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Dow Jones futures rose Thursday night, as did S&P 500 and Nasdaq futures, with the August jobs report looming on Friday morning. The stock rally hit intraday highs for a second straight session. But the main actions did well, with Free market (MELI) and Denbury stock among the breakouts.
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DocuSign (DOCU), Broadcom (AVGO), MongoDB (MDB) and Pager (PD) reported profit after the close. DOCU, Broadcom, MongoDB stocks all closed just above or below buy points, but diverged in trading overnight.
Meanwhile, FUBO action erupted overnight as Arizona gambled on mobile devices. FuboTV (FUBO) is a specialist in sports streaming, but the valuation of the FUBO share largely reflects the ambitions of sports betting.
Strong biosciences (FRBX) said its eczema drug failed a Phase 2 study. FRBX stock collapsed to 85%.
Major indices closed with small gains on Thursday, as tech titans such as Facebook (FB) and Google parent Alphabet (GOOGL) retreated. But small caps and especially leading stocks performed well.
Jewelers Signet rings (GIS), Denbury (THE), Netflix (NFLX), Shopify (STORE), Free market (MELI), Unity software (U) and Palantir (PLTR) were among the stocks giving signals to buy.
Denbury, Mercado Libre and SIG shares broke through and closed traditional buy points above them, while PLTR shares rose into a buy zone. Unity stock posted a short consolidation above a low base. NFLX and Shopify shares cleared entries on Thursday morning but faded with the market.
Many other top actions continued to advance, surpassing the sluggishness of the overall action.
Unity Software, DocuSign and MELI shares are listed in the IBD ranking. SHOP’s stock is on SwingTrader. Denbury was the IBD title of the day.
The video embedded in this article reviews Thursday’s market action and analyzes Mercado Libre, Unity Software, and DEN stocks.
Dow Jones Futures Today
Dow Jones futures were slightly above fair value. S&P 500 and Nasdaq 100 futures rose 0.1%.
Dow Jones futures could be relatively calm until the August jobs report at 8:30 a.m. ET. Economists expect the jobs report to show non-farm payrolls increased by 740,000, with the unemployment rate falling to 5.2%. The July jobs report showed a gain of 943,000, a figure that will almost certainly be revised with August’s employment figures.
Keep in mind that overnight action on futures contracts on Dow and elsewhere doesn’t necessarily translate into actual trades in the next regular trading session.
Join the IBD experts as they analyze the exploitable stocks in the stock market rally on IBD Live
Thursday stock market rally
The stock rally retreated from Thursday’s best levels, but the major indices all closed with small gains.
The Dow Jones Industrial Average rose 0.4% in Thursday’s stock trading. The S&P 500 index gained 0.3%. The Nasdaq composite edged up 0.1%, while the large-cap Nasdaq 100 lost a fraction, with Facebook stock falling 1.8% and Google down 1.3%. The Russell 2000 small cap advanced 0.7%.
US crude oil futures jumped 2% to $ 69.99 a barrel. Oil prices exceeded $ 70 intraday amid declining crude inventories and continued production losses from Hurricane Ida.
Among the top ETFs, the Innovator IBD 50 ETF (FFTY) climbed 1.6% to an all-time high. The Innovator IBD Breakout Opportunities ETF (BOUT) rose 1.3%. The iShares Expanded Tech-Software Sector (IGV) ETF edged down 0.1%. The VanEck Vectors Semiconductor (SMH) ETF rose 0.2%.
The SPDR S&P Metals & Mining ETF (XME) and the Global X US Infrastructure Development ETF (PAVE) rose 1%. The US Global Jets ETF (JETS) rose 0.6%. The SPDR S&P Homebuilders ETF (XHB) edged up 0.3%. The Energy Select SPDR ETF (XLE) rose 2.5% and the Financial Select SPDR ETF (XLF) rose 0.3%.
Reflecting more speculative historical stocks, ARK Innovation ETF (ARKK) rose 0.9% and ARK Genomics ETF (ARKG) rose 1%.
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Key gains
DocuSign profits exceeded views, with the leader in electronic signature software also slightly higher. DOCU stock fell 1% overnight. Shares plunged 0.9% Thursday to 294.57, just above the 50-day line and an old buy point of 290.33. DocuSign stock could offer 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’s profits exceeded views, while the chip and software giant edged up. AVGO stock was stable in extended trading. Shares fell 0.3% Thursday to 491.90, just below a buy point of 495.24 after a long, relatively shallow consolidation.
MongoDB reported a lower than expected loss along with strong revenue and forecast. MDB stock jumped 13% overnight. Shares rose 2.1% to 401.65 on Thursday. According to MarketSmith, this ranged from a point of purchase of 393.73 cups with handle.
PagerDuty also posted a better-than-expected adjusted loss while beating revenue. The PD stock climbed 14% in long action. PagerDuty stock is bottoming with a buy point of 46.57, within a much larger consolidation. Investors could have used a descending trendline – either from the February high or the short-term peak in late June – for an early PD action entry near the 200 day line, but that would have been aggressive before profits. PagerDuty stock rose 1.2% to 44.30 on Thursday.
FuboTV did not report any profits, but obtained key regulatory approval for sports betting in Arizona. FUBO stock jumped 4% overnight. This is heading towards a base buy point of 35.19. Investors could use 33.78 as an early entry into FUBO stock.
Market rally analysis
For a second consecutive session, the stock rally fizzled out after intraday highs. While blending into the fence isn’t an ideal action, a period of sideways action is probably healthy overall. The S&P 500 and the Nasdaq are at record levels.
and Google parent Alphabet (GOOGL) retreated from record highs on Thursday, as other tech titans took a break. This helped prevent the expansion of the Nasdaq and Nasdaq 100, leaving more room for high profile stocks.
And that’s what executives are doing as a whole with MELI, Denbury and Signet shares coming out on Thursday. The FFTY ETF hit a new high on Thursday. ARKK recovered key moving averages this week as much-loved growth improves.
The scale of the market continues to improve, with small cap Russell 2000 now moving to all-time highs.
Large-cap technologies are performing well overall. Some stocks of chips and software are doing well. The same is true of several IPOs and speculative names, as well as long-term leaders.
Meanwhile, Steel values are finding support, Energy values are recovering while various other commodity-related games are strengthening.
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What to do now
With new buying opportunities, investors could continue to increase their exposure. However, they may not want to increase their buying now, especially from the late August rebound in key support.
Keep working on your watchlists. This is the best way to identify potential leaders and take advantage of early entries, which has been a more successful strategy in today’s turbulent market.
Read The Big Picture every day to stay in tune with the market direction and major stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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