U.S. equities are suffering a rare bout of weakness on Friday, which is set to break the Dow Jones Industrial Average’s 10-day winning streak — matching the record from 1987 for the best-ever run for the index since its inception.
Narrow breadth, extended sentiment and weakness in other areas of the market, such as Treasury yields, have cast a pall over the uptrend. And now, finally, the bears are showing some signs of life as a growing number of mega-cap heavyweights within the Dow roll over amid rising selling pressure.
Here are three to watch:
Dow Titans in Trouble: Exxon (XOM)
Exxon Mobil Corporation (NYSE:XOM) shares are threatening to break below critical support near the $81-a-share level, down some 12% from their post-election high, as oil prices look vulnerable to a selloff on bloated U.S. inventories, increasing U.S. shale production, and the realization that a more energy-friendly occupant in the White House is likely to increase U.S.-based output and thus, further increase market oversupply.
The company will report results on May 2 before the bell. Analysts are looking for earnings of 89 cents per share on revenues of $69.1 billion. Edge Pro subscribers are holding a position in the XOM March $81 puts.
Dow Titans in Trouble: Caterpillar (CAT)
Caterpillar Inc. (NYSE:CAT) shares are threatening to break down below their 50-day moving average after stalling at double-top resistance near the $100-a-share level.
CAT, along with many heavy machinery stocks, got a big boost following the election on hopes President Trump’s infrastructure plans and mining deregulation would be a boon to the sector. But now, as faith dims somewhat as the legislative process grinds on, profit-taking is underway.
The company will next report results on April 27 before the bell. Analysts are looking for earnings of 59 cents per share on revenues of $9.1 billion.
Dow Titans in Trouble: General Electric (GE)
General Electric Company (NYSE:GE) shares have been pushed back below their 200-day moving average after a short-lived breakout attempt was reversed.
Shares have been stalled in a sideways consolidation range since late 2015 and continue to show no signs of vitality here despite the Dow’s impressive post-election surge.
The company will next report results on April 21 before the bell. Analysts are looking for earnings of 18 cents per share on revenues of $26.5 billion.
Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. A two-week and four-week free trial offer has been extended to InvestorPlace readers.
