Dow Jones futures will begin trading Sunday evening, along with S&P 500 futures and Nasdaq futures.
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Nasdaq rebounds after hitting 18,000; focus on Uber, JP Morgan, Hilton
The stock market rally last week sent out some mixed signals. Still, on a weekly basis, the major indexes are showing tight moves and the Nasdaq’s power trend is alive and well.
Meta Platform (Meta), Amazon (AMZN) and Tesla (TSLA) rose during the week but encountered resistance on Friday. NVIDIA (NVDA) and other chip leaders retreated but generally maintained their footing.
Software continued to perform well on Friday, App Lovin (App), Monday (MNDY) and Service Now (Right now) we are in a flashing buy signal.
Nvidia shares, Amazon shares and Meta shares are on the IBD Leaderboard. Amazon shares and Meta shares are on SwingTrader. Nvidia, Monday.com and ServiceNow shares are on the IBD 50. AppLovin was Friday’s IBD Stock Of The Day and Amazon shares were Thursday’s pick.
Dow Jones Futures Today
Dow Jones futures will begin trading at 6pm ET on Sunday, along with S&P 500 futures and Nasdaq 100 futures.
Remember that overnight movements in Dow futures or any other stocks do not necessarily translate into actual trading in the next regular stock market session.
China EV Sales
Investors will get June and second-quarter sales figures from Chinese EV makers Nio (NIO), Lee Auto (LI), XPeng (XPEV) and Zeekle (ZK) Early Monday morning, likely from a major EV and battery company BYD (BYDDF).
Tesla and Rivian (RIVN) is due to release the figures early on Tuesday.
IBD experts break down major stocks and markets on IBD Live.
Stock market rise
The stock market rally was a bit bumpy and ultimately ended up modestly mixed. The Dow Jones Industrial Average was down 0.1% last week in the stock market after a strong start to the week. The S&P 500 was down 0.1% and the Nasdaq Composite was up 0.2%, both of which had rebounded from record highs hit on Friday morning.
The small-cap Russell 2000 rose 1.3%, reclaiming its 50-day line.
The Invesco S&P 500 Equal Weight ETF (RSP) fell 0.8% for the week, finishing just below its 50-day average.
The First Trust Nasdaq 100 Equal Weighted Index ETF (QQEW) fell 0.6%, but is still just below its all-time high.
Friday was a tough day for many growth stocks, but software continued to perform well. Financials and industrials both started the week strong but fell overall. JPMorgan Chase (JPM) signaled early entry on Friday.
Looking at the weekly chart, the Nasdaq has not shown any real weakness, rising for the past four weeks and nine of the past 10 weeks.
The Nasdaq is 5.9% above its 50-day line and has been rising slightly despite sideways movement over the past few weeks. A longer pause or a gradual pullback would be constructive and could help stocks stabilize and open up more room for the next upswing.
A decisive move above the 50-day lines for the Russell 2000, RSP and several major non-tech sectors would be positive.
The 10-year Treasury yield rose 9 basis points to 4.34%. U.S. crude oil futures rose 1% last week to $81.84 a barrel, continuing a recent upward trend.
ETF
Among growth ETFs, the Innovator IBD 50 ETF (FFTY) fell 0.4% last week.
The iShares Expanded Tech-Software Sector ETF (IGV) rose 2.4%, its fourth consecutive week of strong gains. ServiceNow and AppLovin are among IGV’s holdings. The VanEck Vectors Semiconductor ETF (SMH) fell 1.6%, but recovered somewhat from its lows. Nvidia shares dominate SMH’s holdings.
Reflecting stocks with speculative stories, the ARK Innovation ETF (ARKK) rose 1.4% last week, while the ARK Genomics ETF (ARKG) fell 3.5%, back to its April lows. Tesla shares are the No. 1 holding in the Ark Invest ETF.
The SPDR S&P Metals & Mining ETF (XME) rose 0.5% last week. The Global X US Infrastructure Development ETF (PAVE) fell 1.1%. The US Global Jets ETF (JETS) fell 0.25%. The SPDR S&P Homebuilders ETF (XHB) fell 1.7%.
The Energy Select SPDR ETF (XLE) rose 1.6%, while the Health Care Select Sector SPDR Fund (XLV) fell 0.7%.
The Industrial Select Sector SPDR Fund (XLI) fell 0.85%, while the Financial Select SPDR ETF (XLF) fell 0.6%.
Timing the Market with IBD’s ETF Market Strategy
Mega Cap Stocks
Nvidia shares fell 2.4% this week to $123.54. But after dropping 6.7% on Monday, ending a three-day sell-off, the AI chip giant rebounded and stabilized above its 21-day moving average. Nvidia shares may need to rest a little longer before they can establish a new base and see their 50-day line catch up.
Meta shares rose 1.9% to 504.22. The stock broke above the cup-with-handle buy point of 514.01 on Thursday but fell nearly 3% on Friday, but is still around the initial entry within the handle.
Amazon shares rose 2.2% to 193.25, above a buy point of 191.70 for a flat base. The stock had fallen 2.3% on Friday.
Tesla shares rose 8.1% to 197.88, breaking out of a buy point at 191.08. The buy range has extended to 200.63. TSLA shares met resistance at its 40-week line on Friday but closed higher after that.
Tesla’s big weekly gains came as several analysts sharply cut their second-quarter delivery forecasts ahead of the EV giant’s news release on Tuesday.
Amazon achieved this milestone under Andy Jassy, what’s next?
Software Stocks in the Buy Zone
AppLovin shares have risen 5.9% this week to 83.22, breaking out of a tight trendline and short-term high of 82.66 on Thursday, creating an opportunity for early entry. The official flat base buy point is 88.50, according to MarketSurge.
Monday.com shares rose 7% last week to 240.76, bouncing off the 50-day line within a new flat base following new consolidation. The official buy point is 249. However, MNDY shares broke out of the trendline on Thursday. On Friday, the software maker tested a short-term high of 239.54, which is roughly in line with a previous base buy point of 239.22.
ServiceNow shares rose a little over 5% to 787.19, breaking out of the trendline. The stock has risen 23% from a low of 637.99 on May 31. The official buy point is 815.32. Ideally, NOW shares will establish an upward trend.
Meanwhile, many software stocks have rallied from their troughs and are trading within their bases, with some leaders stretched out.
Investors can use IGV and other software ETFs, which have charts very similar to ServiceNow’s, to capture the sector’s movements.
Market Rise Analysis
There are plenty of ways for active investors to take advantage of the current stock market rally.
Very active traders may have made numerous trades over the past few weeks, capturing some profits while simultaneously selling numerous stocks that rapidly declined in value during the mini-rotation. Other traders may have chosen to take little or no action in response to the movement of their existing positions.
The key is to find an investment style and rules that suit you.
Keep an eye on market and sector movements. Many software stocks should be on your watch list. Financials and industrials have retreated, but many stocks in these areas are very close to being investable.
Read The Big Picture every day to stay on top of market direction, leading stocks and key sectors.
Follow Ed Carson on Twitter at X/Twitter. translator Stock market updates and more.
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