Dow Jones futures edged higher Thursday afternoon, along with S&P 500 futures and Nasdaq futures, as US markets were closed for the Thanksgiving Day holiday. Apple, Microsoft and Tesla are in the news.
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The stock market rally was positive for the second straight day on Wednesday. Fed officials see slower rate hikes “soon” according to the Fed’s November meeting minutes released Wednesday afternoon.
The Nasdaq led, buoyed by a rebound Tesla (TSLA). The most important indices have all risen solidly in this holiday-shortened week so far. But an extended holiday for the market rally could be constructive.
With key technical resistance and notable economic reports looming, investors should be cautious about adding exposure.
However, Dexcom (DXCM), UnitedHealth (UNH), Neurocrine Life Sciences (NBIX), Medpace Holdings (MEDP) and shock wave medicine (SWAV) are five healthcare stocks that are showing interesting developments.
DXCM stock and Neurocrine Biosciences are on the IBD leaderboard, while MEDP stock is on the leaderboard watchlist. NBIX shares and Medpace are on the IBD 50.
Tesla FSD beta version
Tesla CEO Elon Musk tweeted Thursday that the full autonomous driving beta is now available to all FSD owners in North America who request it.
That could allow Tesla to recognize more deferred income from FSD.
Despite its name, Full Self-Driving does not offer full autonomous driving, but is a Level 2 driver assistance system. The National Highway Traffic Safety Administration is investigating Autopilot and FSD safety. The Justice Department is reportedly conducting a criminal investigation into Tesla’s self-driving claims.
Tesla shares rose 7.8% to 183.20 on Wednesday, recovering from Tuesday’s bear market lows as Citigroup upgraded the EV giant to a hold from a sell. TSLA stock is still down 19.5% so far this month and has roughly halved through 2022.
News on Dow stock trades
In Dow Jones stock market news, Apple (AAPL) is said to be interested in buying the British soccer giant Manchester United (MANU). The Federal Trade Commission can try to block them Microsoft (MSFT) deal to buy Activision Blizzard (ATVI) for nearly $69 billion.
Dow Jones futures today
Dow Jones futures rose 0.1% from fair value. S&P 500 futures were up 0.2% and Nasdaq 100 futures were up 0.4%.
Mainland China reported more than 31,000 Covid cases, including those without symptoms, surpassing levels seen in mid-April during Shanghai’s lockdown. Covid infections with symptoms are still below April peaks.
US stock markets will remain closed on Thursday for the Thanksgiving Day holiday. On Friday, US stock markets close early at 1 p.m. ET. But other exchanges around the world are also open as normal on Thursdays and Fridays.
Keep in mind that overnight action in Dow futures and elsewhere doesn’t necessarily translate to actual trading in the next regular trading session.
Join IBD experts as they analyze actionable stocks in the stock market rally on IBD Live
stock market rally
The stock market rally had some jitters on Wednesday but extended gains led by techs.
Initial jobless claims rose to a three-month high, while ongoing claims hit an eight-month high. The S&P Global manufacturing and services purchasing managers’ indices in the US both signaled a decline.
Fed minutes boosted expectations of a 50 basis point rate hike at the December 14th meeting. Markets still favor another half-point move in February, but there’s a good chance of a quarter-point hike.
The Dow Jones Industrial Average rose 0.3% in trading on Wednesday. The S&P 500 index rose 0.6%, led by TSLA stock. The Nasdaq Composite rose 1%. Small-cap Russell 2000 gained 0.1%.
US crude prices fell 3.7% to $77.94 a barrel. Natural gas futures rose 7.2%.
The 10-year government bond yield fell 5 basis points to 3.71%. The two-year Treasury yield, which is more closely linked to the Fed’s rate hike outlook, slipped below 4.5%.
The US dollar fell sharply for the second consecutive month, falling back near recent lows.
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ETFs
The iShares Expanded Tech-Software Sector ETF (IGV) rose 1.5%. The VanEck Vectors Semiconductor ETF (SMH) is up 0.9%.
The SPDR S&P Metals & Mining ETF (XME) edged up 0.3%. The US Global Jets ETF (JETS) was up 0.1%. The SPDR S&P Homebuilders ETF (XHB) was up 0.5%. The Energy Select SPDR ETF (XLE) fell 1.1%. The Health Care Select Sector SPDR Fund (XLV) rose 0.4%. Dow Jones giant UNH stock is the top holding in XLV.
Reflecting more speculative story stocks, ARK Innovation ETF (ARKK) was up 2.9% and ARK Genomics ETF (ARKG) was up 0.9%. TSLA stock is a key position in Ark Invest’s ETFs.
The five best Chinese stocks to watch right now
stocks to look at
Dexcom shares rose 1.7% to 112.92 and found support at the 21-day moving average. DXCM stock paused this month after rising against earnings on Oct. 28. Dexcom stock is arguably a long price with a buy point of 123.46 from a seven month consolidation. Investors could buy DXCM shares on an early entry outside the 21-day moving average, perhaps using Tuesday’s high of 113.88 as a specific buy point.
Medpace shares fell 1.3% to 218.81 on Wednesday. Shares have consolidated near record highs since skyrocketing 38% on Oct. 25 following gains. Since then, MEDP stock has forged a messy grip on a deep, year-round cup base. While shares have had some large intraday swings, MEDP stock is currently on course to form a tight three-week pattern through Friday’s close. Investors could use 226.57 15th November close as an early entry, up above most of recent trade.
NBIX shares fell 1.5% to 118.97. Stocks are consolidating near multi-year highs prolonged by a breakout in October. Despite collapsing to the 50-day moving average over the past week, Neurocrine stock is exhibiting a three-week tight pattern that’s on track for a fourth week. Technically that has a buy point of 126.09 although perhaps investors should wait for quieter action.
Shockwave stock rose 4.7% to 264.06 on Wednesday, back above its 21-day moving average but encountered resistance at the 50-day moving average. After a failed breakout in late October and a sharp sell-off that continued through gains, SWAV stock has bounced back over the past week. A new base will take more time, but aggressive investors could use a strong move above the 50-day level as an early entry.
UNH stock rose 1.3% to 529.71 and rallied above its 50-day and 21-day moving averages after briefly breaching its 200-day moving average last week. UnitedHealth stock was a former IBD Long-Term Leader and still shares many characteristics. Investors could use a bounce off the 50-day moving average as either an early entry or a long-term leader entry. UNH stock needs to find a new footing after a swift failure to break out of a cup-and-handle base last month.
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Analysis of the market rally
The stock market rally added to Tuesday’s gains. The S&P 500 just surpassed its Nov. 15 intraday high and closed within 1% of its 200-day moving average.
The Russell 2000 came right up to its 200-day moving average.
The Nasdaq contributed to its rebound from Tuesday’s 21-day moving average, although it is still below its Nov. 15 short-term high and well below its 200-day moving average.
The Dow Jones came within 20 points of its August 16 intraday high.
The S&P 500 moving decisively above its 200-day moving average — which roughly coincides with a one-year trendline with falling spikes — is a major test for the market rally.
A series of economic data could shake the Fed’s interest rate expectations and thus the stock market. On Wednesday, November 30, the October JOLTS report will show job vacancies, with Fed Chair Jerome Powell to speak later in the day. On Thursday, the PCE price index, the Fed’s favorite indicator of inflation, will be released along with jobless claims and the ISM manufacturing index. The November jobs report is due on Friday 2 November.
Ideally, the market would trade sideways for a few days and at least let the 21-day moving average catch up to get to these economic reports.
Time the market with IBD’s ETF market strategy
What now
The market rally has shown some nice gains this week, with more stocks showing buy signals over the past few days. Investors could therefore have added a little more exposure.
But they should be cautious about making significant new purchases as the S&P 500 hovers below its 200-day moving average and so much Fed-critical economic data is due next week.
Also, consider taking some partial profits on stocks that are rising fast. Stocks have made short-lived gains amid a choppy uptrend and sector rotation.
Still, investors should work hard on their investment shopping lists, looking for startups and actionable names across a variety of sectors.
Read The Big Picture every day to keep up to date with market direction and leading stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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