Dow Jones futures rose early Friday, along with S&P 500 futures and Nasdaq futures. from Broadcom (AVGO) And Lululemon Athletica (Lulu) earnings headlines late Thursday with the jobs report shown before the open. Tesla is looking to continue trying to break through on Thursday.
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The Senate passed debt ceiling legislation Thursday night, sending it to President Biden for his signature, avoiding a default in the United States for the first time.
The stock market rally had a strong session on Thursday. After starting mixed, the major indices should rebound and move higher, although they pared gains near the close. Market breadth was strong. Many stocks made upward moves while some early profit losers came back. Falling Treasury yields and dollar weakness provided a boost.
Tesla (TSLA) Stocks are trying to break out, while arch-rival BYD (I will) just below the point of purchase. wing stop (wing), Fluence (FLNC) And Uber Technologies (Uber) are all close to the entrances.
In addition to Broadcom and LULU shares, Zscaler (ZS), Asana (Asan), samsara (The Internet of things), The guard is one (s), MongoDB (mdb) reported late.
lululemon. Samsara and especially MDB shares were big after-hours earnings winners. ASAN shares rose as well. SentinelOne stock collapsed overnight, while Zscaler and AVGO stocks fell modestly. ZS, Asana, and Samara stocks closed near buys or early entries.
WING stock has been added to IBD Leaderboard Thursday. MDB, Fluence, Wingstop, and Uber stocks are in defect 50. Wingstop was Thursday’s stock from IBD. FLNC stock was Tuesday’s pick.
Jobs report
Economists expect the May jobs report to show nonfarm payrolls rising by 180,000, down from 253,000. The unemployment rate should rise from its long-term low to 3.5%. Average hourly earnings should rise 4.4% versus a year earlier, flat with April.
Other labor data this week has been strong, including job openings for April and the ADP employment report for May. But there are other indications that labor markets are not as tight as previously thought.
The jobs report will influence the outlook for the Fed’s June meeting. The odds of a rate hike decreased on Wednesday as two Federal Reserve officials indicated they would favor a pause this month. Markets now see a 77% chance of being paused.
Dow jones futures today
Dow futures rose 0.5% against fair value. S&P 500 futures rose 0.5% and Nasdaq 100 futures rose 0.4%. AVGO stock is a notable S&P 500 and Nasdaq 100 stock. So does Tesla.
Crude oil jumped more than 1% and copper futures rose about 2%.
Remember that overnight action in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
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Stock market rise
The stock market rally consolidated for most of the session, before pulling back in the last 45 minutes.
The Dow Jones Industrial Average rose 0.4% in stock market trading Thursday. The S&P 500 rose 1%. The Nasdaq Composite Index rose 1.3%. Small cap Russell 2000 rose 1.05%.
US crude oil prices rebounded about 3% to $70.10 a barrel. Copper prices rebounded by 2.1%. Strong Chinese economic data and a weak US dollar helped commodity prices.
The 10-year Treasury yield fell 3 basis points to 3.61%, down 21 basis points so far this week.
Exchange Traded Funds
Among the ETFs, the Innovator IBD 50 ETF (fifty) rose 1.3%. iShares Expanded Technology and Software ETF (IGV) lost a small part. Sentinel One, Asana, and ZS stocks are on IGV. VanEck Vectors Semiconductor Corporation (SMH) gained 1.5%. AVGO stock is a big SMH component.
Reflecting more speculative stories, the ARK Innovation ETF (ARK)ark(up 1.5% and the ARK Genomics ETF)ARKG) figured 2.9%. Tesla stock is the number one stock ETF held by Ark Invest. Cathie Wood’s Ark also owns some shares of BYD.
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Tesla stock
Tesla stock rose 1.8%, to 207.52. During the day, stocks reached 209.80, briefly clearing 207.89 buy points from any cup or double bottom. Notably, TSLA stock has advanced above-average trading volume for four straight sessions, after a few such days in the previous three months.
Stocks rallied slightly early on Friday, indicating that the breakout attempt may continue.
There was speculation that Elon Musk would unveil a revamped Model 3 at the Shanghai factory on Thursday, but he hasn’t. Meanwhile, Tesla is increasing discounts on US inventory, opting not to cut official prices for now.
Meanwhile, BYD stock rose 2% to 30.80 on Thursday, back toward a 31.17 cup handle buy point initially cleared on May 10. The Chinese electric car price war took a heavy toll earlier in 2023.
Other stocks near buy points
FLNC shares fell 2.4 percent to 24.20. The shares are just below the buy point of the handle 24.87, but this week they traded above an early entry from the handle’s downtrend break. Fluence Energy operates in the field of storage on a large scale. Fluence uses CATL batteries, as does the commercial Megapack. Not yet profitable, but revenue growth is booming.
WING shares fell 0.3% to 198.44. Wingstop found support at the 10-week line this week, just above a previous buy point. Shares will be executable above Wednesday’s high of 202.43. It will also lift WING stock above the 21-day line and break a downtrend in a short consolidation. Wingstop stock is on track to have a firm footing by Friday’s close.
UBER rose 1.45% to 38.48, rebounding from the 21-day line. Technically, the transportation services giant is in the range of a cup bottom with 37.68 buy points, according to MarketSmith analysis. Investors can buy Uber shares here, or wait for more strength to break a short downtrend. Uber is an example of a stock that is going straight up from the bottom of its base. Downtime over the past month has been building.
Market rally analysis
Big-cap tech companies led the stock market rally on Thursday, but it was a broad advance. The Nasdaq rose below Tuesday’s nine-month high, closing at its best level since mid-August. The S&P 500 set a new high in 2023.
The Dow Jones tested the 200-day line, but bounced back to the upside. It is still below the 50-day line. Russell regained his 2000 50-day average, but must return to the 200-day average.
The market breadth was solidly positive on Thursday, with the winners leading the losers by more than 2 to 1. However, new lows were comfortably outpaced by new highs.
First Trust Nasdaq 100 Equal Weighted Mutual Fund (QQEW) rose 0.7%, trailing the Nasdaq 100’s 1.2% gain, but matching its 52-week closing high.
Invesco S&P 500 Equal Weight Fund (RSP) rose by 0.75%, but it is still below the major moving averages. The RSP, along with the Russell 2000, reflects the broad advance on Thursday but also the weak range over the longer term.
A few stocks broke, but aside from Tesla it extended from the moving averages. There were a few additional buys or swing trades such as Celsius (CELH), but you had to be quick.
Many of the names of AI, chips, and software that have pioneered the market could use the rest. Some were stretched out considerably, while others ran straight from the bottom of the bases, but could use some drastic measures around points.
We hope that other sectors can join and expand the market leadership, such as biotechnology, medical products, travel, and homebuilders. For that to happen, the market rally needs to see a steady diet of broad advances.
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What are you doing now
Market action on Thursday was positive, but it was only one day. Driving is still narrow and wide.
There was not a lot of buying opportunity on Thursday. Some stocks need relief, while others need to rally. Let those devices evolve. Don’t try to get your way to a higher exposure by buying extended shares or other shares that are not in a position yet.
Instead, you should follow these leaders and potential leaders. Keep your watchlists updated, focusing on stocks that are close to actionable and have high potential.
Market exposure should be modest. If the market continues to rally broadly, there will be plenty of opportunities to gradually increase the size of your portfolio. On the flip side, be prepared to expand should individual holdings or the broader market weaken.
Read the big picture every day to stay in sync with market trend, leading stocks and sectors.
Please follow Ed Carson on Twitter at @employee For stock market updates and more.
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