Nasdaq 100 futures jumped Wednesday after Apple (AAPL) reported better-than-expected earnings late Tuesday.
XAutoplay: On | OffApple jumped in premarket trading on the stock market today, indicating an open at record highs and in a buy zone.
Meanwhile, fellow Dow industrials stocks Wal-Mart Stores (WMT), Microsoft (MSFT) and Nike (NKE) all closed Tuesday just above or below proper buy points. Wal-Mart and Microsoft are Amazon.com (AMZN) rivals, while Nike recently agreed to partner with the e-commerce giant. Wal-Mart and Nike stocks in large part owe their recent chart patterns to Amazon-related news.
S&P 500 index futures rose a fraction vs. fair value. Dow futures advanced 0.2%. Nasdaq 100 futures surged 0.7% above fair value.
Apple was a big contributor to the futures’ gain, especially the Nasdaq, rising 5.4% to 158.15 in premarket trading. The megacap tech has a 156.75 flat-base entry.
Apple earnings rose 18% to $1.67 a share in its fiscal third quarter, a dime above estimates. Revenue grew 7% to $45.4 billion. Apple sold 41 million iPhones, also above forecasts.
Investors should be cautious about electronic trading. Apple could open, or close, Wednesday’s regular session far differently. Apple also 57is off its very best overnight levels.
Wal-Mart shares rose 0.6% to 80.50 Tuesday, clearing a 80.57 cup-without-handle buy point after rising intraday to 80.73, their best level in more than two years. Volume was below average, which suggests a lack of institutional buying. Breakouts from cup-without-handle bases tend to be less successful than from cup-with-handle patterns because they don’t offer a good shakeout of weak holders. Wal-Mart’s nine-session winning streak adds to that issue.
Wal-Mart stock gapped down below its 50-day moving average on July 16 when Amazon announced that it would buy Whole Foods Market (WFM). The news hit many grocery sellers, and Wal-Mart is the biggest grocery-seller in the U.S.
But unlike many other stocks such as Costco (COST) or Kroger (KR), Wal-Mart has found support and obviously has bounced back. Wal-Mart has been making aggressive moves in e-commerce initiatives and takeovers. It has the online heft, growth and innovation to at least make Amazon work hard.
Wal-Mart will report second-quarter earnings later this month.
Microsoft shares edged down 0.2% to 72.58, their fifth consecutive decline and the second straight session below a 72.99 flat-base buy point. Microsoft cleared that entry on July 17 and edged higher from there before the recent mild slide.
Microsoft reported blowout fiscal fourth-quarter earnings on July 20, with cloud computing a key reason. Microsoft is becoming a significant rival to the much-larger Amazon Web Services. Apple soared late Tuesday on earnings and guidance, signaling a likely move above a buy point.
Nike shares rose 1.3% to 59.84, once again moving above a 59.10 buy point. Nike initially crossed that entry intraday on July 30, skyrocketing 11% to close at 59 that day. That followed Nike’s strong earnings with the athletic apparel giant also confirming that it would begin selling products directly via Amazon.
Amazon, which is not a Dow component, rose 0.85% to 996.19 on Tuesday. That snapped a three-day sell-off but closed just short of its 50-day moving average. Amazon also has fallen back below a 1,016.60 entry point.