Dow Jones futures rose slightly early Wednesday, along with S&P 500 futures and Nasdaq futures. The Federal Reserve meeting announcement is on tap, with Fed chief Jerome Powell's comments about the central bank's rate outlook key.
The stock market ended a two-day bounce on Tuesday, with the Nasdaq leading the decline.
Nvidia CEO Jensen Huang unveiled new AI chips in his GTC keynote address, but Nvidia stock retreated. Broadcom, Taiwan Semiconductor and Super Micro Computer also lost ground.
Tesla sold off Tuesday amid a variety of headlines. TSLA stock is once again the S&P 500's worst performer this year. Shares rose in premarket trade on a taxi-related permit.
The video embedded in the article highlights Tuesday's market action and analyzes Mueller Water Products, T-Mobile US and EverQuote.
Dow Jones Futures Today
Dow Jones futures rose a fraction vs. fair value. S&P 500 futures advanced 0.2% and Nasdaq 100 futures climbed 0.4%.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
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Nvidia CEO Unveils New AI Chips
Nvidia CEO Jensen Huang remained bullish about AI at the company's annual GTC event, seeing huge growth and opportunities ahead.
Nvidia's Huang unveiled Blackwell Ultra chips, set to ship in the second half of 2025. He also touted Vera Rubin, its next-generation chips for 2026.
The chipmaker is collaborating with General Motors on autonomous vehicles, factories and robots using AI, simulation and accelerated computing, he said.
Nvidia stock sank 3.3% to 115.53 after falling back below its 21-day line on Monday. NVDA stock is off six-month lows but some distance from its 50-day and 200-day lines. Shares rose slightly early Wednesday.
Broadcom stock gave up 3% Tuesday. AVGO stock is holding above its 200-day, but is below a sliding 50-day, according to MarketSurge.
Taiwan Semiconductor stock declined 1.4% Tuesday. TSM, which makes AI chips for Nvidia, Broadcom and others, is below its 200-day line.
Supermicro stock sold off 9.6% Tuesday. The AI server maker and Nvidia partner fell to its 50-day. SMCI stock remains far below its March 2024 peak of 122.90.
Fed Meeting
The Fed's two-day meeting ends Wednesday afternoon, with the central bank's policy statement due at 2 p.m. ET. No rate moves are expected Wednesday, but investors will be looking for hints about Fed rate cuts in May or June.
The Fed will release new quarterly economic projections at 2 p.m. ET, as well as policymakers' latest "dot-plot" of where they think rates will be at year-end. Fed chief Powell will hold a press conference at 2:30 p.m. ET.
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Stock Market Tuesday
The stock market saw renewed selling, led by the Nasdaq.
The Dow Jones Industrial Average declined 0.6% in Tuesday's stock market trading. The S&P 500 index fell 1.1%. The Nasdaq composite tumbled 1.7%. The small-cap Russell 2000 dropped 0.9%.
The Invesco S&P 500 Equal Weight ETF declined 0.5, backing off the 200-day line. The First Trust Nasdaq 100 Equal Weighted Index ETF sank 1.15%.
A market rally attempt is still underway on the major indexes, which have not undercut their most recent lows. A follow-through day could take place at any time, though the risks of failure would be high.
A number of growth stocks fell from or below their 50-day moving averages after positive moves Monday, including Palantir Technologies and Netflix.
Gold, China and insurers remain areas of strength, but some Chinese and insurance stocks retreated Tuesday.
U.S. crude oil prices fell 1% to $66.90 a barrel.
The 10-year Treasury yield declined two basis points to 4.28%.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF declined 0.6%. The iShares Expanded Tech-Software Sector ETF declined 1.5%. The VanEck Vectors Semiconductor ETF skidded 1.55%. Nvidia stock is the No. 1 holding in SMH.
ARK Innovation ETF tumbled 3.5% and ARK Genomics ETF gave up 3.55%. Tesla stock is the largest component across ARK Invest's ETFs.
SPDR S&P Metals & Mining ETF climbed 0.4%. The Energy Select SPDR ETF edged up 0.2%. and the Health Care Select Sector SPDR Fund rose a fraction.
The Industrial Select Sector SPDR Fund declined 0.8%.
The Financial Select SPDR ETF dipped 0.1%.
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Tesla Stock
Tesla stock fell 5.3% to 225.31 on Tuesday. Various Tesla China news pointed to lackluster demand for the refreshed Model Y, as more analysts slash price targets and estimates for deliveries and earnings, citing brand destruction in the U.S. and Europe.
BYD unveiled superfast charging on Monday while Zeekr on Tuesday joined BYD, XPeng and others in offering driver-assistance systems for free. That raises the bar for Tesla in China, the world's largest EV market.
RBC Capital slashed its TSLA price target Tuesday, citing weaker prospects for Tesla Full Self-Driving, especially in China.
The Nvidia-GM collaboration on self-driving cars is a knock on analyst models for Tesla to license FSD to other automakers.
TSLA stock is now down 44.2% in 2025, once again the worst performer in the S&P 500.
But shares rose in premarket trade after California late Tuesday gave Tesla approval to drive its employees in its EVs, later transporting the public. While technically a step toward robotaxis, the permit is related to taxis, not the robo part.
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What To Do Now
The stock market is deeply divided. Gold, China and insurance stocks are among the areas that are doing well, while tech plays are generally in terrible shape. Divided markets offer some opportunities, at least for short-term trades, but also plenty of risk.
Investors should be very cautious in the current market, with minimal exposure or entirely in cash.
The market could confirm its rally attempt with a follow-through day in the next few days, perhaps after Wednesday's Fed meeting announcement and Powell's comments. But the risk of a failed FTD would be high.
Definitely have your watchlists up to date. Look for setups, but also stocks with strong relative strength that aren't in position.
Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
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