Dow Jones futures were little changed early Friday, along with S&P 500 futures and Nasdaq futures. Applied Materials reported earnings after the close, with Reddit-OpenAI partnership also in focus.
The stock market rally had a quiet Thursday. The major indexes nudged into fresh all-time highs, with the Dow Jones briefly topping 40,000 before the major indexes retreated for slim losses, holding the bulk of Wednesday's big gains.
Dow giant Walmart gapped out of a base Thursday on strong earnings. Tesla rival BYD, Trade Desk, Marvell Technology, MercadoLibre, and Costco Wholesale also moved into buy areas.
They join Nvidia which broke out Wednesday. Shares edged higher Thursday, still in buy range.
Nvidia stock is on IBD Leaderboard and the IBD 50. Nvidia, MercadoLibre and COST stock are on SwingTrader. Copart stock is on the IBD Long-Term Leaders list. Costco was Thursday's IBD Stock Of The Day.
Dow Jones Futures Today
Dow Jones futures edged lower vs. fair value. S&P 500 futures lost a fraction and Nasdaq 100 futures rose slightly.
The 10-year Treasury yield edged up to 4.39%.
China retail sales in April rose 2.3% vs. a year earlier, down from March's 3.1% and estimates for 3.8%. Industrial production climbed 6.7%, picking up from 4.5% and topping forecasts for 5.5%.
Fixed-asset investment in the first four months of the year climbed 4.2%, below targets for 4.6. Real estate investment tumbled 9.8% year to date.
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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Earnings, News
Applied Materials earnings and guidance beat views, but AMAT stock declined slightly overnight. Shares fell 1.5% to 214.17 on Thursday, back into the base. Applied Materials stock rallied 3.7% on Wednesday to clear a 214.91 flat-base buy point.
Copart earnings were in line, with CPRT stock falling slightly in extended action. The salvage auto auction company declined 1.4% to 54.55 on Thursday, hitting resistance at the 50-day line. Copart stock has a 58.58 flat-base buy point, according to MarketSurge.
Reddit soared on a new partnership with Microsoft-backed OpenAI.
Stock Market Rally
The stock market rally rose Thursday morning, fading for slim losses, but it was a relatively tame session.
The Dow Jones Industrial Average fell 0.1% in Thursday's stock market trading. The S&P 500 index declined 0.2%. The Nasdaq composite lost nearly 0.3%. The small-cap Russell 2000 gave up 0.7%, but is still on track for a fourth straight solid weekly advance.
Leading stocks continue act well, as they generally have since early May. A few more flashed buy signals while others kept rising or at least held the bulk of Wednesday's strong moves.
Exceptions included some infrastructure and building material plays such as Martin Marietta and Eagle Materials, which suffered solid losses.
U.S. crude oil prices rose 0.8% to $79.23 a barrel.
The 10-year Treasury yield rose two basis points to 4.38% after sharp recent losses.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF dipped 0.3%. The VanEck Vectors Semiconductor ETF ceded 0.7%. Nvidia, Applied Materials, Monolithic Power and MRVL stock are in SMH.
Reflecting more-speculative story stocks, ARK Innovation ETF lost 1.8% and ARK Genomics ETF declined 1.3%. Tesla stock is the largest holding across Ark Invest's ETFs. Cathie Wood's Ark also has a small stake in BYD.
SPDR S&P Metals & Mining ETF gave up 0.6%. The Global X U.S. Infrastructure Development ETF shed 1.8%. The SPDR S&P Homebuilders ETF slumped 2.7. The Energy Select SPDR ETF dipped 0.3% and the Health Care Select Sector SPDR Fund edged down 0.1%.
The Industrial Select Sector SPDR Fund fell 0.6%. The Financial Select SPDR ETF closed just above break-even.
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Stocks In Buy Zones
Walmart stock gapped up 7% to 64, clearing an extremely shallow double-bottom base with a 60.89 buy point. Shares are now slightly extended Walmart earnings rose 22% vs. a year earlier, the second straight quarter of accelerating growth and the best gain in three years.
Costco stock edged up 0.8% to 793.07, moving into the buy zone of a shallow cup base. The buy point is 787.08. Costco, which has earnings in late May, got a boost Thursday from Walmart earnings.
Trade Desk stock popped 3.3% to 93.19, closing well off highs but clearing a 92.19 handle buy point in huge volume. Late Wednesday, Netflix said it has 40 million subscribers for its ad-supported tier. Trade Desk will be a Netflix programmatic advertising partner, joining Microsoft and others.
Nvidia stock dipped 0.3% to 943.46. Shares are in range of a 922.20 cup-with-handle buy point. The AI chip leader broke out Wednesday with a 3.6% gain. But Nvidia earnings on May 22.
Marvell stock jumped 4.1% to 73.03, decisively clearing the 50-day line and offer an early entry. MRVL stock has a double-bottom base with a 76.29 entry. Marvell earnings are due in late May, but Nvidia earnings could swing the data center chipmaker.
MercadoLibre stock rose 1.2% to 1,739.15, just clearing a 1,731.38 cup-with-handle buy point. Investors could have bought MELI stock Wednesday as it broke the downtrend of its small handle. The handle formed after the Latin American e-commerce and payments giant surged following earnings earlier this month.
BYD stock rose 1.8% to 28.70, rebounding from the 200-day moving average and breaking a short downtrend, offering an early entry. Shares have a 29.72 buy point from what's either a high handle to a short consolidation or a traditional handle to a base going back to late 2023. BYD is the only EV stock that's positive in 2024, aside from China rival Zeekr, which just public last week.
In the past week, BYD has launched the Sea Lion crossover, a Model Y rival, and the Shark plug-in hybrid pickup truck. BYD is likely to reclaim the lead in full battery electric vehicles (BEVs) in the second quarter from Tesla.
As for Tesla, shares rose 0.5% to 174.87, rising slightly off the 50-day line. TSLA stock remains well below the 200-day.
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What To Do Now
The stock market rally took a breather after Wednesday's big move, which is normal.
Nvidia earnings next week will have a big market impact, but especially on AI plays. So consider how much exposure you have to AI chips and AI plays generally heading into those results.
But generally, investors should be looking to have heavy exposure. The major indexes are at highs while leading stocks are acting well and providing plenty of opportunities.
Many are still setting up, so work on those watchlists.
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