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XAutoplay: On | Off Stock futures rose early Monday morning after a mixed week in which a handful of big-cap techs, notably Apple (AAPL), Amazon (AMZN) and Netflix (NFLX), continued to power ahead. Meanwhile, Citigroup (C) is trying to break out as most banking peers mark time.
Nasdaq 100 futures and S&P 500 futures rose 0.2% vs. fair value. Dow Jones industrial average futures climbed 0.1%.
U.S. crude oil futures rose 1.4% to $48.53 a barrel after Saudi Arabia and Russia said in a joint press event in Beijing that they favor extending the OPEC/non-OPEC production cuts by nine months to the end of Q1 2018. OPEC and its allies meet May 25.
The Dow industrials and S&P 500 index dipped last week, while the Nasdaq composite rose for a fourth straight week. Apple, the biggest component of the Dow, S&P 500 and Nasdaq composite, rose 4.8% last week to record highs, and is up nearly 9% so far in May.
Amazon rose 2.9% last week, hitting a new high Friday. Netflix advanced 2.7%, hitting record levels during the week. Facebook (FB) and Google parent Alphabet (GOOGL), the other two members of the FANG internet giants rose fractionally near all-time bests.
All five of these tech titans are up at least 20% so far this year, with Apple surging 35%. If the FANG+ stocks falter — or merely move sideways — will another broad sector step up to keep the overall market rally going?
Bank stocks have largely been basing for the past few months, as the postelection rally stalls amid lower Treasury yields and concerns about whether President Trump will be able to enact tax cuts and other pro-growth agenda items.
Citigroup is in a flat base next to a failed breakout from a cup pattern. Citi rose 0.6% to 61.07 in Friday stock market trading. The current consolidation has a standard buy point of 62.63, 10 cents above the March 8 intraday peak. However, investors could view 60.89 as an aggressive entry. Citi nudged past that price several times in the past two weeks, but didn’t close above it until Friday. Volume was 9% below average on Friday, which suggests lackluster buying by big institutions.
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Citi’s relative strength line has moved sideways for the past few months, below early January peaks. It’s better to see a stock’s RS line rising to new high before a stock breaks out.
Citi is faring better than many other banking giants. Bank of America (BAC) is just above its 50-day moving average. JPMorgan Chase (JPM), a member of the Dow Jones industrial average, and Morgan Stanley (MS) are both just below their 50-day lines. Goldman Sachs (GS), another Dow component, and Wells Fargo (WFC) are near recent lows. Wells Fargo shares sold off late last week amid revelations that the number of fake accounts created by the bank’s staff apparently was much higher than expected.
Japan’s Nikkei fell 0.1% in Monday trading, while China’s Shanghai composite rose 0.3% and Hong Kong’s Hang Seng climbed 0.5%. Australia’s S&P/ASX 200 dipped 0.1%.
China released economic data showing slower-than-expected industrial production, retail sales and investment gains in April vs. a year earlier.