The stock market indexes stalled after a Monday rally attempt, settling into choppy action in the afternoon session.
Tech stocks received the bulk of speculative buying interest, while small-cap energy stocks ignored the sell-off in the futures pits. A basket of those plays rallied to one- and two-month highs.
The Dow Jones Industrial Average is trading flat at this hour while the S&P 500 is down 0.1%. The Nasdaq composite is leading the upside once again, posting a 0.2% gain.
Volume compared with Friday is holding its own for a summer Monday, down 5% on the Nasdaq and up the same percentage on the NYSE.
Weak data weighed on crude oil prices, dropping the West Texas Intermediate contract more than 4% to 93.97. Bond yields fell across all maturities, with the 10-year Treasury yield shrinking to 2.61%.
Investors bought shares of Tesla for the fourth day in a row, lifting the EV maker to a three-month high at 935.63. Shares erased much of their earlier gains as they test the 200-day line.
China Wild Card In Play
Nancy Pelosi (D-Calif.) will visit Taiwan in the next 24 hours. China has warned it will retaliate, raising odds for a military or logistical confrontation of some sort.
The market is ignoring this potential wild card. The high complacency is dangerous, given the potential impact on China stocks, U.S. trade interests and multinationals with billions in exposure.
As a reminder, the Russia-Ukraine war came as a "surprise" in the first quarter, forcing hundreds of U.S. corporations to walk away from profitable Russian operations. It also added to supply-chain woes, compounding the global crisis caused by the pandemic.
Stock Market Catalysts This Week
The July nonfarm payrolls report arrives at 8:30 a.m. on Friday. Consensus now stands at 250,000. The U.S. added 372,000 jobs in June, so this would mark a deceleration in the labor market. However, summer data adjusts for all sorts of seasonal variations, so we may have to wait until the fourth-quarter to accurately measure the economy's strength.
Hundreds of companies report second-quarter earnings this week but just a few stand out as market movers.
Advanced Micro Devices is a Nasdaq 100 speculative favorite that reports after Tuesday's closing bell. The company is expected to post a profit of $1.04 per share on $6.5 billion in second-quarter revenue.
The stock has rallied nearly 37% since bottoming out in July and has closed more than half the distance into the 109.67 buy point of a potential double-bottom base.
Monday Stock Market Highlights
No. 4 IBD 50 component Enphase Energy stalled after last week's powerful breakout. The stock cleared a double-bottom base within a long consolidation, then lifted into a 282.56 buy point.
It's currently trading right at that level while relative strength has soared across multiple time frames.
Even so, SEC filings just disclosed that two Enphase directors sold 85,822 shares of stock worth $23.4 million, using the rally to lighten up on positions. This could be an early warning sign because just 2.08% of the 135.46 million outstanding shares were held by insiders before the sale.
The S in CAN SLIM refers to supply, which benefits from stock buybacks that reveal the confidence of insiders. Insiders dumping shares may reveal the opposite, especially when a great selling opportunity presents itself.
Global Payments has rallied nearly 7% on strong results after agreeing to buy EVO Payments for $4 billion. The rally has lifted GPN into resistance at the 200-day moving average, which has narrowly aligned with the 132.37 buy point.
Celsius Holdings rallied 11.4% after the company announced a long-term strategic distribution arrangement with PepsiCo that includes an investment by the beverage and snack giant.
An IBD 50 stock, Celsius is well past the 5% buy zone after clearing an aggressive entry with volume, and may be forming a big cup with a new buy point of 110.32.
Follow Alan Farley on Twitter @msttrader.
