Dow Jones futures will open on Sunday evening, along with S&P 500 futures and Nasdaq futures.
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The stock market rally saw a strong rebound over the past week after major indexes and several blue-chip stocks fell to start 2024, but quickly found support at key levels. A large number of stocks triggered buy signals, including a strong breakout from… Nvidia (NVDA).
It was a good time to add exposure.
Nvidia shares are now extended, but fellow AI leader Microsoft (MSFT) is just above the buy point after strong weekly gains, on the cusp of surpassing the market value of fellow giant Dow Jones. apple (Camel). Novo Nordisk (NVO) is still in the buy zone.
Mercadolibre (Millie) and TradeWeb Markets (TW) Entries flash during the day.
On the negative side, Tesla (TSLA) had an ugly week, extending the recent selloff and breaking key support levels amid a flurry of headlines.
Nvidia and NVO stocks are on the IBD Leaderboard. MELI and Microsoft shares are on SwingTrader. MSFT stock is on IBD Long-Term Leaders. Nvidia, MercadoLibre, Novo Nordisk, and Microsoft are in the IBD 50. Microsoft and MercadoLibre are in the IBD Big Cap 20.
The video embedded in the article discussed the weekly action of the market rally and analyzed Microsoft, MercadoLibre, and NVO stocks.
Dow jones futures today
Dow Jones futures open at 6pm EST on Sunday, along with S&P 500 futures and Nasdaq 100 futures.
US stock markets will be closed Monday for the MLK holiday, but other stock exchanges around the world will be open.
Remember, an overnight move in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
Join IBD experts as they analyze leading stocks and the market on IBD Live
Stock market pool
The stock market rally got off to a strong start on Monday and extended gains, although major indexes faced resistance at key levels.
The Dow Jones Industrial Average rose 0.3% in stock market trading last week, after briefly reaching a record high on Friday. Boeing (BA), which fell nearly 13% on 737 MAX issues, capped the Dow’s gains.
The S&P 500 rose 1.8%, hitting a 52-week high and within a few points of its all-time high. The Nasdaq Composite jumped 3.1%, rebounding from the 10-week line but reaching resistance at the 15,000 level.
While the S&P 500 and Nasdaq are near the highs, they are not extending from their 50-day line, suggesting they have room to rise.
The small-cap Russell 2000 index jumped on Monday but closed flat during the week, hitting resistance at the 21-day line. The Invesco S&P 500 ETF (RSP) looks better, holding above its 21-day line near 52-week highs, but is up just 0.2% on the week.
This reflects weak market expansion in 2024 after expanding significantly in late 2023. This is the most notable flaw in the market rally at the moment. But market leadership was widespread.
At this point, the First Trust Nasdaq 100 ETF (QQEW) is up 2.1% for the week. While that lagged the Nasdaq 100’s 3.2% jump, boosted by shares of Nvidia, Microsoft and other giants, it was a strong performance for the QQEW.
The yield on 10-year Treasury bonds fell by 9 basis points to 3.95%, below the 4% level. The two-year Treasury yield, closely tied to Fed policy, fell 25 basis points to 4.14%. Odds of a Fed rate cut have increased following big inflation reports this week.
US crude oil futures fell 1.5% to $72.68 per barrel last week.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF (IGV) rebounded 5.7%, with MSFT stock holding a significant lead. The VanEck Vectors Semiconductor ETF (SMH) rose 4.1%, with NVDA stock the largest value. Both ETFs rebounded from their 10-week streaks.
The SPDR S&P Metals and Mining Fund (XME) fell 1.1% last week. The Global The US Global Jets ETF (JETS) was down 3.25%, falling on Friday Delta Airlines (D) Guidance. Shares of the SPDR S&P Homebuilders ETF (XHB) rose 2.2%. The Energy Select SPDR ETF (XLE) fell 2.4% and the Healthcare Sector SPDR ETF (XLV) rose 1%, its ninth straight weekly gain.
Select Industrial Sector SPDR Fund (XLI) rose 0.6%. The Financial Select SPDR ETF (XLF) fell 0.4%, continuing to trade tightly.
Reflecting more speculative stocks, the ARK Innovation ETF (ARKK) fell 3.1% last week and the ARK Genomics ETF (ARKG) fell 2.9%. Tesla stock is a prime holding across Ark Invest’s ETFs. Cathie Wood bought more TSLA shares on Thursday.
Time the market with IBD’s ETF market strategy
Stocks are in buy zones
MSFT stock rose 5.6% to 388.47 during the week, moving above the 384.30 buy point of a flat base and base on base pattern. During the week, Microsoft rebounded from its 10-week line and cleared some resistance to make early entries.
Microsoft’s valuation briefly surpassed Apple’s on Thursday, but was nowhere near that. Microsoft stock has a market cap of $2.887 trillion. Apple is valued at $2.892 trillion. AAPL stock rose 2.6% last week, rebounding from the 200-day line but below the 50-day line.
NVO stock rose 1.1% on the week to 107.16, rising slightly into buy territory. Unlike most markets, Novo Nordisk stock had a strong first week of 2024. Shares surpassed a flat buy point of 105.69 on January 4. Eli Lilly (LLY) is also in the buy zone.
MELI stock jumped 4.2% to 1,658.58, briefly breaking above a flat 1,660 buy point on a base basis, according to a MarketSmith analysis. During the week, MercadoLibre stock jumped 7.8%, rebounding from a 10-week line and making some early entries.
TW stock rose 3.1% last week to 95.91, rebounding from a 10-week streak. On Friday, shares hit an intraday high of 97, near the firm buy point of 97.18. It is executable above 96.10.
Tesla shares
Tesla is a bad stock, at least for now. The electric car giant has had huge rides and could do so again in the future. But right now TSLA stock is struggling.
Shares fell 7.8% to 218.89 during the week, breaking both its 50-day and 200-day lines. The relative strength line, which tracks the stock’s performance against the S&P 500, is at its lowest levels since May.
Last week, Tesla cut prices in its strongest markets and announced plans to suspend production at its Berlin factory for two weeks. while Hertz (HTZ) is getting rid of many of its electric cars at discounted prices, especially Tesla cars. The car rental giant cited weak demand and high repair costs.
What are you doing now
The market rally was behaving wonderfully. Stocks sold off to start 2024, but the pullback was modest as the S&P 500, Nasdaq Composite and blue-chip stocks found support where you’d expect. The pullback was enough to quickly form some pullbacks and bullish handles, but not so deep as to cause serious damage.
Investors could have held on to the early selling or taken some profits. Either way, there have been a number of opportunities to add exposure over the past week.
At the same time, a number of stocks are creating new consolidations, often at or above deep bases. So keep working on your watch lists.
Read The Big Picture every day to stay on top of market trend and leading stocks and sectors.
Please follow Ed Carson on Threads at @edcarson1971, and X/Twitter at @IBD_ECarson And Bluesky at @edcarson.bsky.social for stock market updates and more.
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