Dow Jones Futures Fall Ahead Of Fed Meeting; Caterpillar, Exxon, Pfizer Report Earnings

January 31, 2023

Dow Jones futures dropped Tuesday, heading into January's final session. The Federal Reserve's policy meeting kicks off today, followed by an interest rate policy decision on Wednesday. Meanwhile, Dow Jones stocks Caterpillar (CAT) and McDonald's (MCD) were among the many names reporting quarterly earnings results.
Looking toward tomorrow afternoon's rate policy announcement, the Fed is widely expected to raise the target federal funds rate by 25 basis points, to a range of 4.5% to 4.75%. Investors place a 99% probability of that size hike, according to the CME's FedWatch tool.
Early Tuesday, Apple supplier NXP Semiconductors (NXPI) declined more than 4% in premarket trade after reporting its fourth-quarter earnings results late Monday.
Allegro MicroSystems (ALGM), General Motors (GM), Spotify (SPOT) and United Parcel Service (UPS) all reported their quarterly results early Tuesday. Allegro rallied 2.5%, while Spotify jumped 5% and UPS stock traded up 2%.
General Motors raced 5% higher, after revenue and earnings easily topped views. The company also announced it would invest $650 million in a Nevada lithium mining operation. The news sent shares of Lithium Americas (LAC) up more than 11%.
Among the Dow Jones companies, Caterpillar and McDonald's were both lower after earnings. CAT stock dropped almost 3% in early trade, while McDonald's shares fell more than 2%.
Finally, Pfizer (PFE) and Exxon Mobil (XOM) were also both lower after their quarterly earnings results. Pfizer shares lost more than 3%. And Exxon stock traded down nearly 2% after its Q4 report.
This week features big earnings results from Amazon (AMZN), Apple (AAPL), Alphabet (GOOGL) and Meta Platforms (META). Meta's earnings are due out late Wednesday, while Alphabet, Amazon and Apple earnings are set for Thursday after the close.
Stock Market Today
Electric-vehicle leader Tesla fell 1% Tuesday morning, after a pullback of more than 6% on Monday. Dow Jones tech giants Apple and Microsoft (MSFT) were also lower ahead of today's stock market open.
IBD Leaderboard stock Impinj (PI), Etsy (ETSY) and Wingstop (WING) — as well as Dow Jones stocks Chevron (CVX) and JPMorgan Chase (JPM) — are among the top stocks to buy and watch, with the ongoing strength of the market rally.
Impinj is an IBD Leaderboard stock. Etsy was a recent IBD Stock Of The Day. Impinj and Wingstop were featured in this week's Stocks Near A Buy Zone column.
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Dow Jones Today: Oil Prices, Treasury Yields
Ahead of Tuesday's opening bell, Dow Jones futures fell 0.35% vs. fair value, and S&P 500 futures narrowed losses to a fraction. Nasdaq 100 futures lost 0.3% in morning action.
Among U.S. exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.3% and the SPDR S&P 500 ETF (SPY) traded down less than 0.1% early Monday.
The 10-year U.S. Treasury yield ticked lower to 3.52% Tuesday morning, threatening to snap a three-day win streak. Last week, the 10-year yield barely ended a three-week losing skid.
Oil prices extended Monday's losses, falling more than 1% in morning trade, as investors look toward Wednesday's OPEC meeting. West Texas Intermediate futures held just above $77 a barrel. Ministers from the Organization of Petroleum Exporting Countries and its allies, including Russia (OPEC+) will meet on Wednesday. OPEC is widely expected to maintain current oil production levels, but may discuss possible policy tweaks and expectations for demand from China.
Stock Market Rally
On Monday, the Dow Jones Industrial Average snapped a six-day win streak, falling 0.8%. The S&P 500 dropped 1.3%, while the Nasdaq composite sold of 2%.
Monday's The Big Picture column cautioned, "IBD has raised its recommended exposure as resistance levels have broken, now lifting to the current 60%-80%. But indexes don't have much room above support levels and must now hold their newly-conquered beachheads. This week is fraught with risk that could push stock back into the water. But if the stock market can pass those tests, investors should prepare to raise exposure."
Now is an important time to read IBD's The Big Picture column amid the ongoing stock market rally.
Five Dow Jones Stocks To Buy And Watch Now
Dow Jones Stocks To Buy And Watch: Chevron, JPMorgan
Energy giant Chevron declined another 2.9% Monday, breaking down below its key 50-day line. Shares are adding a handle to a cup base, lowering the entry from 189.78 to 187.91, according to IBD MarketSmith chart analysis. CVX stock again fell 1% Tuesday morning.
Banking giant JPMorgan remains in buy range above a 138.76 flat-base buy point despite a 0.9% loss Monday. JPM shares traded a fraction lower early Tuesday.
JPM stock shows a solid 94 out of a perfect 99 IBD Composite Rating, per the IBD Stock Checkup. The Composite Rating is designed to help investors easily find top growth stocks.
4 Top Growth Stocks To Buy And Watch In The Stock Market Rally
Top Stocks To Buy And Watch: Impinj, Etsy, Wingstop
IBD Leaderboard stock Impinj ended Monday below a 129.12 buy point in a cup base following its recent breakout move, as shares dropped 2.9% Monday. Look for a decisive retake of the buy point to signal another chance to buy shares. PI stock was unchanged Tuesday.
Backstory: Impinj's expertise lies in RF (radio frequency) semiconductors to identify, locate and authenticate items. While losing money in 2020, the company earned 25 cents per share in 2021. And annual earnings are expected to surge 284% to 96 cents per share this year.
Etsy is back below a 137.01 buy point in a cup with handle after Monday's 2.25% drop. If the stock regains the entry, the 5% buy area goes up to 143.86. Etsy shares fell 0.4% Tuesday morning.
Backstory: The company is a provider of an online e-commerce platform where creators of arts and crafts, vintage items and other unique goods go to sell their products. It has a unique business model that, in the last few years, has gone from a niche e-commerce marketplace to a top-of-mind shopping destination across numerous categories.
Wingstop is rapidly approaching a 170.97 buy point in a lopsided cup base. Keep an eye out for a potential handle to offer a lower entry. WING stock was inactive early Tuesday.
Backstory: The Dallas-based restaurant chain has over 1,900 locations in the U.S. and international markets, according to Dow Jones Newswires. Its international locations include Mexico, Columbia, Panama, Singapore and the U.K. The company added a net 40 stores in the prior quarter. Earnings are due out Feb 22.
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Stocks To Buy And Watch In Stock Market Rally
These are seven top stocks to buy and watch in today's stock market, including two Dow Jones leaders.
Company Name Symbol Correct Buy Point Type Of Base Monster (MNST) 104.75 Flat base Vertex (VRTX) 324.85 Cup base Axon (AXON) 189.72 Cup with handle Etsy (ETSY) 137.01 Cup with handle JPMorgan (JPM) 138.76 Flat base Chevron (CVX) 187.91 Cup with handle Wingstop (WING) 170.97 Cup base
Source: IBD Data As Of Jan. 31, 2023
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Tesla Stock
Tesla stock dived 6.3% Monday, snapping a six-day win streak and giving up a part of last week's 33% surge. Despite their strong rebound since Jan. 6, shares are still below the 200-day line. Tesla stock closed about 56% off its 52-week high.
Shares threatened to extend Monday's losses, falling 1% in early morning trade.
Dow Jones Leaders: Apple, Microsoft
Among Dow Jones stocks, Apple shares stumbled 2% Monday, ending a two-day win streak. But they are still holding above their 50-day line following strong gains in recent sessions. The stock remains around 20% off its 52-week high. Apple will report its quarterly earnings on Thursday. AAPL stock moved down 0.6% Tuesday.
Microsoft stock slid 2.2% Monday, finishing just above its 50-day line, which it regained last week. Shares remain 23% off the 52-week high. MSFT traded down 0.4% Tuesday.
Be sure to follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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This data comes from MediaIntel.Asia's Media Intelligence and Media Monitoring Platform.

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