Find Alan R. Elliott on Twitter @IBD_Aelliott
YOU MAY ALSO LIKE: