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Dow Jones Futures: S&P 500 recovers key level, but be cautious; Tesla has doubled its US discount

Dow Jones Futures: S&P 500 recovers key level, but be cautious;  Tesla has doubled its US discount
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Dow Jones futures, S&P 500 futures and Nasdaq futures rose slightly after hours. Micron Technology 🇧🇷is) and Tesla 🇧🇷TSLA) was in the spotlight throughout the night.




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There was solid progress on Tuesday with the stock rally Nike 🇧🇷NKE) undulating and FedEx 🇧🇷FDX) leads in earnings, also outperforming some peers and related stocks.

The S&P 500 rose slightly above its 50-day line, a positive sign but not decisive.

apple 🇧🇷AAPL) managed to rise modestly, rising slightly above Tuesday’s bear market lows. Tesla 🇧🇷TSLA) failed to take profits, closing slightly lower. Tesla is reportedly doubling its end-of-year delivery discount in the US

Investors should be cautious. The market rally remains under pressure and has a bad habit of retreating after any show of strength.

In the meantime, First Sun 🇧🇷FSLR🇧🇷 Medspace 🇧🇷MEDP🇧🇷 Aehr Test Systems 🇧🇷AEHR🇧🇷 Imping 🇧🇷IP) and Schlumberger 🇧🇷SLB) are still leading stocks near their 50-day or 10-week moving averages.

Added MEDP shares IBD Leaderboard Wednesday, with PI shares on the Leaderboard watch list. SLB shares and KLA Corp. is on IBD Big Cap 20🇧🇷

Micron gain

Micron reported a wider-than-expected loss Q1 revenue decreased by 47%. The memory chip giant guided slightly lower for the current Q2.

Micron said it will continue to reduce capital spending. That’s not good news for chipmakers exposed to memory Applied materials 🇧🇷AMAT🇧🇷 Lam Research 🇧🇷LRCX) and QLA 🇧🇷KLAC🇧🇷

MU shares fell 2% in extended trading. Shares rose 1% to 51.19 in Wednesday’s regular session.

Meanwhile, AMAT shares and Lam Research fell 2% overnight, while KLAC shares fell less than 1%.

disk drive manufacturers Western Digital 🇧🇷WDC🇧🇷 Seagate Technology 🇧🇷STX) sank by 2.2% and 1.5% respectively.

Dow Jones Futures today

Dow Jones futures rose 0.2%. fair value. S&P 500 futures rose 0.3%, while Nasdaq 100 futures rose 0.35%.

The 10-year Treasury yield fell 3 basis points to 3.65%.

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 rally rebounded on Wednesday, quickly rising more than 1% and largely keeping those gains close.

The Dow Jones Industrial Average rose 1.6% on Wednesday stock trading🇧🇷 The S&P 500 rose 1.5% with Dow Jones giant Nike the top S&P 500 performer of the day. The Nasdaq composite also advanced 1.5%. The small-cap Russell 2000 climbed back 1.7%.

Apple shares rose 2.4% to 135.45 on Wednesday, still well below its moving averages. On Tuesday, AAPL shares hit 129.89, slightly above June’s bear market low of 129.04.

The price of US crude oil increased by 2.7% to 78.29 dollars per barrel.

The 10-year Treasury yield was unchanged at 3.68%.

ETFs

Between the best ETFsInnovator IBD 50 ETF (FFTY) rose 2.2%, the Innovator IBD Breakout Opportunities ETF (ABOUT) was 1.6% higher. iShares Expanded Tech Software Sector ETF (IGV) increased by 1.2%. VanEck Vectors Semiconductor ETF (SMH) rose by 2.2%. Micron stock is a notable SMH holding, along with chip-equipment stocks AMAT, LRCX and KLAC.

Reflecting more speculative story stocks, the ARK Innovation ETF (ARKK) rose 1.7% and the ARK Genomics ETF (ARKG) 2.2%. Tesla stock is a major holding in Ark Invest’s ETFs.

SPDR S&P Metals & Mining ETF (XME) 2.6% and Global X US Infrastructure Development ETF (HANG) 1.7%. US Global Jets ETF (JETS) increased by 1.3%. SPDR S&P Homebuilders ETF (XHB) rose 1.9%. Energy Select SPDR ETF (XLE) and the Financial Select SPDR ETF (XLF) advanced 1.55%. Healthcare Select Sector SPDR Fund (XLV) added 1.3%.


Five Best China Stocks to Watch Now


Tesla Delivery Discount

Electrek reported Tuesday that Tesla has begun offering $7,500 to get a Model 3 or Model Y to the U.S. by the end of the year. That’s up from $3,750 at the start of December with 10,000 free Supercharger miles. Tesla is trying to increase delivery numbers in the fourth quarter.

Many potential buyers may delay delivery until January. 1, when new US tax credits of up to $7,500 are triggered. Tesla’s U.S. sales may also face negative effects from Elon Musk’s Twitter actions and politically charged tweets.

Tesla shares tried to rally on Wednesday, but failed to end a losing streak on a strong Sunday. TSLA shares fell 0.2% to 137.57 on Wednesday, hitting another one-month low. Shares are down 8.4% so far this week and 29% in December.

Stocks to Watch

First Solar found support just above its 50-day line, rising 3.5% to 162.06 after falling to 150.25 on the day. FSLR shares are now 5.7% above their 10-week line and near short-term highs. The solar power leader is working on a new base, but it will take a few more weeks.

Shares of MEDP rallied 3.4% to 210.59 above the 50-day line and retook the 21-day line. Investors can buy Medpace shares now or wait for the trend line to break starting in November. 15. MEDP stock has a 235.82 buy point from a 16%-deep consolidation next to a 45%-deep cup base.

PI shares rose 2.3% to 117.15, continuing to climb above the 10-week line, but only 4% above that level. This RFID chip play could be realized as a result of this pullback after the late October earnings disruption.

AEHR bounced off its 50-day line, rising 1.3% to 22.80. A move above the 21-day line would suggest entry into volatile stocks. A chip testing firm exposed to EVs is driving incremental revenue growth.

Shares of SLB rose 3% to 53.31, continuing Tuesday’s bounce from the 50-day and 21-day lines. Schlumberger shares, which have now clearly broken the trendline in a short consolidation, are still in the running here.

Market rally analysis

OK, now there’s a bounce in the stock market rally. After taking gains on Tuesday, the major indices had a strong session on Wednesday.

The Dow Jones, supported by Nike, continued to rise above its 50-day line.

The S&P 500 index and the S&P MidCap 400 recovered only a hair from their 50-day moving averages. The S&P 500 should move decisively above the 50-day line, and that would be only the first step to a market rally.

The Nasdaq and Russell 2000 remain below their 50-day averages.

More leading stocks found support or rose from key levels, including First Solar and Aehr Test Systems. Some are flashing buy signals, but in a shaky market.


Market Timing with IBD’s ETF Market Strategy


What to do now

After last week’s ugly negative reversal week and Monday’s losses, the last few days have been positive, but don’t panic.

Market exposure should still be light. The uptrend with the S&P 500 remains under pressure at the fundamental level with several other obstacles ahead.

Even if the market rally recovers most of the previous week’s losses, there is still a risk that this could be another trap to attract investors right before the pullback.

So, while several stocks are giving buy signals, investors should be wary of taking any new positions. Yes, fresh buying in the last few days is likely to pay off if major indices continue to rise. But if the S&P 500 falls to Tuesday’s lows or worse, those new purchases will likely fizzle out.

If you are trying to play the current market, keep positions small and take at least a partial profit. Broad market ETFs can be a way to get in on the mini-rally without the risk of individual stocks.

But many stocks are built. So investors should be ready to take action, update their watchlists 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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