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Dow Jones Futures: Stock market rally awaits Fed Chairman Powell, Key Economic Data


Dow Jones futures rose slightly overnight, along with S&P 500 futures and Nasdaq futures, with Fed chief Jerome Powell and the start of key economic data collection.




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The stock market rally closes on Tuesday with Apple (AAPL) is again the drag on key stats, along with amazon.com (AMZN) and Tesla (TSLA). Meanwhile, the Dow giants of Apple Boeing airplanes (father), letter V (CVX) and Goldman book (GS) is near buy points.

Hewlett Packard Enterprise (HPE) and network application (NTAP) reported top earnings late Tuesday, with The crowd goes on strike (CRWD) and working day (DAY) begins major software reports this week.

HPE stock rises modestly in premarket trading HPE’s income top views. HP Enterprise stock, above its 200-day moving average, is operating on a long cup basis. NTAP stock plunges in prolonged action on NetApp revenue is weak and direction. WDAY stock jump overnight on a Q3 span and a $500 million buyback. CRWD stock plummeted despite beating views in Q3 due to increased sign-ups and the cybersecurity company showing a fall in Q4 revenue.

On Wednesday morning, ADP will release its private payrolls November employment estimate. The Labor Department will announce job openings in its October JOLTS report. Job openings are closely watched by Fed chief Jerome Powell, who will speak Wednesday afternoon.

All of that foreshadows the Fed’s favorite inflation gauge, the PCE price index, on Thursday morning, along with the November jobs report on Friday, as well as several other notable economic releases. .

Investors should be cautious when opening new positions until there is clearer information on the economy and the prospect of Fed rate hikes. If anything they may want to be lightening the position in very short time.

CVX goods have arrived IBD Rankings. BA goods have arrived SwingTrader.

Speech by Fed Director Powell

Fed Director Jerome Powell will speak at the Brookings Institution at 1:30 p.m. ET on Wednesday. He is expected to reinforce expectations that the central bank will move to raise rates by 50 basis points on December 14. Markets see a 67.5% chance the Fed will raise rates by half a point, but There is still a chance the Fed will raise rates for the fifth time in a row by 75 basis points. But he will also likely point out that rate hikes will continue into 2023.

Anything Powell says will be quickly overtaken by economic data. If inflation begins to cool significantly and the labor market eases, even the Fed’s most hawkish policymakers will favor slowing rate hikes and ending them sooner than expected. of the market. Hot data on prices and jobs will strengthen the resolve of many Fed pigeons. Of course, economic data in the coming days could show mixed results or marginal improvements.

Dow Jones Futures Today

Dow Jones futures are up slightly from fair value. S&P 500 futures rose 0.2%. Nasdaq 100 futures rose 0.4%.

The yield on the 10-year Treasury note fell 2 basis points to 3.73%. Crude oil futures rose 2%.

China’s official manufacturing index fell 1.2 points to 48 in November, falling further below the 50 neutral to reach 49. The services index fell to 46.7 from a forecast of 48. China’s Covid-19 shutdowns have severely damaged the economy.

However, Hong Kong’s Hang Seng index gained 2.2% after gaining 5.2% on Tuesday on hopes Covid restrictions will ease in the near term.

Remember that action overnight in future index and other places that don’t necessarily translate into actual transactions the next time stock market meeting.


Join IBD experts as they analyze stocks that could act in the stock market rally on IBD Live


Stock market recovers

After Monday’s sharp sell-off, the stock market rally ended on Tuesday.

Dow Jones Industrial Average closes just above breakeven on Tuesday stock market trading. The S&P 500 index fell about 0.2%. The Nasdaq composite index fell 0.6 percent. The Russell 2000 small-cap index rose 0.3%.

Apple shares fell 2.1%, their third significant drop in a row, as Covid-19 lawsuits in China, shutdowns and protests weighed on the tech giant. On Tuesday, the stock fell 2.6%, below its 50-day moving average. Above the 50-day line lies a 200-day resistance for AAPL stock. Apple has seen unrest at a giant Foxconn iPhone assembly plant in China.

Amazon stock fell 1.6% and Tesla stock fell 1.1%, both retreating from the 21-day moving average. Both are relatively close to bear market lows.

US crude oil prices rose 2.4% to 79.62 USD/barrel. On Monday, crude oil futures hit a year low.

The 10-year Treasury note yield rose 5 basis points to 3.75%.

ETFs

Among the best ETFsIBD 50 Innovator ETF (FFTY) fell 0.2%, while Innovator’s IBD Breakthrough Opportunity ETF (HOURS) increased by 0.5%. iShares Expanded Tech-Soft Sector Sector ETF (IGV) decreased by 0.8%. VanEck Vectors Semiconductor ETF (SMH) decreased by 0.3%.

SPDR S&P Metals & Mining ETF (XME) rose 2.3% and the Global X US Infrastructure Development ETF (PAY THE ROAD RED) 0.1%. US Global Jets ETF (jet plane) increased by 1.8%. Financial Options SPDR ETF (XLF) increased by 0.6%. Health care SPDR Foundation (XLV) decreased by 0.25%.

Reflecting more speculative stocks, the ARK Innovation ETF (ARKK) fell 0.5% and the ARK Genomics ETF (ARKG) decreased by 0.4%. Tesla stock is the primary stock held on Ark Invest ETFs.


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Dow stock near buy point

Boeing shares rose 2% to 175.32 on Tuesday, higher than 173.95 cup base buy points, follow MarketSmith Analysis. Shares have been trading closely in small volume near a buy point after a strong rally on optimism for the aerospace giant. Analysts expect Boeing to return to profitability in 2023 after four years of losses. The recent pause in BA stock has caught up to the 21-day line.

Chevron stock rose 1.45% to 180.94, slightly below the 182.50 buy point and just above the 21-day line. CVX stock has been trading around that official buy point all month. Entering early near 167 on Oct 19 is probably a safer bet initially. But with Chevron stock right at 21 days and no longer stretching from 50 days, that looks more interesting.

GS shares rose 0.35% on Tuesday to 383.71. Investment bank has a buy point of 389.68 from 35% deep cup with handle basis starting November 2021. Investors can also view the recent pause as price just above the buy range from the bottom-making base Goldman stock cleared in early November. Moving averages The 21-day line is about to catch up, while the 50-day line is starting to rally. The relative strength line is at a multi-year high reflecting GS stock’s outperformance against the S&P 500.

Analysis of market recovery

The stock market rally is backing off with key technical tests and economic data tapped, along with uncertainty over China’s Covid policies.

The S&P 500 Index is extending its downtrend from just below its 200-day moving average, but still above its 21-day line. The Russell 2000, which fell below the 200-day and 21-day line on Monday, has rebounded above the 21-day line.

The sluggish Nasdaq has dipped below its 21-day line and is closing above its 50-day line.

Shares of Apple, Tesla and other supercaps are weighing on the Nasdaq and S&P 500 indexes.

Invesco S&P 500 Equal Weight ETF (RSP) remains above its 200-day moving average.

But don’t overstate Apple’s impact. Many of the top stocks are testing either falling below buy points or circling decent gains.

Fortunately, the stock market isn’t focused on Fed speeches and key economic data. That could mean the market could recover if there are no negative surprises, with greater upside potential if upcoming headlines are positive.

But the market rally will do what it will.


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What to do now

With the market recovering, not many stocks gave buy signals. Investors should probably wait for Powell’s speech and economic data to be released before making significant new purchases. Investors may want to lock in at least part of their profits in the winning stock, especially if the winning stock is moving back to a buy point.

If the market recovers soon, a large number of stocks will be able to operate. But a lot of today’s interesting stocks will start to take a hit if the major indexes drop significantly from here.

Therefore, investors need to remain engaged and flexible. Keep your watchlist up to date but also have exit strategies for your holdings.

Read Big picture every day to stay in sync with market trends and top stocks and sectors.

Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.

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