Dow Jones Futures: After the Decline in the Stock Market Rally, IBM Shares Move Too Late on Earnings


Dow Jones futures rose modestly on Tuesday night, along with the S & P 500 futures and Nasdaq futures as the stock market rally staggered amid Chinese trade worries, suffering the biggest setback since the fall of Apple shares on January 3. IBM shares rallied late on earnings, good news for Dow Jones. Results for online brokers TD Ameritrade (AMTD) and Interactive Broker (IBKR) deviates. Meanwhile, marijuana stock Aphria (APHA) went up and down as the story of the Green Growth Brands takeover took another turn.


Dow Jones Futures Today

Dow Jones futures rose 0.35% vs. fair value. Futures on the S & P 500 are up 0.25%. Nasdaq 100 futures rose 0.3%. IBM is a component of the Dow, thus providing some support for the Dow Jones futures. Remember that overnight action on the Dow futures and elsewhere does not have to be translated into actual trading in the next regular stock market session.

IBM shares

IBM (IBM) beat Q4 estimates and guided higher. Keep in mind that IBM's revenue and revenue dropped compared to the previous year. IBM shares rose 6.5% at the end of trading, but shares were in a multiyear downtrend.

TD Ameritrade, Interactive Income Broker

TD Ameritrade's earnings per share rose 39%, comfortably beating the view. Interactive Broker's income and income misses a little. TD Ameritrade shares rose 2.3% late, signaling a move above the 200-day line. Interactive Broker shares fell 1.8%.

Marijuana Stock: Aphria Haze

Aphria shares listed on the NYSE fell 0.6% in late trading, reversing previous gains. Green Growth Brands made an official offer to Aphria, offering 1.5714 shares of Green Growth (registered in Canada) for Aphria shares. Green Growth made the same takeover offer for Aphria at the end of 2018, which was rejected by Aphria based in Canada too low. The short seller, who had raised doubts about other Aphria transactions, also questioned the relationship of Green Growth with Aphria.

Setback of the Stock Market Rally

The stock market rally suffered the worst setback since 2008 Apple (AAPL) warning of earnings hit the main average on January 3.

Dow Jones on Tuesday fell 1.2%, the S & P 500 fell 1.4%, and the Nasdaq composite lost 1.9%. The Dow and S & P 500 cut their 50-day intraday moving average, but all three indexes closed above that key level. Apple shares, for its part, fell 2.2%, as iPhone makers struggled to even offset the stock market rally.

The stock market fell in part on reports that the Trump administration rejected a proposal for a Chinese trade meeting due to differences in intellectual property rights. White House economic adviser Larry Kudlow told CNBC that no meetings were canceled, helping the stock market reduce losses slightly at closing.

The stock market rally has been pushed in a size not small with hopes for a China trade agreement. Anything that shows the opposite can hurt.

Leaving aside China's trade headlines, the stock market rally has been running with several obstacles. Except for Apple's stock collapse on January 3 – soon followed by the S & P 500 day follow-up – the main average has not experienced a major setback since December 24. Now it's not too fun to experience high-volume sales, but the stock market rally is still valid at the moment. If the main average continues to accumulate distribution days, that will be of greater concern.

The Dow Jones futures rebounded modestly from an encouraging 50-day line, but the actual Dow and leading indices that do it will be more meaningful.


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