Dow Jones futures edged higher Friday morning, while S&P 500 futures and Nasdaq futures fell slightly. Apple headlined earnings reports overnight with the October jobs report due before the open.
The stock market rally continued to roar Thursday, with the S&P 500 and Dow Jones staging their own follow-through days after the Nasdaq confirmed the uptrend Wednesday. The Nasdaq and S&P 500 moved above resistance areas as Treasury yields continued to tumble. Market breadth was much better Thursday.
Eli Lilly, Weatherford, Palo Alto Networks, Palantir Technologies, Lululemon Athletica and Ferrari flashed buy signals Thursday.
AAPL stock fell overnight. Apple earnings topped views, but sales fell again and the iPhone maker guided lower on holiday-quarter revenue.
LLY stock is on IBD Leaderboard. WFRD stock and Palo Alto are on SwingTrader. Ferrari, Lululemon and PANW stock are on the IBD 50. RACE stock is on the IBD Big Cap 20. Eli Lilly was Thursday's IBD Stock Of The Day.
Jobs Report
The October jobs report is due at 8:30 a.m. ET. Economists expect nonfarm payrolls to rise by 179,000, cooling from September's 336,000. The now-ending UAW strike likely weighed on net jobs during the month. The jobless rate is expected to hold at 3.8%. Average hourly earnings are seen climbing 0.3%, with the yearly gain slowing to 4%.
The jobs report follows mixed-to-weak economic reports during the week, which have helped rein in Treasury yields and fuel the new stock market rally. So strong October employment data could trigger a big negative reaction.
Dow Jones Futures Today
Dow Jones futures tilted higher vs. fair value. S&P 500 futures lost about 0.1%. Nasdaq 100 futures sank 0.2%. Apple stock is a Dow Jones, S&P 500 and Nasdaq component.
The 10-year Treasury yield edged lower to 4.64%.
The October jobs report will be sure to swing Dow futures and Treasury yields before the open.
Crude oil futures climbed nearly 1%.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
FTX Founder SBF Found Guilty
A federal jury found Sam Bankman-Fried, founder of the failed FTX cryptocurrency exchange, guilty on all seven fraud and conspiracy charges Thursday night. The former FTX CEO faces up to 110 years in prison.
Key Earnings
In addition to Apple stock, Kratos Defense & Security Solutions, DraftKings, Yelp, Coinbase Global, Carvana, Atlassian, Cloudflare and Fortinet all reported late Thursday.
Winners: DKNG stock jumped overnight and YELP stock rose; both signaled early entries.
Losers: FTNT stock crashed for a second straight earnings report on weak revenue and guidance. Cloudflare and TEAM stock also were losers. CVNA stock fell modestly after initially jumping overnight after beating on a variety of profit measures, in part due to special factors.
COIN stock fell solidly after nearly breaking even, but trading volume keeps falling. Cryptocurrency exchange Coinbase jumped in Thursday, approaching an early entry. KTOS stock fell modestly, holding within a buy zone after beating views.
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Stock Market Rally
The stock market rally had another strong session in higher volume Thursday, with generally positive earnings and tumbling Treasury yields providing the tailwind.
The Dow Jones Industrial Average leapt 1.7%, or 564 points, in Thursday's stock market trading. The S&P 500 index jumped 1.9%. The Nasdaq composite ran up 1.8%.
The Dow Jones and S&P 500 staged follow-through days on the fourth day of their rally attempts Thursday, providing further confirmation for the new uptrend. That came after the Nasdaq staged a Day 4 follow-through day on Wednesday.
Back-to-back FTDs don't happen that often, so it's a positive sign.
The Nasdaq moved above its 21-day line Thursday, with the S&P 500 reclaiming the 200-day and 21-day averages. Both are coming up to their 50-day moving averages. The Dow Jones cleared its 200-day and is just below its 50-day.
The major indexes moving decisively above the 50-day line will be key for the market rally.
Market breadth, just so-so on Wednesday, was decisively bullish on Thursday. The small-cap Russell 2000 raced 2.7% higher and the Invesco S&P 500 Equal Weight ETF jumped 2.2%, both clearing their fast-falling 21-day averages. Both are still well below the 200-day and 50-day lines.
The First Trust Nasdaq 100 Equal Weighted Index ETF leapt 2.1% to just below its 200-day line.
Many of the stocks flashing buy signals in the past few days paused Thursday, such as Meta Platforms, though some such as ServiceNow kept rising, at least modestly.
On Thursday, several stocks gapped up on earnings within bases, sometimes moving into possible buy areas, including Roku, DoorDash, Shopify, PLTR stock and even Ferrari. Investors could wait to see if some of these names pause for a few days, creating new buying opportunities.
U.S. crude oil prices jumped 2.5% to $82.46 a barrel.
The 10-year Treasury yield tumbled 12 basis points to 4.67%, getting as low as 4.63% intraday. The 10-year bond yield gapped below its 21-day line but is still above the 50-day.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF bounced 1.7%, with Palo Alto and PLTR stock both members. The VanEck Vectors Semiconductor ETF jumped 2.6%.
Reflecting stocks with more speculative stories, the ARK Innovation ETF spiked 8.4% and ARK Genomics bounded 4.8%. COIN stock is the No. 1 holding across ARK Invest's ETFs. DKNG stock is a top 10 Cathie Wood stock, with ARK also owning a fair amount of Palantir stock.
The SPDR S&P Metals & Mining ETF gained just over 2%. SPDR S&P Homebuilders stepped up 2.2%. The Energy Select SPDR ETF bounced 3%, and the Health Care Select Sector SPDR Fund climbed 1.6%. LLY stock is a major XLV holding.
The Industrial Select Sector SPDR Fund advanced 2.1%. The Financial Select SPDR ETF rose 2.4%, while the SPDR S&P Regional Banking ETF surged 5.7%.
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Apple Earnings
Apple earnings modestly topped fiscal Q4 views, and the Dow Jones tech titan's sales edged past targets. But revenue fell vs. a year earlier for a fourth straight quarter. China sales missed forecasts amid multiple headwinds there. On the conference call, Apple executives suggested that holiday first-quarter sales would be in line with Q4, below Wall Street estimates.
Apple stock fell modestly after hours. Shares rose 2.1% to 177.57 in Thursday's session, moving above the 50-day line, a day after retaking the 200-day. AAPL stock has a 198.23 official buy point. Investors could use a downward-sloping trendline or a short-term high of 182.34 as early entries.
Stocks In Buy Areas
Eli Lilly stock popped 4.7% to 580.29 on Thursday, moving back above the 50-day line. Intraday, shares hit 597.44, breaking a trendline going back to the Oct. 13 high of 629.97. Early Thursday, Eli Lilly reported a surprise profit as sales growth accelerated for a second straight quarter. Sales of diabetes/weight-loss drug Mounjaro skyrocketed 652% to $1.41 billion.
WFRD stock rose 4% to 99.11, clearing a 97.88 buy point from a shallow cup-with-handle base. The relative strength line is at highs for the oil machinery play.
PANW stock popped 2.25% to 250.36, breaking a short downward-sloping trendline and extending Wednesday's move off the 21-day line. Palo Alto stock is still within a consolidation going back nearly four months. PANW stock fell overnight in sympathy with Fortinet and Cloudflare.
PLTR stock spiked 20% to 17.97, vaulting above the 50-day and briefly clearing a trendline. Intraday, shares hit 18.30, just below a short-term high of 18.44. That could serve as an early entry, or perhaps Palantir stock could forge a handle around current levels, letting the 50-day line start to catch up. The official buy point is 20.24. Early Thursday, Palantir topped earnings views and gave bullish guidance.
LULU stock climbed 2.1% to 403.50, breaking a short downtrend and continuing Wednesday's bounce from the 50-day. That offered an early entry. Investors also could use the still-valid 406.94 official flat-base buy point. Volume has been light in the recent bounce, but the relative strength line is right around 52-week highs.
RACE stock gapped up just over 6% to 323.42 after the luxury sports car maker reported a fourth straight quarter of accelerating earnings and sales growth, and raised its revenue outlook. Ferrari stock broke a trendline and a short-term high, offering an early entry. The official buy point is 329.88, according to MarketSmith. Ferrari stock is not extended from its 50-day line, but ideally it would pause or forge a handle around current levels. The RS line is already at highs.
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What To Do Now
The stock market rally showed strong follow-on action to the Nasdaq's follow-through day, a positive sign. There were new buying opportunities, though several came on big earnings gaps that come with some added risks.
It's time to be adding exposure, but do so gradually. As the overall market rally and your holdings make progress, you can make some new buys. If the market keeps trending higher, it won't take long to be significantly invested.
Friday's jobs report could be key for Treasury yields, which remain the dominant market driver. The Apple earnings reaction could swing markets. More broadly, earnings season remains active. There were some huge earnings winners Thursday, but also some massive losers.
It's definitely a time to have your watchlists up to date. Stocks that were looking weak are suddenly looking much better. You'll want a broad watchlist to track the broadening leadership, but you should also focus on a select group of names.
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