Stock futures steered south ahead of Tuesday’s open, threatening to put a damper on the market’s two-day bounce, despite strong early moves from Vertex Pharmaceuticals (VRTX), AmerisourceBergen (ABC) and a handful of China-based stocks.
X Futures for the Dow Jones industrial average and S&P 500 dipped 0.3%. Nasdaq 100 futures traded 0.2% below fair value. Small caps traded at the weak end of the premarket session, with Russell 2000 futures off 0.4%. Futures were well off session lows.
In global stocks, China’s markets picked up on the U.S. rally and retook lost ground ahead of their week-long Lunar New Year holiday. Hong Kong’s Hang Seng index popped 1.3%, the Shanghai Composite rallied 1%. Shanghai will close Thursday through Wednesday. Hong Kong will be closed Friday and Monday.
In Japan, the Tokyo Stock Exchange reopened after Monday’s holiday, with the Nikkei 225 stumbling 0.7%.
Europe’s markets were narrowly mixed near midday. Frankfurt’s DAX and the CAC-40 in Paris were down 0.5% each. London’s FTSE 100 clung to a fractional gain.
Chevron Leads, CAT Lags On Dow; Vertex, Blue Apron, China Names Surge
Chip stocks were mixed, with no wide swings up or down among the leading names. Top steel stocks were largely unchanged, holding their ground after Monday’s strong advance.
On the Dow, Apple (AAPL) and Caterpillar (CAT) were among the handful of names posting losses of around 0.5%, restraining early action. Apple retook its 200-day line with a powerful 4% rally on Monday. The stock has been struggling to regain and hold that psychologically important level of support since Feb. 5.
Chevron (CVX) clocked an early lead among Dow Jones stocks, rising 1.3%. The stock is fighting to hold support at its 40-week moving average.
Vertex Pharmaceuticals snapped up 3%, to the top of the Nasdaq 100, after the Food And Drug Administration approved the company’s Symdeko to treat Cystic Fibrosis. Vertex said it would begin shipping the drug this week. Vertex shares had pulled back more than 8% below a 167.95 buy point, triggering the automatic sell rule. Shares have been testing support at their 10-week moving average.
Drug wholesaler AmerisouceBergen spiked 13% in premarket action, after news reports said the company was in talks with Walgreens Boots Alliance (WBA) regarding a possible takeover. Walgreens owns 26% of the company, which holds a market capitalization of more than $19 billion. During the market sell-off, AmerisourceBergen had pulled back 9% below a buy point at 94.54. That triggered the automatic sell rule.
Walgreens shares dropped 1.7% in early trade. Its shares are trading deep in a year-long consolidation. AmerisourceBergen competitors Cardinal Health (CAH) and McKesson (MCK) dropped 3% apiece in premarket trade.
Under Armour (UAA) grabbed an 12% gain, despite a mixed fourth-quarter report, as revenue came in stronger than expected. Shares ended Monday up 27% from a November low, and down 72% from its April 2016 peak.
China-based names were early leaders, with IBD 50 name Weibo (WB) up 6% after an across-the-board fourth-quarter beat. Weibo shares are testing support at their 10-week moving average, after falling more than 8% below a 122.31 buy point and triggering the automatic sell rule.
Sina (SINA) rolled ahead more than 4% after a generally strong fourth-quarter report. Sina, which holds a controlling stake in Weibo also fell more than 8% below its 119.30 cup-base buy point, making it also subject to the automatic sell rule.
Vipshop Holding (VIPS) swung 6% higher. The online retailer turned in its fourth-quarter report late Monday, topping analysts’ earnings and revenue targets, and raising its first quarter revenue guidance above expectations.
Oil, Bitcoin Slip: Natural Gas, Bonds, Copper Rise
Crude oil traded lower, after posting a 0.2% gain on Monday — just enough to snap a six-day downtrend. U.S. benchmark crude was down 0.5% in early action, trading below $59 a barrel. Among other commodities, natural gas popped 2% — looking for a rebound after falling hard in nine of 10 recent sessions. Copper rose almost 2%, after posting a 1.7% gain on Monday.
The dollar pulled back against the euro, and slipped to a five-month low vs. the yen. Bonds gained ground, trimming the 10-year yield two basis points to $2.83%.
Bitcoin slipped to near $8,500, down 4% from Monday’s high. Bitcoin- and blockchain-related stocks were generally quiet:
- Riot Blockchain (RIOT): down 2.8%
- Bitcoin Investment Trust (GBTC): unchanged
- Mara Patent Group (MARA): unchanged
- Overstock.com (OSTK): down 0.3%
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