After notching a 150-point gain on an earnings beat by American Express, the Dow Jones Industrial Average slid 0.6% in early-afternoon trading in anticipation of the Fed's meeting next week. The U.S. central bank is widely expected to post another 75-basis-point hike in short-term interest rates.
The Dow Jones still showed a stout gain of more than 2% for the week.
Plus, it appears that the blue chip average will close above the 10-week moving average, a key technical level, for the first time since the week ended April 15.
Meanwhile, the Nasdaq looks poised to snap a three-session win streak, and was down 2% at around 1:30 p.m. ET after disappointing Q2 results from Snap and Verizon on Friday.
The tech-heavy index is also under pressure as the semiconductor industry faces headwinds from slowing capital expenditures due to weakening consumer demand. The S&P 500 was down 1% while the Russell 2000 fell nearly 1.4%.
Volume on the Nasdaq was up mildly vs. the same time on Thursday and fell on the NYSE.
The Innovator IBD 50 Fund fell more than 2.5%.
American Express broke through its 50-day moving average after it beat analysts' estimates this morning and increased its guidance for the year. Revenues improved due to a significant increase in card member spending on travel and entertainment which rose above pre-pandemic levels for the first time.
AXP is still trying to bottom out. Shares are retaking their 10-week line on a weekly chart, but are still staring up at the 40-week moving average, which is beginning to bend lower.
At 23% off its 52-week high of 199.55, AmEx still has plenty of work to do to clear a potential overhead supply of sellers in the 160-180 price level and complete a good base.
Beyond Dow Jones: Earnings Season Continues
Outside the Dow Jones industrials, Alphabet is on tap for its second quarter earnings on Monday. After its record breaking Q1 revenues of $68 billion, which was a 23% increase from last year, revenue estimates for the current quarter are $57.9 billion or a 13.5% increase from the same quarter last year. It's projected to see earnings of $1.30 per share. The company announced a $70 billion share repurchase in April.
Its RS Rating, which measures the stock's performance vs. the S&P 500, has come down from 86 to 50 in the last six months, largely due to the general underperformance of technology and communications stocks. The stock is trading below its 50-day moving average
Several banks are reporting earnings on Monday. After Citigroup's earnings surprise last week, it will be interesting to watch Monday's news for other banks.
More Bank Stocks To Watch
Regional bank holding company TriCo Bancshares has been forming a long base and is trying to run past long-term resistance near 47. The stock has a Relative Strength Rating of 95, which is superior to all 30 components of the Dow Jones industrials.
In June, First Bancorp announced its merger with GrandSouth Bancorporation, expanding First Bancorp's footprint in North Carolina. The stock broke through its 50-day moving average and posted earnings of 95 cents per share in the first quarter, down 4% vs. a year earlier.
Other banks that will report on Monday are German American Bancorp, which is trading just below its 50-day moving average. Also Northrim BanCorp, which is trading above its 50-day moving line and below its 200-day line.
