Dow Jones futures will open Monday evening, along with S&P 500 futures and Nasdaq futures, after a long Christmas weekend.
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Tesla Shanghai halted production ahead of Christmas as it competes with China Nio 🇧🇷NO) presented new models.
The stock market rally ended another tough week, but rebounded from lows on Thursday. Major indexes were mixed, but many leading stocks remained under more pressure. The upward trend seems weak, but not yet complete.
Not a good time to buy stocks, especially growth names. But investors should always look for potential growth leaders for the next sustained market rally. Shift4 Payments 🇧🇷FOUR🇧🇷 Celsius 🇧🇷CELH🇧🇷 Imping 🇧🇷IP🇧🇷 Focus on energy 🇧🇷ENPH) and Box 🇧🇷BOX) are holding up relatively well in the current weak market. FOUR shares and Box are consolidating near recent highs, while Impinge, Celsius and ENPH are trading around their 50-day or 10-week lines. None are effective at the moment, and all could be shut down if the market continues to weaken. But watch out for them.
ENPH reserve is active IBD Leaderboard, with PI backup on the leaderboard watchlist. Emphasis is on Shift4Payments, Box and CELH shares IBD 50🇧🇷 ENPH shares are also on IBD Big Cap 20🇧🇷 Shift4Payments was Friday IBD Stock of the Day🇧🇷
But growth in megacaps, in particular, was a rough ride apple 🇧🇷AAPL🇧🇷 nvidia 🇧🇷NVDA) and Tesla 🇧🇷TSLA🇧🇷
Nio Day 2022
Finally, Tesla Chinese Rival Nio 🇧🇷NO) is celebrating Nio Day 2022 on Saturday. It introduced the EC7 coupe SUV, a high-end rival to the Tesla Model Y. EC7 will start shipping in May 2023. Nio has also introduced the updated ES8 SUV, which is based on the NT 2.0 platform as its all-new model. Deliveries begin in June.
Nio also announced a new generation of battery swapping stations and charging options.
Nio production is growing with strong demand for the newer ET5 sedan and ES7 crossover SUV. But the easing of Covid regulations could trigger a major wave of infections, and Nio and other Chinese EV makers could again face production or supply chain hiccups. The EV giant BYD 🇧🇷BYDDF) said this week that Covid cases among workers have reduced production by 2,000-3,000 cars per day.
Nio shares fell 5.4% last week, falling below the 50-day line. Shares are well below the 200-day line.
Tesla Shanghai production suspended
Tesla Shanghai stopped production in December. On January 24, the workers are preparing to return. 1, 2023. In recent weeks, a production shutdown at the end of the year has been widely reported. Shanghai had already slowed output earlier in the month as inventories rose sharply, despite price cuts at the end of October and significant stimulus later in the year. Some employees of Tesla and suppliers also faced Covid.
Tesla, which previously denied that production would be halted, said the shutdown was for annual scheduled maintenance.
Last week, Tesla shares fell 18% to 123.15, after falling 16.1% the previous week. These are the worst weekly losses since the Covid crash in March 2020. TSLA shares have fallen 70% from their November 2021 peak to a 27-month low.
On Tuesday, weekly Chinese EV registrations will show whether recent incentives offer a late Tesla boost. They also asked whether BYD’s production problems had hit supplies, as well as the Nio, Read automatically 🇧🇷LI) and XPeng 🇧🇷XPEV) closes in October 2022.
Dow Jones Futures today
With Christmas on Sunday, US stock and bond markets are closed on Monday, along with many exchanges around the world.
Dow Jones futures open at 6:00 PM ET along with S&P 500 and Nasdaq 100 futures.
China has announced further easing of its Covid policy, downgrading the coronavirus emergency to a lower level. It also lifts Covid quarantine rules for travelers arriving in January. 8.
Don’t forget that it’s a one night stand dow futures and elsewhere does not necessarily become the actual trade on a regular basis Stock market session.
Join IBD’s experts as they analyze the stocks that made the most of the stock rally on IBD Live
Stock market rally
The stock market rallied sharply for the week, but ended the week at its worst levels.
The Dow Jones Industrial Average rose 0.9% last week stock trading🇧🇷 The S&P 500 index fell by 0.2%. The Nasdaq lost 1.9%. The small-cap Russell 2000 finished just above par.
Apple shares fell 2% in the past week to 131.86. It is testing June’s bear market low of 129.04, falling to 129.64 on Friday morning.
Shares of Nvidia fell 8.2% to 152.06 after a nasty retreat below the 200-day line the previous week amid broad chip selling. Shares of NVDA found support at the 50-day line on Friday.
The 10-year Treasury yield rose 27 basis points to 3.75%. The inverse relationship between Treasury yields and stock prices has weakened over the past few weeks.
U.S. crude oil futures rose 6.9% on the week to $79.56 a barrel and briefly crossed $80 on Friday.
Tesla is closing in on a very exciting 2023
ETFs
Between the best ETFsInnovator IBD 50 ETF (FFTY) fell 0.3% last week, while the Innovator IBD Breakout Opportunities ETF (ABOUT) increased by 0.7%. iShares Expanded Tech Software Sector ETF (IGV) decreased by 1.8%. VanEck Vectors Semiconductor ETF (SMH) lost 4.7%, NVDA stock is a major SMH holding.
SPDR S&P Metals & Mining ETF (XME) rose 1.6% last week. Global X US Infrastructure Development ETF (HANG) increased by 0.75%. US Global Jets ETF (JETS) decreased by 1.3%. SPDR S&P Homebuilders ETF (XHB) decreased by 1.25%. Energy Select SPDR ETF (XLE) fell 3.2% and the Financial Select SPDR ETF (XLF) increased by 0.8%. Healthcare Select Sector SPDR Fund (XLV) rose 0.4%.
Reflecting more speculative story stocks, the ARK Innovation ETF (ARKK) fell 6.9% on Thursday, hitting a new five-year low. ARK Genomics ETF (ARKG) slipped 5.6% last week. Tesla shares remain the top holding among Ark Invest’s ETFs.
Five Best China Stocks to Watch Now
Growth stocks to watch
Shares of Shift4Payments rose 4.1% last week to 54.06. FOUR shares have seen wild swings but have consolidated near seven-month highs over the past few weeks. The line of relative strength is the highest level in eight months, reflecting the superior performance of Shift4. S&P 500 index. Still, FOUR stock doesn’t have a clear buy point right now.
Shift4 earnings and sales growth accelerated last quarter, and the company significantly expanded its target markets.
Shares of CELH fell 1.85% last week to 106.79, consolidating just below the 21-day line and nearing the 10-week line. The Celsius stock briefly rose to 118.29 cup base point of purchase earlier this month before withdrawing. However, this allows the 10-week line to mature, while the RS line is near the highs. A strong rebound above the 10-week line and the 21-day line would also break the short bearish trend, suggesting early entry for CELH stock.
Celsi has rapid sales growth and should see strong earnings in 2023, but the energy drink maker has a caffeinated valuation.
Impinge shares rose 4 cents to 111.87, a 2.9% drop on Friday that sent it below the 50-day and 10-week lines for the first time since a strong earnings gap in October. 27. PI stock has narrowly retreated from a four-week record high, but its RS line is almost down. A bullish bounce from the 50-day line would suggest an early one point of purchase🇧🇷
Impinge revenues rose in 2022 and saw strong gains next year.
Accent shares fell 3.1% last week to 293.95 below the 50-day line. 316.97 purchase points from a cup with handle point of purchase is no longer valid. The ever-volatile ENPH stock may take a few weeks to a new consolidation. A bullish move above the 50-day line—perhaps a retracement of an old buy point—could suggest an aggressive entry.
Earnings and revenue growth are accelerating, with strong growth in 2023 and beyond, and solar incentives for years to come.
Box shares have traded solidly over the past few weeks, down 0.7% to 31.01. The cloud-based data storage firm is on the edge of the buying zone from the 29.57 cup-handled purchase point. MarketSmith analysis, 12 breakouts after December. The recent break could be seen as support for an eight-month consolidation. This buy point is 31.10, but investors may look for an early entry. Ideally, the 21-day line will hold and the 50-day line will close the gap with Box stock.
Box earnings growth has accelerated in the past two quarters.
Market rally analysis
The stock market rally remains under heavy pressure. The major indexes were mixed for the week, not bouncing back from the previous week’s big, ugly foreign week.
The Dow Jones rose modestly for the week after repeatedly testing its 50-day line.
The S&P 500 fell modestly, but that masked some big swings for the week. The benchmark index recovered its 50-day moving average on Wednesday. On Thursday, the S&P 500 and other major indexes fell to their worst levels in weeks but closed lower.
On Friday, the S&P 500 rose slightly, but below its 50-day line. Invesco S&P 500 Equal Weight ETF (RSP), with less weight to tech titans like Apple, rallied on Friday to retrace its 50-day period.
The Nasdaq was the big laggard, with Tesla shares and Nvidia among the notable laggards. But there was broad weakness for growth stocks, especially among chip names, after weak results and memory chipmaker guidance. Micron Technology 🇧🇷is🇧🇷
The S&P 500 should recover the 50-day line, but that would be only the first step.
It’s unclear whether the market will rebound, fall back to bearish lows, or move sideways in an extended period of volatility. The latter may be more likely until there is some clarity on when and where the Fed will stop raising interest rates, and whether the economy will slide into a clear recession.
While growth stocks like Enphase and Celsius are worth watching, many medical stocks and other defensive growth plays continue. Metals and mining, industrials, housing and some energy plays are doing relatively well.
Market Timing with IBD’s ETF Market Strategy
What to do now
The stock market rose steadily during the week with a sharp change in the technical landscape. Other than the Dow Jones, the major indexes are below the major moving averages. Leading stocks have been difficult to maintain at best.
Investors should have minimal exposure and be cautious about adding new positions. Don’t get excited by a strong open or even a bullish session or two.
Keep your watch lists fresh. Many stocks from various sectors are building or set to build. Some names show strong relative strength but lack a clear buy point. That’s fine now.
In the meantime, take a moment to review your trades over the past year, including the big winners and losers and the trades you didn’t make but wish you had. Were you following your rules and were your rules sound?
Read it The Big Picture daily to stay in sync with market direction and leading stocks and sectors.
Follow Ed Carson on Twitter @IBD_ECarson for stock updates and more.
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