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Nasdaq Loses Early Gain; PayPal, Red Hat, Adobe Systems Try To Hold Support | Stock News & Stock Market Analysis

Tech stocks got a much-needed lift early Tuesday, although a 0.9% intraday gain for the Nasdaq composite was pared to 0.1% in afternoon trading.

Signs of institutional selling in the Nasdaq have been easy to see in recent days amid broad-based weakness in semiconductor stocks and some selling in FANG names like Facebook (FB) and Netflix (NFLX).

X The Dow Jones industrial average gave back 0.4% and the S&P 500 eased 0.3%. Small caps lagged, with the Russell 2000 down 0.5%. Volume on the NYSE and Nasdaq was tracking about 15% below Monday’s levels in the stock market today.

The 10-year Treasury yield was recently trading around 2.36%, down 1 basis point, while U.S. crude oil futures settled at $57.62 a barrel, up 0.3%.

Among the day’s movers, Dow component Walt Disney (DIS) slumped around 2.4% after soaring nearly 5% Monday. Early Tuesday, CNBC reported that Disney and 21st Century Fox (FOXA) are close to a deal in which Disney would acquire Fox’s movie studio and TV production assets, while Fox would hold on to its news and sports assets. Shares of 21st Century Fox added 0.6%.

Microsoft (MSFT) outperformed in the Dow, rising 0.9%, as it gets support at the 50-day moving average for the first time after a breakout from a flat base in late August. Microsoft also is forming a new flat base.

After four straight heavy-volume declines, Applied Materials (AMAT) added 0.1% in heavy volume. The chip-equipment bellwether is still below the 50-day line, however, about 17% off its high.

Inside the IBD 50, Align Technology (ALGN) is getting support at the 50-day moving average after shares plunged 11% Monday in higher volume. The weak action was a sell signal for those who bought at the last buy point of 102.10.

Other IBD 50 names holding at the 50-day line so far include Arista Networks (ANET), PayPal (PYPL), Red Hat (RHT) and Adobe Systems (ADBE).

HealthEquity (HQY) was volatile again ahead of its earnings report after the close. The volatility started right after the stock broke out bullishly over a 52.97 buy point in early November. Shares crashed 9% the very next day and the stock has had a hard time attracting buyers ever since. HealthEquity dipped below the 200-day moving average early Tuesday but was well off session lows in afternoon trading.

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