Dow Jones futures changed little after hours, along with S&P 500 futures and Nasdaq futures. tesla (TSLA) Elon Musk moved up late as he rallied after mixed Q4 earnings. service now (NOW) and Slide Research (LRCX) was also reported after closing. Dow Jones giant strip (CVX), announced a massive buyback as CVX stock signaled a possible buy.
x
Combined Rental (URI), Steel Dynamics (STLD) and IBM (IBM) also reported, with teradine (SWEAT) is also on the air tonight.
The stock market rally stumbled Wednesday morning. Microsoft (MSFT) and boeing (BA) were among the early losers on earnings. Major indices tested or undermined key levels, but came off well from lows and closed at or near intraday highs for the fourth consecutive session. One important reason: Boeing rose slightly, and MSFT stock trimmed losses.
URI stock open IBD Leaderboard To-watch list. Shares of United Rentals, Lam Research and STLD rise IBD Big Cap 20.
Dow Jones Futures Today
Dow Jones futures were little changed against the Dow Jones. CVX stock and IBM’s are both blue-chip fair value. S&P 500 futures rose 0.1% and Nasdaq 100 futures rose 0.3%. Tesla stock, LRCX, NOW and STLD stock are S&P 500 and Nasdaq 100 stalwarts.
Earlier on Thursday, investors will get their first reading on fourth-quarter economic growth. The GDPR report will also include: quarterly PCE price indexIt provides a strong signal for the December PCE inflation reading on Friday morning. Also on Thursday, durable goods orders, new home sales and unemployment claims are on the agenda.
Remember, overnight action Dow futures and elsewhere it doesn’t necessarily turn into real trade on the next regular trade Exchange session.
Tesla Earnings
Tesla earnings a little analysts’ views, which have fallen significantly over the past few weeks, have peaked. According to FactSet, income has just been missed. Tesla generated $324 million in Full Self-Driving revenue, which boosted the EPS beat.
Automotive gross margin fell to 25.9% from 27.9% in the third quarter and 30.6% a year ago. This was under consensus. Gross margins are expected to decline significantly in 2023, following extensive worldwide price cuts earlier this month.
CEO Elon Musk is on the rise on the conference call. He said orders are currently double production after price cuts. But the question is how strong demand will remain in the weeks and months ahead.
Tesla officially expects to produce 1.8 million vehicles, but Musk said two million deliveries are the internal target. Tesla produced 1,369,611 vehicles in 2022, delivering 1,331,851 vehicles. Production exceeded deliveries by an increasing amount in the last three quarters.
Musk said Cybertruck production will begin by the summer, but “volume production” may not happen until 2024. Tesla will reveal more details about an upcoming vehicle on its March 1 investor day. This could be a smaller, cheaper EV. This could open up a huge new market for Tesla, including new ones, but it could face numerous existing competitors.
Late Tuesday, Tesla said it will invest $3.6 billion to mass-produce semi-autos and 4680 batteries at its Nevada gigafactory. But much of the announcement reflected key aspects of Tesla’s unfulfilled plans for 2014.
TSLA stock rose 5.5% in expanded trading. Stocks rose 0.4% to 144.43 in Wednesday’s regular session and hit 50-day/10-week lines after rising from bear market lows on January 1. 6.
Tesla vs. BYD: EV Giants Are Competing For The Crown, But Which Is Better To Buy?
Chevron Stock Buyback
The Dow Jones energy giant said late Tuesday that it will repurchase $75 billion of CVX stock in Chevron. This represents 20% of outstanding shares. Chevron will increase its quarterly dividend by 6% to $1.51 per share.
The oil giant will report earnings early on Friday.
CVX stock rallied more than 2%, rebounding from the 50-day line to over 183. The shares have a buy point of 189.78 from a shallow mug bottom. However, traders can use a move above Monday’s high of 182.55 as an entry.
Other Significant Earnings
ServiceNow earnings peak while it comes in. The business software giant also provided upward subscription revenue guidance. NOW stock fell moderately overnight after trimming initial losses. Stocks rose 1.2% to 448.77 on Wednesday after breaking below the 200-day line during the day.
Lam Research earnings beat quarterly forecasts, but chip equipment provided weak guidance and announced layoffs. LRCX stock fell slightly in long-term trading. Shares were up 0.2% to 448.40 on Wednesday. Lam Research stock is working on a bottom with most of it above the 50-day and 200-day lines. This point of purchase 504.65, however, a move above Monday’s high could offer a slightly lower entry.
Teradyne earnings exceeded views, but guidance also disappointed. TER stock has dropped solidly late. Shares rose 0.4% to 103.44 on Wednesday and stayed above the 200-day mark.
LRCX and TER gains follow Wednesday’s pre-open ASML gains. KLA Corp. (ROD) will be delivered late Thursday.
Steel Dynamics earnings surpassed the number of views. STLD stock rose hours later. Shares closed at 110.41, up 2.2% on Wednesday. Steel Dynamics stock tried to clear a brief consolidation last week with a buy point of 113.22 but pulled back.
Nucor earnings will be announced on Thursday morning. NUE stock closed at 156.67, up 1.7%. Nucor share close to 160.03 mug with handle point of purchase.
United Rentals earnings were missed as revenue lined up. However, the heavy equipment rental giant gave upward guidance for 2023. URI stock rose solidly overnight. Shares fell 0.3% to 392.48 on Wednesday and are just bordering the buy zone from a buy point of 374.01 in a consolidation stretching into late 2021. URI earnings and guidance, caterpillar (CAT).
IBM earnings It peaked in views while beating revenue. IBM shares fell modestly hours later. Shares fell 0.5% to 240.61 on Wednesday. IBM stock formed a flat bottom with a buy point of 153.31 after a strong two-month run, but is currently trading below the 50-day line.
Join the IBD experts as they analyze stock rally tradable stocks on IBD Live
Stock Rally
The stock market rally started weakly, but once again recovered, closing with little change, close to the day’s best levels.
The Dow Jones Industrial Average rose slightly on Wednesday stock market trading. The S&P 500 Index closed just below the breakeven point. The Nasdaq composite fell 0.2 percent. Small-volume Russell 2000 rose 0.3%.
US crude oil prices rose 2 cents to $80.15 a barrel. Natural gas fell 5.9% to its lowest close since June 2021.
The 10-year Treasury yield fell 1 basis point to 3.46%.
ETFs
Growth ETFs include the Innovator IBD 50 ETF (fifty) rose 0.2%, while the Innovator IBD Breakout Opportunities ETF (STRUGGLE) fell 0.3%. iShares Extended Technology-Software Industry ETF (IGV) closed 0.2% lower, with Microsoft shares and NOW the main components. VanEck Vectors Semiconductor ETF (SMH) rose 0.1%. LRCX stock is an SMH holding
Reflecting stocks whose stories are more speculative, the ARK Innovation ETF (ARKK) rose 0.1%, and the ARK Genomics ETF (ARKG) rose 0.5%. Tesla stock is a key asset in Ark Invest’s ETFs. Loading Cathie Wood’s Ship.
SPDR S&P Metals & Mining ETF (XME) rose 1.25% and the Global X US Infrastructure Development ETF (FLOOR) was straight. US Global Jets (JETS) rose 1.1%. SPDR S&P Home Builders (XHB) rose 0.4%. Energy Select SPDR ETF (XLE) settled just below the breakeven point and the Financial Select SPDR ETF (XLF) rose 0.8%. Health Sector Selected SPDR Fund (XLV) won a fraction.
Top Five China Stocks to Watch Now
Stock Rally Analysis
The stock market rally was sold out on Wednesday morning, but rebounded well from the lows. Major indexes closed close to highs for the fourth consecutive session.
The S&P 500 fell 1.7% over the day, breaking below the 200-day line and approaching the 50-day line during the day. However, the benchmark index basically closed flat.
The Nasdaq composite and Russell 2000 bounced comfortably from lows above their 50-day lines. The Dow Jones fell below the 50-day line on the day, but closed above it once again.
Dow giants Microsoft and Boeing skidded on the opening, but bounced back to finish with little change. Many names associated with the cloud that stumbled upon under Microsoft’s guidance cut losses.
Leading stocks showed generally healthy moves, including chip rig, travel, medical and housing stocks. While one of the biggest complaints about leading stocks is that a slightly longer break or pullback from last week would be worthwhile, that’s saying something.
A number of recent breakouts have pulled back below buy points, but it could still work, for example SLB (SLB), imp (PI) and Medpace (MEDP). Meanwhile, some other stocks like Boeing and Boeing that have expanded from their bases may be pushing the levers in long consolidations. Shift4Payments (FOUR).
The overall market rally action was encouraging. Key indices still need to resolutely surpass their late 2022 highs, but they are moving towards them.
The earnings era continues to be active as Tesla and ServiceNow gain weight in overnight trading.
Thursday, Friday and next week a few key economic reports and 1 February. 1 Fed meeting announcement will move markets as well as gains.
Time the Market with IBD’s ETF Market Strategy
what to do now
The fact that major indices and many leading stocks found support on Wednesday does not mean they will continue until Saturday. A few weeks from now, it may seem obvious that investors need more exposure or exits. But it is not clear now.
So be careful about adding exposure and stick to rules that reduce harm.
Definitely work on your watch lists. Build a broad network: Various sectors are showing strength, which is a bullish sign for a market rally.
To read big picture Staying in sync with market direction and leading stocks and industries every day.
Please follow Ed Carson on Twitter: @IBD_ECarson for stock market updates and more.
YOU MAY ALSO LIKE:
Why Does This IBD Tool Simplify? turn yellowCh For Best Stocks
Catch the Next Big Winning Stock with MarketSmith
Want to Earn Quick Profits and Avoid Big Losses? Try SwingTrader
Best Growth Stocks to Buy and Watch
IBD Digital: Open IBD’s Premium Stock Listings, Tools and Analysis Today
