Dow Jones futures opened Sunday night, with S&P 500 futures and Nasdaq futures also focusing on Nvidia.
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In the stock market rally, the Dow Jones, S&P 500 and Nasdaq hit record highs over the past week, with many stocks breaking out or issuing other buy signals. Stocks paused late in the week, but the Dow Jones Industrial Average closed above $40,000 for the first time on Friday.
Nvidia (NVDA) earnings are expected to be released on Wednesday night. The AI chip leader’s results and guidance will have a huge impact on other artificial intelligence efforts and have a major impact on the broader market rally.
Nvidia stock entered a buy zone last week. AI plays broadcom (AVGO), microsoft (MSFT), super microcomputer (SMCI) And perhaps, Advanced Micro Devices (AMD) are all near buy points.
I’ll report back next week: PDD Holdings (PDD), palo alto networks (PANW), modine manufacturing (mod), toll brothers (Thor), synopsis (SNPS), deckers outdoor (deck) and williams sonoma (WSM).
PDD, the parent company of Pinduoduo and Temu, is already in buy range, along with luxury builder Toll Brothers. Modine Manufacturing, Synopsys, Deckers, and Williams-Sonoma are near buy points. As the city of Palo Alto works to build new locations, Monday night’s results also have implications for other cybersecurity strategies, including: cloud strike (CRWD).
Nvidia stock is listed on the IBD Leaderboard. AVGO stock and his Nvidia are on SwingTrader. Microsoft stock and Synopsys are on IBD’s long-term leaders list. Nvidia and PDD stocks are included in the IBD 50. Nvidia, Broadcom, and SMCI stocks are included in the IBD Big Cap 20.
Dow Jones futures today
Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, open at 6pm ET on Sunday.
Please note that overnight trades such as Dow futures do not necessarily translate into actual trades in the next regular stock market.
IBD experts analyze leading stocks and markets on IBD Live.
Stock market rise: Dow Jones Industrial Average exceeds 40,000 points
The stock market’s rally was helped by other economic indicators that suggested a slowdown or slowing of inflation. The major indexes rose sharply on Wednesday, but paused in the second half of the week to wait for Nvidia’s move.
In stock market trading last week, the Dow Jones Industrial Average rose 1.2% to end the week at just over $40,000. The S&P 500 index rose 1.5%. The Nasdaq Composite rose 2.1%. The small-cap Russell 2000 rose 1.7%. The Dow Jones is on a five-week winning streak, while other indexes have been up for the past four weeks.
Many sectors are showing strength, including homebuilders and related stocks, various financial, medical and energy businesses, aerospace, specialty footwear, restaurants, and global e-commerce companies.
The yield on the 10-year U.S. Treasury fell 8 basis points to 4.42%, far from its weekly low of 4.32%.
Last week, U.S. crude oil futures rose 2.3% to $80.06 per barrel.
ETF
Among growth stock ETFs, the iShares Expanded Technology Software Sector ETF (IGV) rose 3.5%. Microsoft stock, along with Palo Alto, is a major component of IGV. The VanEck Vector Semiconductor ETF (SMH) rose 3.1%. Nvidia stock is SMH’s No. 1 holding, with AMD and Broadcom also being key members. SNPS stock is in both his SMH and IGV.
The SPDR S&P Metals Mining ETF (XME) rose nearly 4% last week. The Global XUS Infrastructure Development ETF (PAVE) fell nearly 1%. The U.S. Global Jets ETF (JETS) rose 1.7%. SPDR S&P Home Builders ETF (XHB) fell 0.3%. Energy Select SPDRETF (XLE) rose 1.2% and Healthcare Select Sector SPDR Fund (XLV) rose 1.9%.
The Industrial Select Sector SPDR Fund (XLI) fell 0.3%. Financial Select SPDR ETF (XLF) rose 1.5%.
Reflecting more speculative story stocks, the ARK Innovation ETF (ARKK) rose 5.9% and the ARK Genomics ETF (ARKG) rose 6.6% last week.
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Nvidia’s revenue
The semiconductor giant reported on Wednesday night. Analysts expect Nvidia’s earnings to jump 412% to $5.58 per share and revenue to rise 245% to $24.51 billion.
Even if Nvidia beats views and raises its guidance again, will that be enough to meet investor expectations?
NVDA stock rose 2.9% last week to 924.79. The stock cleared the Cup with Handle buy point at 922.20 on Wednesday and fell back to test that entry on Friday.
Other AI
Broadcom stock rose 4.7% last week to 1,395.29, according to MarketSurge, and at one point broke above the buy point at 1,438.17. The stock did rise above its initial entry of 1,403.98, but fell below that level on Friday.
AMD stock rose 8.25% for the week to 164.46, but hit resistance at the 50-day slide line. If they can clear this area decisively, they may be able to enter aggressively, but AMD has been lagging behind Nvidia and many others in the AI battle in recent months. Microsoft’s Azure will reportedly offer cloud computing customers the option to run AMD’s AI processors. This sent AMD stock higher on Friday morning, but the stock price growth slowed.
Microsoft stock rose 1.3% for the week to 420.21, moving off its 50-day line and toward a sideways buy point at 430.82. Investors could use a move above Thursday’s high of 425.24 as an early entry into the Dow Jones giant, matching the trend line.
Supermicro shares jumped 11.2% for the week to 887.89, just below its 50-day line. Investors could take advantage of this decisive clearing of the field as an early entry into the AI server maker.
Taking a new position in any of these names before Nvidia is profitable is extremely risky.
Of course, this is just one example of AI that could be affected, and everything from chips and software to thermal cooling companies like Modine Manufacturing and utilities. constellation energy (CEG).
Timing the Market with IBD’s ETF Market Strategy
what to do now
After hitting record highs, the stock market rally is taking a breather. This allows the stock to train the handle or move to the right side of the base to flex relative strength.
The past two weeks have been a steady stream of buying opportunities, and that has largely worked. Investors should currently have material or severe exposure.
Be wary of buying AI stocks ahead of Nvidia’s profits. Nvidia’s performance can have a significant impact on the overall market, so think carefully when increasing your overall exposure.
This is a good time to review your portfolio. Are there any laggards that can be removed to make room for additional or new purchases? Too interested in AI stocks?
Be sure to work on your watchlist. Many stocks across a wide range of sectors are rising again.
Read “The Big Picture” daily to stay on top of market direction and leading stocks and sectors.
Follow Ed Carson’s thread @edcarson1971 and X/Twitter. @IBD_ECarson The latest information on the stock market, etc.
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