Dow Jones futures rose modestly early Friday, along with S&P 500 futures and Nasdaq futures.
The stock market rally extended a year-end losing streak into 2025 with modest losses Thursday after big intraday swings. The Nasdaq undercut its 50-day moving average but closed above that key level.
Tesla and Apple skidded on negative news. But fellow megacap Nvidia rose, still stuck below a key level.
Many stocks flashed buy signals Thursday, including Meta Platforms, Cloudflare, Vistra, Talen Energy and Nvidia chipmaker Taiwan Semiconductor.
But this is not a particularly good time to be making buys.
Nvidia stock and Meta Platforms are on IBD Leaderboard, with Tesla on the Leaderboard watchlist. Cloudflare and Taiwan Semiconductor stock are on the IBD 50. Cloudflare stock is on the IBD Big Cap 20.
Dow Jones Futures Today
Dow Jones futures rose 0.35% vs. fair value. S&P 500 futures advanced 0.35% and Nasdaq 100 futures climbed 0.5%.
The 10-year Treasury yield edged down to 4.54%.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
Join IBD experts as they analyze leading stocks and the market on IBD Live
Stock Market Rally
The stock market rally tried to start the new year on a positive note, but after some volatile early gains the indexes turned solidly lower in the afternoon before paring losses near the close.
The Dow Jones Industrial Average fell 0.4% in Thursday's stock market trading. The S&P 500 index and Nasdaq composite declined 0.2%. The small-cap Russell 2000 edged up 0.1% but ended well off early highs.
The Nasdaq undercut its 50-day line for much of the session but closed above it. The other key indexes are already below their 50-day averages. The S&P 500 reversed after nearly regaining its 50-day soon after the open.
Apple stock slumped 2.6% to 243.85, below its 21-day line, weighing on the major indexes. Shares are moving toward their 50-day line and a 237.49 buy point. Apple will offer short-term iPhone discounts in China amid stiff competition. Meanwhile, UBS cut Apple estimates on weak iPhone sales overall.
Tesla stock's sell-off also weighed on the S&P 500 and Nasdaq.
Meta stock jumped to 604.91 intraday, rebounding from its 50-day line to reclaim a 602.95 buy point as well as breaking a trendline. Shares closed up 2.3% to 599.24.
A number of leading stocks made bullish moves Tuesday, including Cloudflare, Vistra, Talen, Taiwan Semi, Interactive Brokers, Spotify and Kinetik Holdings. Holding and extending those gains will be tough if the market keeps struggling.
U.S. crude oil prices rose 2% to $73.13 a barrel, the best close since Oct. 14.
The 10-year Treasury yield was essentially flat at 4.57% after falling to 4.53% initially and rising to 4.6% in the early afternoon.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF rose 1.3%. The iShares Expanded Tech-Software Sector ETF dipped 02%. The VanEck Vectors Semiconductor ETF climbed 1.1%. Nvidia and TSM stock are massive holdings.
ARK Innovation ETF edged up 0.2% and ARK Genomics ETF jumped 3.9%. Tesla stock is a major holding across ARK Invest's ETFs. Cathie Wood's Ark also has a big Nvidia stake.
SPDR S&P Metals & Mining ETF bounced 1.55%. SPDR S&P Homebuilders ETF declined 1%. The Energy Select SPDR ETF advanced 1.2% and the Health Care Select Sector SPDR Fund was just above break-even.
The Industrial Select Sector SPDR Fund lost 0.35% while the Financial Select SPDR ETF retreated 0.25%.
Time The Market With IBD's ETF Market Strategy
Nvidia, Taiwan Semiconductor
Nvidia stock rose 3% to 138.31 on Thursday, back above the 21-day line, but still slightly below the 50-day line. Nvidia has a shallow double-bottom base with a 146.54 buy point, right next to the top of a prior base. The Dec. 24 high of 141.90 could serve as an early entry.
NVDA stock edged higher early Friday, almost to the 50-day.
Taiwan Semiconductor stock climbed 2.1% to 201.57, bouncing from around the 50-day/10-week line. That offered an aggressive entry, though shares came off intraday highs of 203.77. TSM stock cleared a 205.63 cup-with-handle buy point on Dec. 23, but then fell the next five sessions.
Taiwan Semiconductor will report December sales on Jan. 10, with fourth-quarter earnings on Jan. 16.
Tesla Stock Dives On Deliveries
Tesla stock tumbled 6.1% to 379.28 on Thursday. Shares have lost almost 18% in a five-session losing streak. TSLA stock peaked at 488.54 on Dec. 18. The EV giant is now heading down toward its 10-week and 50-day moving averages. A bounce off those levels could offer a buying opportunity, but TSLA stock's near-vertical drop would raise the risks.
Early Thursday, Tesla reported fourth-quarter deliveries of 495,570, a new quarterly record, but below estimates of roughly 506,000. In the Q3 earnings report, Tesla predicted full-year deliveries would top 2023's total of 1.81 million, but they finished down 1.1% to 1.79 million.
Tesla also lost its BEV crown to rival BYD, which raced up to 595,413 BEVs (battery electric vehicles) in Q4. BYD's BEV and PHEV (plug-in hybrid electric vehicle) sales surged 41% in 2024 to 4.27 million.
On the plus side, the dual-motor Tesla Cybertruck is now eligible for the $7,500 tax credit. Also Tesla China stores are reportedly taking preorders for the soon-to-launch refreshed Model Y.
What To Do Now
The Nasdaq just held its 50-day line, but is riding a five-day losing streak. And it's the best-looking index by far. If the Nasdaq decisively moves below the 50-day it could be a breaking point for an ailing market rally.
To be fair, many leading stocks are still showing strength or resilience, but by no means all.
Nimble traders could have tried a trade or two Thursday, but it's a higher-risk, lower-reward environment. While a few names may continue to make progress, the vast majority of stocks will slide when the market is struggling.
For investors that are still heavily invested, they may want to reduce exposure, especially if the Nasdaq breaks the 50-day line decisively.
Still, it wouldn't take much for the market rally to look interesting again, so stay engaged. Keep working on watchlists, focusing on those holding key levels and with strong relative strength. But don't ramp up exposure at the first positive blip.
Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.
