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Dow Jones Flat, Nasdaq 100 Off 0.6%; Will These 4 Big Growth Stocks Beat The S&P 500 In July?

The stock market today reasserted a desire by investors to continue loading up on stocks, but a late-hour reversal tossed water on the mild rally. The Dow Jones Industrial Average at one point gained as much as 0.4%, helped by a 16-point rebound by aerospace leader Boeing (BA), before backtracking. The Nasdaq 100 fell 0.6%.

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At around 3:30 p.m., the S&P 500 edged slightly nearly 0.4% lower; volume fell vs. the same time on Thursday on the Nasdaq but tilted a bit higher on the NYSE. The Russell 2000 eased almost 0.2%.

Boeing rose to three-week high in fast turnover. Late Thursday, the company said it's taking a $4.9 billion charge in the second quarter due to the grounding of the 737 MAX passenger jets since March. Boeing still has a long way to go in forming the right side of a potential new base. Results are due Wednesday before the open.

Keeping Weekly Losses Tidy

After rising 1.2% and 1.5% in the prior two weeks, the 30-stock Dow Jones industrials cut this week's loss to around 0.1% in early afternoon trade. Ditto for the Nasdaq composite. The tech-stuffed index, up 1.9% and 1% in the prior two weeks, had shaved a 1.3% early loss for the week to less than 0.3%. But in late-afternoon trading, the Nasdaq composite looked set to fall around 1%.

Such weekly action is exactly what you want to see during a stock market in confirmed uptrend.

When did the new uptrend begin?

June 7 marked a Day 4 follow-through by the Nasdaq composite. It rallied 1.7% that day as volume increased modestly vs. the prior day. Most good follow-through rallies occur on the fourth day of a new rally attempt or later.

Not all follow-throughs are successful. But IBD research finds that all of the major market bottoms featured a follow-through.

Read this June 7 Big Picture column for detail on how the latest follow-through arose.

Beyond The Dow Jones: New IPO Breakout

Meanwhile, business software remained a key theme for stock market bulls.

Sunnyvale, Calif.-based CrowdStrike (CRWD) blasted more than 14% higher and hit a new high of 85.85. The big move constituted a breakout past an initial IPO base with a 79.89 buy point. IPO bases carry more risk, in part because they can often form over a very short time frame. But IPO bases also offer big profit opportunities.

While the cloud-based data security expert posted a terrific sales gain of 103% to a record $96.1 million for the April-ended fiscal first quarter. That follows top-line increases of 77%, 109%, 149% and 108% in the prior four quarters. However, CrowdStrike also posted a net loss of 13 cents a share in Q1, 4 cents than the 17 cents it lost per share a year ago.

CrowdStrike has 199 million shares outstanding and a market value of $16.6 billion.

Four other business software companies, including two in CrowdStrike's security software industry group, hold a spot in IBD Leaderboard.

Other small, mid- and large-cap growth stock leaders doing well this year include:

PagSeguro Digital (PAGS): The IBD 50 stock and payments technology firm, based in Brazil, has rallied 45% since it drove out of a large cup with handle and a 31.74 correct buy point.

Since the stock is extended, wait for a new base to form.

Since the breakout, PagSeguro has refused to pull back to its 10-week moving average. That signifies uncommon stock strength.

According to IBD Stock Checkup, PagSeguro scores a 99 Composite Rating on a scale of 1 (a dud) to 99 (a star). The rating analyzes fundamental, technical and fund ownership characteristics. The company also ranks at the top in this score within the credit and debit card payments group.

This Leading Retailer Is Basing

Five Below (FIVE): The innovative discount retail chain, up a second straight day, is forming a new base. Wall Street sees fiscal 2020 profits growing 23% to $3.17 a share.

Earlier this year, IBD noted that the company has weighed raising prices on some items to above $5 due to higher prices caused by U.S. tariffs on Chinese imports.

Please read this January story on how to analyze Five Below action on a long-term chart.

Heico (HEI): The jet engine and aircraft components firm has acted bullishly since it soared past a 107.55 entry point in a 3 weeks tight on May 29.

Innovator IBD 50 (FFTY) fell a penny to 35.83, keeping a solid gain of 4.5% since July 1.

Please follow Chung on Twitter at both @SaitoChung and @IBD_DChung for more on growth stocks, chart analysis, breakouts and sell signals.

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