Dow Jones futures edged lower early Wednesday, while S&P 500 futures and especially Nasdaq futures fell as Nvidia tumbled on new AI chip export curbs. Retail sales are on tap with consumers rushing to buy before Trump tariffs hit.
The stock market saw slim losses Tuesday after the major indexes again hit resistance, though Trump tariff volatility waned. Palantir Technologies, CrowdStrike, MercadoLibre and Netflix are all flashing buy signals from double-bottom bases. Netflix earnings loom.
Palantir is on IBD Leaderboard, with Spotify and Netflix stock on the Leaderboard watchlist. Palantir stock also is on the IBD 50. Progressive stock, Netflix and Palantir are on the IBD Big Cap 20. MercadoLibre was Tuesday's IBD Stock Of The Day. Spotify stock was Monday's pick.
The video embedded in the article discusses Tuesday market action and analyzes Netflix, CrowdStrike and Progressive stock.
Dow Jones Futures Today
Dow Jones futures dipped 0.1% vs. fair value. S&P 500 futures declined 0.8% and Nasdaq 100 futures fell 1.45%. Nvidia stock is a Dow Jones, S&P 500 and Nasdaq 100 giant.
Crude oil rose slightly.
China GDP grew 5.4% in the first quarter vs. a year earlier, beating views for 5.2%. March retail sales rose 5.9%, above consensus for 4.2%. Industrial production jumped 7.7%, beating estimates for 5.8%.
The March retail sales report is due out at 8:30 a.m. ET, with a big jump seen as consumers rush to make purchases, especially autos, before Trump tariffs trigger price hikes.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
Nvidia H20 Chip Banned
Nvidia late Tuesday said it would take a $5.5 billion charge related to H20 GPUs. On April 9, the Trump administration told the company that that it will need an export license for the H20 AI chip to China. The H20 chip was specifically designed for the China market to comply with U.S. export curbs.
The revenue hit for the full year could be a lot higher.
Nvidia stock fell sharply overnight, with some related AI chip plays also declining.
More broadly, this means the technology and economic decoupling between the U.S. and China continues.
Trump Tariffs
President Trump says he'll take part in trade talks with Japan today. China is willing to hold negotiations, Bloomberg reported, but says Trump officials must show "respect" and wants talks to include discussions of Taiwan and more.
California will sue over the Trump tariffs, the latest legal action challenging the president's authority to make sweeping changes to duties claiming emergency powers.
Tesla is halting shipments of Chinese parts for the Cybercab and Semi due to 145% Trump tariffs, Reuters reported, citing a source. TSLA stock fell modestly overnight.
Key Earnings
United Airlines beat views Tuesday night while Interactive Brokers had mixed results Tuesday night. United stock jumped late. Interactive Brokers sold off.
Early Wednesday, chip-gear giant ASML beat fiscal first-quarter earnings estimates but sales guidance was light while the CEO warned of long-term tariff uncertainty. ASML fell solidly before the open.
Dow insurance giant Travelers easily beat Q1 EPS views but net written premiums missed. Shares rose modestly.
Insurer Progressive also is on tap.
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Stock Market Tuesday
The stock market rallied Tuesday morning, but the major indexes once again backed off from their falling 21-day exponential moving averages.
Trump tariff news was relatively mild, though China reportedly halted Boeing jet shipments while the European Union is pessimistic about U.S. trade talks.
The Dow Jones Industrial Average fell 0.4% in Tuesday's stock market trading. The S&P 500 index dipped 0.2%. The Nasdaq composite lost a fraction. The small-cap Russell 2000 climbed 0.1%
Getting above the 21-day line is important, but the major indexes would then face several other notable key levels, including the 200-day and 50-day lines.
A stock market rally attempt continues, but there has been no follow-through day yet.
U.S. crude oil prices dipped 0.3% to $61.33 a barrel.
The 10-year Treasury yield fell four basis points to 4.32%, continuing a retreat after last week's unsettling rise.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF climbed 1.1%. The iShares Expanded Tech-Software Sector ETF gained 1.3%, with Palantir and CrowdStrike stock both notable members. The VanEck Vectors Semiconductor ETF advanced 0.65%. Nvidia stock is the dominant SMH hlding.
ARK Innovation ETF rose 0.5% and ARK Genomics ETF dipped 0.1%.
SPDR S&P Metals & Mining ETF sank 0.3%. The Energy Select SPDR ETF stepped down 0.15% and the Health Care Select Sector SPDR Fund retreated 0.6%.
The Industrial Select Sector SPDR Fund declined 0.5%.
The Financial Select SPDR ETF rose 0.25%, with Progressive and Travelers stock both members.
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Stocks In Buy Areas
Palantir, Netflix, CrowdStrike and MercadoLibre are all clearing buy points or early entries from double-bottom bases, a common pattern in volatile markets. All boast strong relative strength lines, with several hitting new highs in the past few days.
Palantir stock rallied 6.2% to 98.37, moving off the 50-day line after Monday's strong gain. That offered an early entry, with PLTR stock close to the traditional buy point of 98.17. Shares are up x% so far this week, buoyed by Palantir's AI deal with NATO.
Netflix stock jumped 4.8% to 976.32, running past the 50-day line and breaking a trendline. The official buy point is 998.70, according to MarketSurge. But Netflix earnings Thursday night are a huge risk.
CrowdStrike stock gained 3.7% to 392.80, above the 50-day line and clearing the 392.69 buy point.
MercadoLibre stock popped x4% to 2,118.32, rallying from the 50-day line and extending Friday's bounce from the 200-day line. Benchmark initiated coverage of the Latin American e-commerce and payments giant with a buy rating and 2,500 price target. The buy point is 2,202, but MELI stock just cleared a trendline entry.
What To Do Now
The stock market rally attempt has had a decent bounce from the April 7 lows but stalling at resistance. Trump tariffs and related news hang over everything, so it's hard to have much conviction without a follow-through day.
A number of stocks have been flashing buy signals, including Palantir, CrowdStrike and MercadoLibre. Aggressive traders could have taken a small position or two, but be ready to exit quickly and consider taking some partial profits quickly.
If the market resumes its downtrend, most of these names, which tend to have high average true ranges, will likely sell off.
Stay engaged and be flexible.
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