Soaring Margin Debt Raises Concern; Bitcoin, Five Stocks In Focus

Dow Jones futures will reopen Sunday evening, along with S&P 500 futures and Nasdaq futures, after the stock market rally showed resilience last week. The Bitcoin price traded at fresh record highs Saturday.

Solar IPO Shoals Technologies (SHLS), 5G chipmakers Qorvo and MaxLinear (MXL), Dow Jones giant Microsoft (MSFT) are all near buy points, with SHLS stock and Microsoft already actionable and Apple supplier Qorvo (QRVO) arguably so. We’ll also take a look at Tesla (TSLA), which continues to test key levels.

The Dow Jones actually edged higher last week while the S&P 500 and S&P 500 fell modestly, rallying off short-term support. Growth stocks, especially more speculative names, suffered significant to sharp losses, though they generally rebounded on Friday. Metals, miners and financial stocks were strong performers.

Still, the recent action highlights the need for proper entries and sound sell rules. The problem with such a strong stock market rally is that it’s a bad teacher. Just like an easy A, everyone enjoys easy money. But if you learn the wrong lessons from the past 10 months, then that easy money will go away quickly.

While the Nasdaq is no longer extended, margin debt and investor exposure overall is a growing concern.

Why This IBD Tool Simplifies The Sear ch For Top Stocks

Tesla stock and Microsoft are on IBD Leaderboard. MSFT stock is on IBD Long-Term Leaders. SHLS stock is IBD Stock Of The Day. MXL stock is the focus of a recent IBD Stock Analysis column.

Dow Jones Futures Today

Dow Jones futures will open at 6 p.m. ET Sunday, along with S&P 500 futures and Nasdaq 100 futures.

Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.

Join IBD experts as they analyze actionable stocks in the stock market rally on IBD Live.

Coronavirus News

Coronavirus cases worldwide reached 111.49 million. Covid-19 deaths topped 2.46 million.

Coronavirus cases in the U.S. have hit 28.65 million, with deaths above 509,000.

Stock Market Rally Last Week

The stock market rally had a mixed week, with a mini-rotation from growth stocks into cyclicals and financials.

The Dow Jones Industrial Average edged up 0.1% in last week’s stock market trading. The S&P 500 index dipped 0.7%. The Nasdaq composite retreated 1.6%, but bounced somewhat from its 21-day exponential moving average.

Growth stocks were roughed up in the middle of the week, but Friday gains helped limit losses overall.

Among the best ETFs, the Innovator IBD 50 ETF (FFTY) dipped 0.6% last week, thanks to a 2.15% pop on Friday. The Innovator IBD Breakout Opportunities ETF (BOUT) edged down 0.2% last week. The iShares Expanded Tech-Software Sector ETF (IGV) fell 1.4%. Microsoft stock is the top IGV holding. The VanEck Vectors Semiconductor ETF (SMH) lost 0.3%, with QRVO stock a component.

Losses were heavier in more-speculative names. ARK Innovation ETF (ARKK), which owns Tesla stock and many others, slid 2.5%, even with a 2.3% bounce Friday. ARK Genomics Revolution ETF (ARKG) retreated 4.1% last week, with several key holdings taking big hits.