Dow Jones futures, along with S&P 500 futures and Nasdaq futures, edged higher early Wednesday on key economic data. Treasury yields and crude oil fell.
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The stock market began 2023 as it ended last year, with gains on Tuesday followed by reversals in major indexes and leading stocks.
Apple shares fell to fresh bear market lows on Tuesday, reportedly falling below $2 trillion. apple (AAPL) is there cut orders for suppliers For MacBook, AirPods and Apple Watch products.
Tesla (TSLA) fell to market lows after record fourth-quarter deliveries that still missed bearish views on even bigger demand concerns in 2023.
Investors should wait for clear signs of a sustained stock market rally before making new purchases.
LLY shares, Dow Jones giant caterpillar (CAT) and the recent IPO furniture (MBLY) are three stocks worth watching. MBLY is on the stock IBD 50. Eli Lilly was on Tuesday IBD Stock of the Day.
A video embedded in the article discussed Tuesday’s market action and analyzed CAT stocks, Eli Lilly and Mobileye.
Dow Jones Futures today
Dow Jones futures rose 0.2%. fair value. S&P 500 futures advanced 0.2% and Nasdaq 100 futures advanced 0.4%.
Apple and Tesla rose slightly in premarket trading.
Downgraded by UBS Microsoft (MSFT) is open Azure and Office concerns Dow beat the software giant. UBS also gave a Dow component honeywell (teacher) double low price to sell. Another Dow component, salesforce.com (CRM), rose modestly in a restructuring plan that will cut 10% of its workforce.
The 10-year Treasury yield fell 10 basis points to 3.69%.
Crude oil futures fell more than 3%. Natural gas tried to hold steady after a big selloff.
At 10 a.m. ET on Wednesday, investors will get December’s ISM manufacturing index as well as jobs from the November JOLTS survey. Minutes of the December policy meeting are due at 2:00 PM ET. These are the news from Friday’s December jobs report.
Hong Kong’s Hang Seng rose 3.2%, continuing to bounce back on hopes of gains from Covid infections. China’s internet boomed in part on signs of this regulators relax alibaba (Baby sitter) and its affiliate Ant Group.
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 on Tuesday
The stock market opened higher on Tuesday, but quickly headed south before paring significant losses in afternoon trading.
The Dow Jones Industrial Average closed only a fraction lower on Tuesday stock trading. The S&P 500 lost 0.4%, with Tesla shares the worst performer ever. The Nasdaq lost 0.8%. The small-cap Russell 2000 yielded 0.6%.
The price of crude oil in the United States fell 4.2% to $76.93 per barrel after three consecutive weekly increases. Natural gas prices fell 10.9%, extending a big selloff in recent weeks.
The 10-year Treasury yield fell 9 basis points to 3.79%, but was at an intraday low of 3.72%.
ETFs
Between the best ETFsInnovator IBD 50 ETF (FFTY) fell 1.1%, while the Innovator IBD Breakout Opportunities ETF (ABOUT) gave 0.8%. iShares Expanded Tech Software Sector ETF (IGV) increased by 0.2%. VanEck Vectors Semiconductor ETF (SMH) retreated 0.8%.
SPDR S&P Metals & Mining ETF (XME) 1.4% and Global X US Infrastructure Development ETF (HANG) was correct. US Global Jets ETF (JETS) decreased by 0.6%. SPDR S&P Homebuilders ETF (XHB) rose 1.3%. Energy Select SPDR ETF (XLE) fell 3.5% and the Financial Select SPDR ETF (XLF) increased by 0.35%. Healthcare Select Sector SPDR Fund (XLV) decreased by 0.3%.
Reflecting more speculative story stocks, the ARK Innovation ETF (ARKK) lost 2.5%, not far from last week’s five-year low. ARK Genomics ETF (ARKG) decreased by 2.1%. Tesla stock is a key holding among Ark Invest’s ETFs. Cathie Wood’s ARK bought a lot of TSLA stock in the past three months as the EV giant sank.
Five Best China Stocks to Watch Now
apple stock
Apple shares fell 3.7% to 125.07 on Tuesday, ending last week’s bear market and hitting their worst level since June 2021.
Shares of AAPL, which topped $3 trillion intraday in early 2022, fell below $2 trillion for the first time since March 2021. Apple shares closed on Tuesday with a market value of $1.988 trillion. It is still the most valuable company in the world.
Bloomberg reports that the giant Foxconn iPhone factory in China has restored up to 90% capacity. But Apple is reducing orders for AirPods, MacBooks and Apple Watch products.
AAPL shares rose early Wednesday, despite Wedbush cutting its price target to 175 from 200.
Tesla shares
Tesla shares fell 12.2% to 108.10, off last week’s bear market lows and hitting their worst level since August 2020. It was the EV giant’s worst one-day loss in more than two years. TSLA stock is already down 37% in December and 65% for 2022.
Tesla deliveries hit a record high in Q4, but for the second quarter in a row they were well short of lower estimates and actual production. This was despite big end-of-year promotions to boost sales, particularly in China and the US.
With new Tesla EV orders well below the current delivery rate, the outlook for 2023 could be bleak.
Bernstein’s Toni Sacconaghi wrote on Sunday that “Tesla’s 4Q annual order rate was just ~1 million units including significant discounts, and the company aims to sell close to 2 million units in 2023 without any new models.”
With a shrinking backlog, Tesla may need price cuts or incentives well above year-end offerings to maintain its Q4 2023 delivery pace.
Tesla Vs. BYD: EV giants vying for the crown, but which one is better to buy?
Stock market analysis
The stock market started strong in 2023 – 12 minutes. After that, the major indices pulled back sharply, though they hit intraday lows.
The Dow Jones edged lower after briefly crossing above its 50-day and 21-day lines. The S&P 500 and Russell 2000 fell below 21-day lines.
The Nasdaq bounced back after nearing its 21-day line.
Shares of Tesla and Apple were big drags on the major indexes. But there was a broad-based pushback. Energy stocks were the big losers in key prices.
Many interesting stocks opened higher but then fell with the major indices, such as Mobileye, Celsius (CELH) and Medspace (MEDP).
Eli Lilly and Caterpillar, along with related defensive growth names, held up relatively well. LLY stock is testing its 50-day/10-week lines.
China-based stocks, especially internet stocks Pinduoduo (PDD) and plays like a Macau casino las vegas sands (LVS), bucked the trend, but they also went higher.
The major indices eventually pared their losses, but returns from key technical levels were not encouraging. Many stocks fell hard and did not come back. The stock market is trying to rally thanks to last Thursday’s gains, but it looks like a one-day bounce.
The market is in a correction, not far from the Nasdaq bear market low. Even if the rallying effort gains momentum and takes stages follow-up day there will still be a number of technical hurdles to overcome in the next week or two.
Market Timing with IBD’s ETF Market Strategy
What to do now
It is not a good time to take new positions. This is a market correction with major indices, sectors and individual sectors prone to reversals.
Don’t be fooled by sudden market bursts that push stocks into buy zones. A number of stocks gave buy signals within minutes on Tuesday, but most quickly faded. While major indexes ended with modest losses, an investor who jumped into MBLY shares near Tuesday’s open could now be sitting on a 10% loss.
Conclusion: Don’t act like the market is in an uptrend until the market is actually in an uptrend.
Still, many good stocks continue to trade near buy points, while an attempted market rally could lead to a follow-up in the coming days. So create your watch lists and get busy.
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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