Dow Jones futures fell slightly on Thursday morning along with S&P 500 futures and Nasdaq futures. Salesforce.com headlined earnings last night, but investors’ attention will turn to his PCE inflation report on Thursday.
X
Fed Chair Jerome Powell said Wednesday that the pace of rate hikes could start to slow at the December meeting, making his support more explicit for a smaller rate hike at the next meeting. Powell stuck to his views It indicates that the Fed Fund rate is likely to reach 5% or higher. The current Federal Funds interest rate range is 3.75% to 4%. Powell also noted that many factors supporting inflation are easing. The Fed chief, who suggested a recession might be necessary, said a “soft landing” was still possible.
Nasdaq leads the way apple (AAPL), microsoft (MSFTMore), NVIDIA (NVDA), Tesla (TSLA) and Google’s parent alphabet (Google) all outperform composites. Of note, the S&P 500 index surged to clear his 200-day moving average, a key resistance area.
On Thursday, investors will get the PCE price index for October and the November jobs report is due to be released on Friday morning.
So while Wednesday’s action was encouraging, investors should wait for the market’s reaction to the Fed’s important data.
Main income
salesforce.com (CRM), snowflake (snow) When box (box) led many software revenue reports. pure storage (PSTG) When victoria’s secret (VSCO) was also reported.
CRM shares fell solidly in pre-market trading. sales force revenue surpassed However, the guidance was light. Co-CEO Brett Taylor is stepping down, leaving Marc Benioff as sole CEO. SNOW stock also performed strongly early on Thursday after an initial bearish sell-off. Snowflake Earnings GuidanceBox stocks were little changed as EPS just outperformed and sales slightly underperformed.
PSTG shares rose slightly in the early hours of Thursday Pure Storage Tops Third Quarter Views I asked for guidance. Wednesday’s stocks fell about 1% after falling sharply during the day on weak results and guidance from the market. netapp (NTAP). VSCO’s share price fell slightly as Victoria’s Secret’s earnings increased, but sales fell slightly.
early thursday, General Dollar (DG) missed out on profits and posted lower EPS in the fourth quarter. DG stock has fallen, showing that he has broken below the 50-day line, possibly the 200-day line.
Chinese EV manufacturer Nio (Nio), lee auto (Li) When Xpeng (XPEV) reported November sales in the early hours of Thursday. Nio and Li Auto reported record monthly deliveries for their newer models. Xpeng shipments plummeted year-over-year, but picked up slightly compared to October and are expected to pick up significantly in December. All three stocks fell in pre-market trading after surging along with other Chinese names on Wednesday on hopes of Covid reopening.
inflation report
The Department of Commerce will release the PCE price index, the Fed’s favorite inflation indicator, at 8:30 am ET as part of its income and expense report.
The PCE price index for October should show a 0.4% gain over September. Year-on-year, PCE inflation should fall to 6% from 6.2% in September. Core PCE, excluding food and energy, is expected to rise 0.3%. Core PCE inflation is believed to have eased to 5% from 5.1% in September.
The PCE inflation report, along with Friday’s November jobs report, will help shape expectations for a Fed rate hike. will be announced on
Earlier Wednesday, the ADP reported a sharp slowdown in private sector employment in November. The JOLTs survey also showed that the number of job openings in October fell more than expected. Q3 GDP growth has been revised upwards more than expected, along with the report’s inflation gauge.
dow jones futures today
Dow Jones futures fell 01% against fair value and CRM stocks dragged blue chips. S&P 500 futures were down 0.1% and Nasdaq 100 futures were down 0.1%.
The 10-year Treasury yield fell 11 basis points to 3.59%.
Crude oil futures rose 1%.
remember the night action dow futures Elsewhere, it doesn’t necessarily translate into the next regular real deal stock market session.
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stock market rally
Stock market gains were mixed for much of Wednesday’s session, but rose on comments from Fed Chair Jerome Powell to close at session highs.
The Dow Jones Industrial Average rose 2.2% on Wednesday. stock market tradingThe S&P 500 Index jumped 3.1%. The Nasdaq Composite rose 4.4%. Small-cap Russell 2000 he rose 2.7%.
Apple shares were up 4.9% and Google shares were up 6.1%, both past the 50-day chart. Microsoft and NVIDIA shares have already crossed the 50-day line, jumping 6.2% and 8.2% respectively. Tesla shares rose 7.7%, regaining the 21st line.
US oil prices rose 3% to $80.55 a barrel, but fell 6.9% for the month. Hopes of a resumption of the coronavirus pandemic in China also boosted copper futures.
US Treasury Yields and Fed Hike Odds
The 10-year Treasury yield turned around, falling 5 basis points to 3.7%. Two-year Treasury yields, which are more closely tied to Fed policy, fell to 4.33%, but Powell had expected the federal funds rate to peak at least 5%.
The odds of the Fed raising rates by 50 basis points are about 79% today, compared to 66% since Tuesday. The market is looking slightly in favor of a half-point move again in February, but the odds of a quarter-point move are over 45%.
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ETFs
In between best ETFsInnovator IBD 50 ETF (FFTY) rose 1.8%, while the Innovator IBD Breakout Opportunities ETF (game) increased by 2%. iShares Expanded Tech Software Sector ETF (IGV) rose 4.4%, with Microsoft and CRM holding both major components. VanEck Vectors Semiconductor ETF (SMH) surged 5.7%, with Nvidia shares becoming the top holding.
SPDR S&P Metals & Mining ETF (XME) rose 3.75%, while the Global X US Infrastructure Development ETF (pave) increased by 2.4%. Energy Select SPDR ETF (XLE) rose 0.5%, while the Financial Select SPDR ETF (XLF) increased by 1.7%. Healthcare Select Sector SPDR Fund (XLV) added 2.4%.
Reflecting more speculative story stocks, the ARK Innovation ETF (arc) surged 7.7%, while the ARK Genomics ETF (ARKG) 6.5%. Tesla stock remains a major holding across Ark Invest ETFs.
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Market rally analysis
Wednesday’s gains in the stock market showed a major bullish move after comments from Fed Chairman Jerome Powell.
The S&P 500 Index has rebounded from around the 21-day line and crossed the 4,000 level, surpassing the 200-day line for the first time in seven months.
The Nasdaq Composite, which lagged behind the market gains, led the gains on Wednesday. The 21st line and he regained the 11,000 level, settling for a two-month high. Apple shares, Microsoft, Google, Nvidia and Tesla posted strong gains on Wednesday, but it’s not clear if any of them will lead the current uptrend.
The Russell 2000 had broken below the 21-day line during the day before rebounding to regain the 200-day line. The Dow Jones, which leads the current market rally, is back at a seven-month high.
The leading companies beat the losers with a wide range of profits. Many major stocks under pressure rebounded on Wednesday.
Despite many positive moves on Wednesday, the S&P 500 remains below its 200-day moving average. His PCE inflation report for October on Thursday and jobs report for November on Friday could reinforce Wednesday’s bullish rebound or trigger a bearish pullback.
Note that the current market rally has brought many big gains in one day, but has struggled to move forward over the days or weeks since.
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what to do now
The stock market rally was a strong session, with promising performances by major indices and major stocks.
Investors were likely tempted to increase their exposure on Wednesday, and doing so might work.
But there are still good reasons not to increase exposure. The S&P 500 has crossed his 200-day line, but not decisively. Doing so could mean breaking a long downtrend line on the weekly chart. A decisive breakout of this area could be a strong signal that the current uptrend is more than a bear market.
But that would require a positive reaction to upcoming PCE inflation data and employment reports.
Investors should diligently build watchlists and consider promising stocks in various sectors. But definitely stay engaged. The market rally may be at a tipping point, but which way will it turn?
read big picture Every day to stay in sync with market direction and major stocks and sectors.
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