Stock futures were once again mixed on Friday, as global markets advanced, following positive comments from President Joe Biden and a key banking rule change from the Federal Reserve on Thursday. China-based names ran high across the market in early trade. A rebounding Nike led the Dow Jones today, even as China amplified its reaction to corporate pressure on labor practices in Xinjiang.
Dow Jones futures swung 0.5% above fair value, while S&P 500 futures added 0.3%. Nasdaq 100 futures slunk 0.2% lower, as modest losses from Tesla (TSLA), Facebook (FB) and Microsoft (MSFT) weighed on early trade. Markets will have an ear tuned to a spate of early economic data, with February import/export numbers, personal income and spending and retail inventories all due out before the open.
Baidu topped the Nasdaq 100, up 6.7%, as United Airlines (UAL) posted a 2% gain and China-based stocks held four of the index’s top five early advances. Energy, travel and materials issues ran high on the S&P 500. Norwegian Cruise (NCLH) and Carnival (CCL) led, up about 3% apiece.
Aspira Womens Health (AWH) rose more than 7%. The low-priced stock is trading below a 9.27 buy point in a cup-with-handle base.
On The Radar: VipShop, Tencent Music, Elite Education
China-based stocks led the IBD 50 list in early trade. VipShop Holdings (VIPS) popped 6%, 360 Digital (QFIN) leapt 5%, each rebounding from sharp dives. Taiwan Semiconductor (TSM) gained 2%, as it looks to stopper a six-week drawdown.
Elite Education Group International (EEIQ) is a stock to watch on Friday, trading 372% higher in premarket action. The Ohio-based company “facilitates study-abroad and post-study services for Chinese students in the U.S.,” according to the Dayton Business Journal. The stock priced at 8 and closed at 4 in its first day of trade on Thursday.
Dow Jones Today: Nike, Banks Lead
Nike (NKE) jumped 1.6%, leading the upside on the Dow Jones today. Baird upgraded the stock to outperform after holding steady at a neutral for the past two years. The price target was unchanged at 150, and the note projected that current supply chain and China market concerns were temporary.
China state media launched a boycott threat against several companies, led by Nike and Sweden’s H&M (HNNMY), which had stopped purchasing cotton sourced in China’s Xinjiang region. Multiple investigations found evidence of state-run concentration camps and forced labor among the region’s Uyghur minority. China state and media sources on Thursday threatened a boycott in the country that generates 19% of Nike revenue.
Nike stock fell as much as 6% on Thursday, recovering to a 3.4% loss at the close. The chart damage fractured a basing effort underway, stopping just short of a test of support at its 200-day line.
JPMorgan Chase (JPM) and Goldman Sachs (GS) each rose about 1%, trading high on the Dow jones today. The Federal Reserve on Thursday announced that big financial firms including JPMorgan Chase and Bank of America(BAC) can start buybacks and dividend hikes beginning on June 30, after first passing the latest round of stress tests. Previously, the Fed had said those higher shareholder returns could start in the first quarter.
Both stocks are extended, with Godman Sachs working on its fifth, JPMorgan on its sixth, consecutive monthly advance.
Market Vital Signs: Bonds, Bitcoin, Oil
Stock markets across Asia rallied Friday, ending the week on a positive note as global markets responded, in part, to the Fed’s updated bank rules and positive comments from President Biden on Thursday. Benchmarks in Europe traded moderately higher near mid-session, with the FTSE 100 in London and Germany’s DAX each showing 0.6% gains.
Bonds extended Thursday’s rebound, with the 10-year Treasury yield up 2 more basis points to 1.66%. Yields have staged a quick rise from the pandemic’s record lows around 0.50% in August. They approached pre-pandemic levels late last week, climbing above 1.75% — the highest level since January 2020. Yields had started 2020 at around 1.8%, which was down from about 2.7% a year earlier.
Cryptocurrency stocks ran higher as Bitcoin edged to above $53,000, after dipping below $51,000 on Thursday, according to CoinDesk. The cryptocurrency climbed to a record high at $61,556 on March 13.
Oil prices continued to bob wildly, rising sharply early Friday, as markets grappled with a global oil supply chain pinched by a cargo ship grounded and blocking the mouth of the busy Suez Canal in Egypt, the daily conduit for 10% of the world’s seaborne oil supply. West Texas Intermediate jumped 2.3%, back above $59 a barrel. At the end of trade on Thursday, WTI was down 4.7% for the week, and tracking toward a third weekly decline.
Find Alan R. Elliott on Twitter @IBD_Aelliott
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