Dow Jones futures sold off early Wednesday, along with S&P 500 futures and Nasdaq futures. credit Suisse ,C) faltered as its top shareholder declined to invest more in the ailing Swiss bank.
The stock market jumped on Tuesday, despite a strong rally in major indexes for most of the afternoon. February’s CPI inflation rate cooled in line with expectations, but the report gave banks second billing.
Market rally is underway. But amid such a volatile, news-driven environment, investors should remain cautious.
Many stocks showed a bullish trend on Tuesday. meta platform ,meta) showed a buying signal as the parent of Facebook and Instagram announced another wave of layoffs. Tesla ,TSLA) overturned from key support. boeing ,B. A, lantheus ,lnth, Applied Materials ,amat, MSCI ,MSCI, fortinet ,ftnt) And MercadoLibre ,Melee) are doing business near all purchase points.
Meta Stock is on SwingTrader. FTNT stock and MSCI IBD are on long-term leaders. MELI Stock, Monolithic Power, Fortinet and Lantheus are on IBD 50, Fortinet and AMAT shares are on the rise IBD Big Cap 20,
The video embedded in the article discusses Tuesday’s market action and analyzes Meta Platforms, Fortinet and BA Stock.
lenar ,lane) handily beat estimates for the fiscal first quarter late Tuesday, while the homebuilder raised guidance on Q2 orders.
LEN stock climbed 1% in extended trading. Shares jumped from the 50-day line on Tuesday, rising 1.8% to 100.77. Lennar stock is trading at flat basis buy point of 109.38. Investors can use the move above Tuesday’s intraday high of 101.78 as an opening entry.
Credit Suisse leads European bank selling
Credit Suisse stock fell 20% in premarket trading as the Saudi National Bank, its top shareholder, ruled out any further investment. The Swiss banking giant has fallen in recent months, revealing poor internal controls earlier this week. Credit default swaps indicate an increased risk for Credit Suisse. Deutsche Bank ,database) and other European financials were notable losers early on Wednesday. Business came to a standstill in many European banks.
The selloff affected major US banks in premarket trade, such as JPMorgan Chase ,jpm) And Wells Fargo ,WFC), which increased on Tuesday.
regional bank First Republic Bank ,FRC) And Western Alliance Bancorp ,wall) was little changed early Wednesday, while PacWest Bancorp ,pacw) fell. All three made big comebacks despite closing higher on Tuesday. charles schwab ,schw) also retreated after Tuesday’s surge.
dow jones futures today
Dow Jones futures fell 1.5% versus fair value in volatile trading, with S&P 500 futures falling 1.6% and Nasdaq 100 futures falling 1.3%.
The 10-year Treasury yield fell 10 basis points to 3.52% after rising earlier. The 2-year yield fell 20 basis points to 4.02%. Markets expect a quarter-point Fed rate hike in March, but see a pause in May and rate cuts through the summer.
The dollar rose despite a fall in US yields.
Crude oil futures fell marginally. Copper futures lost more than 1%.
China’s industrial production for January-February rose 2.4% from a year earlier, down from a view of 2.6%. Retail sales climbed 3.5%, matching forecasts. Fixed-asset investment rose 5.5%, topping consensus, but real estate investment sank 5.7%.
Remember that overnight action in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
Join IBD experts as they analyze actionable stocks in Stock Market Rally on IBD Live
stock market rally attempt
The stock market opened strongly on Tuesday, but with some big swings.
The Dow Jones Industrial Average rose 1.1% in Tuesday’s stock market trading. The S&P 500 index jumped 1.65%, with FRC stock, Schwab and Meta Platforms among the top performers. The Nasdaq Composite jumped 2.1%. The small-cap Russell 2000 claimed 1.9%.
US crude oil prices fell 4.6% to $71.33 per barrel. Copper futures lost 1.45%.
The 10-year Treasury yield rose 12 basis points to 3.63%. The 2-year Treasury yield rose 19 basis points to 4.22%.
Among growth ETFs, the Innovator IBD 50 ETF (ffty) climbed 2.5%. iShares Extended Tech-Software Sector ETF (IGV) advanced 2.3%. VanEck Vectors Semiconductor ETF (SMH) jumped 3%.
Reflecting more speculative stocks, the ARK Innovation ETF (ARKK) 2.1% and the ARK Genomics ETF (arkg) 1.5%. Tesla stock is a major holding in Arc Invest’s ETF.
SPDR S&P Metals & Mining ETF (XME) 0.8% and the Global X US Infrastructure Development ETF (pave) 1.7%. US Global Jets ETF (jet) dropped 0.6%. SPDR S&P Homebuilders ETF (xhb) LEN stock rose 1.4% with XHB Holding. Energy Select SPDR ETF (XLE) climbed 1%. Health Care Select Sector SPDR Fund (xlv) was up 0.9%
Five Best Chinese Stocks to Watch Now
TSLA stock jumped 5% on Tuesday to 183.26 after finding support at its 50-day line on Monday, though shares are still below the 21-day line. Tesla’s strong China EV registrations fueled Tuesday’s gains. The EV giant is working on a possible lower base with a 217.75 buy point. It is forming below the 200-day line, but a breakout would certainly involve a clearing of the 200-day.
Meta Platforms announced on Tuesday that it will cut another 10,000 jobs in the coming months. It confirmed another major wave of layoffs after 11,000 cuts in November.
Meta stock jumped 7.25% to 194.02. As per MarketSmith analysis, the shares are trading at a buy point of 197.26 on a forged basis after Q4 earnings gap. , But investors could use a downward sloping trendline or a move above the March 7 high of 190.36 as an opening entry.
The Relative Strength Line is at its highest level since May, reflecting Meta Stock’s outperformance in recent months versus the S&P 500 Index.
Stocks near Buy Points
BA stock moved above its 50-day line on Tuesday morning, flirting with a trendline entry after rebounding on Monday from two-month lows. But the Dow Jones aerospace giant closed down just 1.9% to 207.28 from its 50-day low. Boeing stock is on track to hold a new flat base after Friday with a 221.43 buy point.
On Tuesday, Boeing received 78 confirmed orders for 787 Dreamliner jets from two Saudi Arabian airlines, with options for 43 more.
LNTH stock rose 3.2% to 73.02 on Tuesday, although shares closed lower. On Monday, Lantheus stock made a comeback from the 21-day line. Investors can still use 75.20 as a cup-with-handle buy point, but 77.04 may soon be a better handle entry.
AMAT stock fell 3.9% to 120.34 on Tuesday after bouncing off its 50-day line on Monday. The stock is trading at 125.02 flat, which is part of a base-on-base formation. Applied Materials stock can use Tuesday’s high above 121.24 as an initial entry. The RS line for AMAT stock is at a 52-week high.
The MSCI stock rose 3.8% to 548.25, extending Monday’s jump from the 50-day line. The MSCI stock has a 572.60 buy point from a long, deep cup-with-handle base. But it showed an early entry from a down-sloping trendline or move above the March 7 intraday high of 547.92.
FTNT stock climbed 2.7% to 60.89 after Monday’s reversal. Fortinet is working on a consolidation last July or April at 63.12 handle buy point.
MELI stock jumped 4.5% above its 21-day line to 1,214.96 on Monday after finding support at the 10-week line. Investors can still use 1,250.58 as a valid buy point from the recent flat base.
stock market analysis
The major indexes advanced strongly until about midday, weakening in the afternoon before edging again in the final 40 minutes.
The Nasdaq Composite bounced back above its 50-day and 200-day moving averages and closed not far from intraday highs.
The S&P 500 and Dow Jones climbed but touched resistance near the 200-day lines. The Russell 2000, with a heavy bank concentration, initially rose but closed well above early highs.
Winners outnumber losers 3-to-1 on the NYSE and nearly 2-to-1 on the Nasdaq.
Bank stocks started strongly but began to fall back almost immediately. But they went ahead, often with huge gains.
Tuesday marked day two of market rally attempts on the Nasdaq. There could be a follow up day later this week or next week to confirm the rally attempt.
A rally attempt could show further progress if FRC stock, Western Alliance, PacWest and the broader banking sector continue to rally. But any sense that the bank contagion would spread would almost certainly result in a rapid decline in financials and overall markets.
Several stocks have shown resilience in the past week. Chips continue to do well, including AMAT stock. Megacaps are looking better, including Meta stock, while Tesla stock is rebounding from key support.
Homebuilders are including LEN stock with support closures within the base or handle.
Tim the market with IBD’s ETF market strategy
What do we do now
Stock market is trying to go up, but don’t get excited by strong open or strong close. Even bad markets can have a good day or two. Let the rally effort prove itself.
Bank stocks and the overall market are likely to remain volatile in the short term.
But there is strength in many stocks. If there is a follow-through day of a market rally, many names will buy flashing signals.
So make your watchlist. Look for stocks that are holding near buy points. However, don’t ignore stocks that are showing relative strength but are now overbought.
Read The Big Picture every day to keep up with market direction and the leading stocks and sectors.
Please follow Ed Carson on Twitter @IBD_ECarson For stock market updates and much more.
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