Dow Jones Futures Dip, S&P 500 Futures and Nasdaq Futures Follow Suit
Dow Jones futures, as well as S&P 500 futures and Nasdaq futures, experienced a slight decrease overnight, suggesting a cautious start to the day for investors.
Stock Market Takes CPI Inflation Report in Its Stride, Big Techs Lead
Despite a higher-than-expected core CPI inflation reading, the stock market rally saw big-cap tech stocks, such as Oracle and Nvidia, leading the way to an all-time high for the S&P 500. However, market breadth remained weak.
Stocks on the Rise: ServiceNow, Shockwave Medical, Archrock, Symbotic, and Microsoft
Some notable stocks, including ServiceNow, Shockwave Medical, Archrock, Symbotic, and Microsoft, flashed buy signals on Tuesday, presenting investors with potential opportunities for incremental purchases. However, the window for such buying opportunities may be short-lived.
Upcoming: Dollar Tree and Williams-Sonoma
Investors eagerly await the performance of Dollar Tree and Williams-Sonoma on the market today.
Stocks on the Radar: Nvidia, ServiceNow, Shockwave, and More
Nvidia and ServiceNow stocks can be found on IBD Leaderboard and SwingTrader, respectively. Microsoft stock is listed on IBD Long-Term Leaders. Nvidia, Symbotic, and Shockwave stock make appearances on the IBD 50, while Archrock is hailed as the IBD Stock of the Day.
Today’s Dow Jones Futures
Dow Jones futures have seen a fractional decline compared to fair value. S&P 500 futures are slightly lower, and Nasdaq 100 futures have fallen by 0.1%. However, it’s important to note that overnight market activity does not always dictate actual trading in the upcoming stock market session.
Market Rally Shows Strength
Despite the release of generally high CPI data, the stock market rally had a strong session. There are indications in the data that the core PCE price index favored by the Federal Reserve, the central bank, may present a more moderate reading. Big tech stocks like Nvidia, Oracle, ServiceNow, Microsoft, and Meta Platforms led the rebound.
The Dow Jones Industrial Average climbed 0.6%, reclaiming the 39,000 level and rising from both the 21-day and 10-week moving averages. The S&P 500 index reached a new closing high, gaining 1.1% off the 10-day line. The Nasdaq composite experienced a 1.5% jump, rebounding from the 21-day line and nearing a closing high.
It’s worth noting that despite these gains in the major indexes, decliners slightly outnumbered advancers. The small-cap Russell 2000, although it experienced a marginal decline, maintains its upward trend.
ETFs in Focus
Growth ETFs such as the iShares Expanded Tech-Software Sector ETF and the VanEck Vectors Semiconductor ETF made significant gains, reflecting the rebound in the respective sectors. The iShares Expanded Tech-Software Sector ETF hosts major holdings like Microsoft, Oracle, and ServiceNow, while the VanEck Vectors Semiconductor ETF holds Nvidia stock as its top position.
ARK Innovation ETF and ARK Genomics ETF, both representing more speculative story stocks, experienced slight declines. On the other hand, several other ETFs, including SPDR S&P Metals & Mining ETF, Global X U.S. Infrastructure Development ETF, U.S. Global Jets ETF, SPDR S&P Homebuilders ETF, Energy Select SPDR ETF, and Health Care Select Sector SPDR Fund, made positive moves.
Certain ETFs, like Industrial Select Sector SPDR Fund and Financial Select SPDR ETF, also made modest gains, with Financial Select SPDR ETF approaching its all-time highs from early 2022 (excluding the COVID-19-induced stock market crash), but the SPDR S&P Regional Banking ETF faced a slight decline.
Stocks in Buy Zones
ServiceNow stock showed impressive gains, rebounding from the 50-day and 21-day lines and breaking its downtrend. This indicates the emergence of a valid flat base in the stock, presenting an early entry opportunity.
Shockwave stock continued its upward trajectory, breaking through the trendline of a short consolidation following a rebound from the 21-day line. This movement provides an early entry point for the stock. Additionally, a three-week tight pattern adds further strength to the recent action.
Symbotic stock also witnessed positive movement, as it bounced back from the 50-day line and attained convergence with other moving averages. Investors may consider a trendline entry, with the March 8 high acting as a specific trigger, keeping in mind the stock’s volatility.
Microsoft stock exhibited a rebound from the 10-week line, regaining the 21-day line, and presenting an early or add-on entry opportunity. However, the stock has yet to break a trendline in its emerging flat base, and investors may prefer to wait for further progress around the 416-417 level.
Archrock stock continued its positive trend, extending Tuesday’s bounce from the 21-day moving average and surpassing a short trendline. This development provides an early entry opportunity. The stock’s ascending base and an official buy point around 19.42, as per the daily chart on MarketSurge, make Archrock an attractive prospect in the natural gas services sector.
Nvidia Stock Remains Stretched
Nvidia stock experienced a significant jump, bouncing from the 10-day moving average with above-normal volume. The stock had exhibited a decline of 2% on Monday, following a substantial downside reversal in high volume on Friday. Given its current position, being 35.6% above the 50-day line, the stock remains significantly extended.
What to Consider
The market rally’s resilience has made it challenging for new bases to form, particularly in AI chip names like Nvidia that have significantly outperformed in recent months. However, other sectors, such as software, medical products, and energy, showcase potential new bases. Although these stocks have displayed relative strength, some have experienced prior upward trends, which may have affected their relative strength lines.
Investors should remain vigilant and prepare watchlists that go beyond the hottest names at the moment. The key is to identify emerging opportunities before they become too extended. Regularly reviewing The Big Picture will help investors stay informed of current market trends, leading stocks, and sectors.
For more stock market updates and insights, follow Ed Carson on Threads at @edcarson1971 and on Twitter at @IBD_ECarson.
Reminder: This news article has been curated with information from various credible sources and has been crafted with a natural writing style to ensure a seamless reading experience.
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