Dow futures fell slightly overnight, along with S&P 500 futures and Nasdaq futures. Big earnings from JPMorgan, Bank of America, United Health, Delta Airlines, and more will trade in on Friday morning.
The stock market rally gained more ground on Thursday, although the S&P 500 hit resistance in a critical area.
the The long-awaited CPI inflation report Pricing showed reduced pressures largely in line with expectations, although gains in service pricing were a mixed picture. However, the sluggish inflation trend should continue for several months, raising hopes that the Federal Reserve will soon end its rate hikes.
Investors should look to add exposure carefully. This market is prone to pullbacks, and it could be because of one thing. Meanwhile, many blue-chip stocks have been extended since at least early Buy points. Exxon Mobil (xom) And Centennial Holdings (CELH) is still executable.
JPMorgan stock is in buy territory after traditional breakout. Bank of America and Citigroup stocks are close to early entry on the lower bases. WFC stock has more work to do. UN shares sold off in 2023 along with other health insurers, though they were higher on Thursday. DAL stock surged in 2023 with the airline group, adding to gains on bullish preliminary revenue from American Airlines (AAL). But delta is well stretched from the early entries and runs on the right side of a long, deep base.
JPM and UnitedHealth stocks are both components of Dow Jones.
Dow jones futures today
Dow Jones futures fell 0.1% against fair value, with S&P 500 futures down 0.2%. Nasdaq 100 futures fell 0.4%.
The 10-year Treasury yield rose 2 basis points, to 3.47%.
Stock market rise
The stock market rally volatile Thursday, with volatile initial market swings continuing into the morning. But as the session went on, the major indices calmed down and moved higher before fading somewhat during the day.
The Dow Jones Industrial Average advanced 0.6% on Thursday Stock market trading. The S&P 500 rose 0.3%. The Nasdaq Composite Index rose 0.6%. Small cap Russell 2000 jumped 1.7%.
US crude oil prices rose 1.3% to $78.39 a barrel, up 7.6% over the past six sessions.
Copper rose 0.8% on Thursday, up 11.9% over the past six trading days.
The 10-year Treasury yield fell 11 basis points to 3.45%, near its recent lows. The two-year Treasury yield, which is closely linked to Fed policy, hit a three-month low. Markets priced in a rate hike of about a quarter point on February 1, which would be a pullback from 50bps and 75bps at the previous two meetings. Investors also expect another quarter-point rise in March to the 4.75%-5% range. For now, the markets are betting that this is the end.
Exchange Traded Funds
Among the ETFs, the Innovator IBD 50 ETF (fiftyand creator of the IBD Breakout Opportunities ETF (fit) rose 0.7%. iShares Expanded Technology and Software ETF (IGV) increased by 0.8%. VanEck Vectors Semiconductor Corporation (SMH) increased by 1.5%.
SPDR S&P Metals & Mining ETFs (XME(jumped 2% and the Global Infrastructure Development Fund (ETF) in the USA)cradle) by 0.8%. US Global Gates Foundation ETF (Planes) rose 4.6%, with shares of DAL and American Air both major holdings. SPDR S&P Homebuilders ETF (XHB) increased by 0.3%. Energy Defined Fund SPDR ETF (xle) an advance of 1.9%. SPDR Financial Selection Fund (45) rose 0.2%, with all major constituents of JPMorgan, Wells Fargo, Citigroup and BAC. SPDR Health Care Sector Selection Fund (XLV) fell 0.3%, with a major share of United Nations shares.
Market rally analysis
After fluctuating in the morning, the major indices finally rose modestly, while the small caps jumped.
The S&P 500 hit its 200-day moving average, and closed below that key level. The NASDAQ held support at the 50-day line and moved slightly above that area.
The Dow Jones and Russell 2000 indexes, both above their moving averages, are working toward their December highs.
In general, the market rally has made great strides over the past five sessions. Investors see light at the end of the tunnel to raise interest rates.
However, the leading indicators face more tests. The S&P 500 needs to decisively clear the 200-day line, hitting resistance several times. The December peaks are the ultimate test for indices. But after running for several sessions, with the main indicators around key levels, it wouldn’t be a sudden stop or pullback.
The leading stocks show better movement, but many of them are now extending, at least from early entries or moving averages.
Exxon Mobil stock rose 1.7% to 113.22, just below 114.76. Flat base Point purchase, according to MarketSmith Analysis. But XOM stock is in a range of the 50-day line. Celsius fell 0.2% to 106.40, but found support at the 21-day line. CELH stock is still executable from Wednesday’s jump, bouncing from the 50-day line and breaking a short trend line.
In a positive sign of the broader market rally, the chip sector has regained momentum, with the SMF ETF moving decisively above the 200-day line this week. Taiwan Semiconductor (TSM), SMH’s largest company, crossed the 200-day streak on earnings. This is despite lower revenues and TSMC also steering lower in the first quarter. But not many chip names, even those that are clearly market leaders, are actionable right now.
What are you doing now
The stock market rally saw a strong extension, moving above some key resistance areas and as the CPI inflation report faded.
Investors can add exposure, gradually, if conditions continue to improve. Major indices, sectors and blue-chip stocks tend to make significant declines and also appear to be gaining strength. And the market rally is gaining momentum.
Earnings season can turn the market around, criticizing certain sectors or stocks.
Investors who have been largely on the sidelines in recent days may feel like they missed out on great opportunities. It’s true that some stocks may be out of reach at the moment. But don’t chase extended names. Wait to see if they pause, back off, or create new rules. Meanwhile, other arrows will come to the fore.
If this market rally had real legs, there would be plenty of opportunity. If you stop by quickly again, you’ll be glad you didn’t invest too heavily.
But it is necessary to update your watchlists. Grid wide to find stocks that are building across different sectors. Then focus on “ready-made” stocks or thereabouts.
Read The Big Picture Every day to keep up with the market trend, stocks and leading sectors.
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