Dow Jones futures, along with S&P 500 futures and Nasdaq futures, will open on Sunday evening, kicking off a new week of trading. After struggling for much of the week, the stock market rally made a bullish move on Friday. The major indexes staged an upside reversal, and several stocks flashed buy signals, indicating a potential opportunity for investors.
Among the stocks that cleared buy points or early entries and showed strong performance relative to the S&P 500 were Nvidia, Meta Platforms, Arista Networks, Qualys, Eli Lilly, CME Group, Vertiv Holdings, CrowdStrike Holdings, Cadence Design Systems, and Palo Alto Networks. These stocks, along with Tesla, which rebounded from key support, are worth considering for investors’ watchlists.
Some of these stocks, such as Nvidia, Meta Platforms, Arista Networks, Vertiv, and Tesla, are included on IBD Leaderboard, while Palo Alto Networks and Meta Platforms are featured on SwingTrader. CDNS stock is listed on IBD Long-Term Leaders, and the likes of Nvidia, Tesla, Palo Alto, and Arista Networks are part of the IBD Big Cap 20. Eli Lilly was the IBD Stock Of The Day on Friday, and CrowdStrike, Arista Networks, and Palo Alto Networks were also selected during the week.
Dow Jones futures will open at 6 p.m. ET on Sunday, along with S&P 500 futures and Nasdaq 100 futures. However, it is important to note that overnight action in futures markets doesn’t always translate directly into actual trading during regular stock market sessions.
The stock market struggled for much of the week, with the Dow Jones and S&P 500 undercutting recent lows. However, the Nasdaq rally attempt continued, and on Friday, the major indexes staged a bullish upside reversal in higher volume, with leading stocks powering higher. The Dow Jones Industrial Average edged down 0.3% for the week but gained 0.9% on Friday. The S&P 500 rose 0.5%, rebounding from the 40-week line, while the Nasdaq composite jumped 1.6% for the week, pushing above the 21-day line. The small-cap Russell 2000 slumped 2.1% for the week after hitting five-month lows.
Market breadth has been weak for weeks or months, although Friday saw positive breadth. The 10-year Treasury yield surged to 4.78%, but closed below Friday’s early peak of 4.89%. The 10-year bond yield did rise slightly on Friday, but the dollar retreated for a third straight session. Crude oil and gasoline futures experienced significant declines last week, presenting challenges for the energy sector.
Among the ETFs, growth stocks saw mixed performances. The Innovator IBD 50 ETF advanced 0.5% last week, while the iShares Expanded Tech-Software Sector ETF popped 2.2%. Cybersecurity plays CRWD stock, Qualys, and Palo Alto are members of the IGV. The VanEck Vectors Semiconductor ETF gained 2.3%, with Nvidia stock holding the top spot. ARK Innovation ETF fell 1.2%, and ARK Genomics ETF tumbled 5.7%. Tesla stock remains the top holding in Ark Invest’s ETFs. Meanwhile, SPDR S&P Metals & Mining ETF slid 3.2%, and the Global X U.S. Infrastructure Development ETF edged down 0.4%.
Now, let’s explore some individual stocks that are currently in buy zones. Nvidia stock rose 2.4% last week, clearing the 50-day line and offering an early entry. As of Friday’s close, it has a new base with a 502.66 buy point. Meta stock jumped 3.5% on Friday, clearing a cup-with-handle buy point of 310.64 as well as a 312.87 entry. Arista stock surged 45.5% for the week, clearing an early entry of 189.90. Eli Lilly stock presented a buying opportunity by bouncing from its 50-day line on Friday. Qualys stock jumped 4% on Friday, clearing short-term resistance around 155 as well as a recent 52-week high of 157.88. CrowdStrike stock vaulted from the 21-day line on Friday, clearing several months of consolidation. Palo Alto stock leapt from near the 50-day line on Friday, and CME stock displayed an impressive rally after bouncing from the 50-day line. Vertiv stock rallied from the 21-day and 10-week lines, clearing short-term levels. Cadence Design stock rebounded from the 50-day line and broke the downtrend of a handle. Finally, Tesla stock popped 4.1% for the week, and although it fell back to the 50-day line on Friday morning, it rebounded slightly. A move above Thursday’s intraday high could present a new early entry from breaking a downtrend in the handle. Tesla stock has a cup-with-handle base with a buy point of 278.98.
Despite a flurry of what seemed like bad news, Tesla stock showed surprising strength. The company reported third-quarter deliveries that fell more than expected, but it also launched a new, lower-priced Model Y and cut prices for some models. Investors are looking forward to upcoming product releases and betting on long-term prospects for self-driving, AI, and robotics.
In conclusion, the stock market rally is showing signs of strength, with major indexes staging an upside reversal and many leading stocks flashing buy signals. It is important for investors to prepare their watchlists and gradually add exposure if the market continues to perform well. However, it is crucial to stay cautious and be ready to step back if the market or positions start to falter.