Dow Jones futures rose slightly overnight, while S&P 500 futures fell weakly and Nasdaq futures fell sharply, as Apple (AAPL) and Amazon stocks led major earnings late Thursday. Exxon Mobil (XOM) at Chevron (CVX) is set for early Friday.
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The stock market rally attempt has gained steam as Facebook’s parent Meta Platforms (FB) jumped and many other defeated former tech leaders made up for it. Dow giant Merck (MRK) at Eli Lilly (LLY) rallied on earnings, both flashing buy signals.
Tesla stock dropped on Thursday, but after reducing big losses during the day. Late Thursday, CEO Elon Musk announced he was selling more than three million shares on April 26th.
Apple stock at Amazon.com (AMZN) reported earnings after closing, including Intel (INTC) at Atlassian (TEAM). But other than Apple, all of these stocks are very high.
Along with oil majors Exxon and Chevron, medical giants AbbVie (ABBV) at Bristol Myers Squibb (BMY) report before tomorrow Friday. XOM stock and Dow giant Chevron are close to buy points. ABBV stock is finding support in its 50-day line while Bristol Myers is in its 21-day, both after strong growth.
Tesla (TSLA) and LLY stocks are on the IBD Leaderboard. MRK stock is on SwingTrader. TEAM stock is in IBD Long-Term Leaders. Exxon Mobil, Chevron and BMY stocks are in the IBD Big Cap 20. Merck is the IBD Stock Of The Day.
The video embedded in this article discusses the strong market rebound and examines FB stocks, Merck and Eli Lilly.
Dow Jones Futures Today
Dow Jones futures rose 0.2% versus fair value, even as Apple and Intel hit the blue chips. S&P 500 futures sank 0.3%. Nasdaq 100 futures retreated 0.8%, as Apple and AMZN stocks and other tech earnings losers were dragged down. Those were at their worst Thursday night.
The 10-year Treasury yield dropped 4 basis points to 2.82%.
Note that overnight action on Dow futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
Join IBD experts as they review actionable stocks in the stock market rally on IBD Live
Apple Stock
Apple’s revenue and earnings topped the predictions, amid strong iPhone sales. The Dow Jones tech giant OKed another $ 90 billion for AAPL stock buybacks, and increased its dividend by 5% to 23 cents per share. Apple stock initially rose modestly after hours, but then bounced back lower after warning of a $ 4 billion- $ 8 billion headwind this quarter from China’s continued closure. AAPL stock dropped 2% overnight.
Shares fell 4.5% to 163.64 in Thursday’s regular session, reversing the 200-day line. AAPL stock has 179.71 buy points from a handle that is too large for a consolidation that is only 18% deep. Arguably, there is an early entry from a short trendline that is slightly higher than the 50-day moving average. The relative line of strength for Apple stock is not far from high, a reflection of widespread weakness in the market.
Amazon stock
Amazon reported a big loss in Q1, reflecting its declining value Rivian (RIVN) no. The income is a bit low. Amazon Web Services is slightly ahead of revenue targets. But Amazon led lower in Q2.
AMZN stock dived nearly 9% in extended trading. Shares fell 4.65% on Thursday to 2,891.93, but traded near their lowest level since mid -2020.
Intel Stock
Intel’s revenues are mostly ahead of the views. But the struggling chip giant led low in Q2 EPS and sales. INTC stock sank 4% on extended action. Shares rose 3.6% on Thursday to 46.84.
TEAM stock
Atlassian revenues exceeded the consensus. But the collaboration software maker led low on current quarter EPS. TEAM stock fell 6% overnight. Atlassian stock jumped 6.7% on Thursday to 259.98.
Merck Stock
Merck stock rose 4.9% to 88.58 following better -than -expected earnings. Technically, MRK stock is still below the 89.58 cup-with-handle buy point, according to MarketSmith analysis. But the shares broke the downtrend of the handle and it has been the best closing since early November. The RS line for MRK stock is the highest since January 2021.
Eli Lilly Stock
Eli Lilly stock fell 4.3% to 297.27 on its Q1 earnings. After round-tripping a cup-base breakout earlier this month, LLY stock headed to earnings just above 284 buy points. Shares are still in the buy zone, but also broke a short-term downtrend and moved above their 21-day moving average.
Elon Musk sells Tesla Stock
Musk, in SEC filings Thursday night, revealed he sold more than 3 million Tesla shares on Wednesday. That was the day TSLA stock fell 12.1%. Musk tweeted late Thursday that he had finished selling shares. Musk likely sold the shares to help pay for the acquisition on Twitter.
Musk’s disclosures are too late for trading after hours.
Shares fell 0.45% to 877.51 on Thursday, but had to be dragged to that point by a big market rebound. Intraday, TSLA stock fell as low as 821.70. Technically, Tesla still has 1,152.97 cup-with-handle buying points, but the chart looks broken with shares below major moving averages.
Stock Market Thursday
The stock market rally attempt shook at first but then gained momentum.
The Dow Jones Industrial Average rose 1.85% in stock market trading on Thursday. The S&P 500 index jumped 2.5%. The Nasdaq composite gained 3.1%. The small-cap Russell 2000 rose 1.8% after hitting a fresh 52-week intraday low.
U.S. crude oil prices fell 3.3% to $ 105.36 per barrel. Treasury’s 10-year yield rose 4 basis points to 2.86%.
ETFs
Of the best ETFs, the Innovator IBD 50 ETF (FFTY) climbed 1.1%, while the Innovator IBD Breakout Opportunities ETF (BOUT) grew 1.4%. The iShares Expanded Tech-Software Sector ETF (IGV) jumped 4%. VanEck Vectors Semiconductor ETF (SMH) rose 5.7%.
The SPDR S&P Metals & Mining ETF (XME) rebounded 1.85% and the Global X US Infrastructure Development ETF (PAVE) was 1.9%. The US Global Jets ETF (JETS) climbed 2%. The SPDR S&P Homebuilders ETF (XHB) came out 2.8%. The Energy Select SPDR ETF (XLE) gained 3%, along with XOM stock and CVX stock major component. The Financial Select SPDR ETF (XLF) rose 1.3%. The Health Care Select Sector SPDR Fund (XLV) climbed 1.4%, along with ABBV stock and Bristol Myers big holdings.
Reflecting more speculative story stocks, the ARK Innovation ETF (ARKK) dropped 1.4% and the ARK Genomics ETF (ARKG) 3.5%, both of which hit a 24 -month intraday low. Ang Teladoc Health (TDOC) crash weighed on the same fund. Tesla stock remains No. 1 holding across Ark Invest holdings.
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Market Rally Analysis
The stock market finally got a strong session, with strong price increases overall. But only one day. The best one day percentage gains in stock market history are in bad markets.
The Nasdaq has now begun a new rally attempt in the stock market, while Thursday is the second day for the Dow Jones and S&P 500. If major indices hold their recent lows, investors may be looking for a follow-through day to confirm the new rally as soon as next week. As a practical matter, it seems unlikely that a follow-through day will occur before the two-day Federal Reserve meeting ends next Wednesday.
So far the market remains in a correction.
Many of Thursday’s big winners were defeated techs who rallied on not-included-as-dreaded earnings-such as Facebook, PayPal (PYPL) at Service Today (NOW) – but nowhere near buying opportunities. Merck and LLY stocks are welcome exceptions.
But relief rallies could quickly disappear, with Apple and Amazon leading the futures less overnight.
Energy, steel, fertilizer groups remain resilient, along with defense stocks. Drug makers and health insurers seem strong. Travel names are still interesting.
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What to do now
Thursday’s market action didn’t matter. What matters is what’s next. If major indexes soon charge at new lows, Thursday is just a blip in an ongoing correction or bear market. If the major indices continue to be higher and confirm a new market rally, that is significant.
Investors may buy with little or no exposure to MRK stock or Lilly on Thursday. Another option is to buy a broad market ETF, hoping for at least a short -term bounce. But if you make new purchases before a follow-through day, keep exposure minimal, and be extremely agile. Get a small income quickly and be ready to go out.
Being 100% in cash is still a great strategy.
Your main goal now is to be prepared when the market turns. Build those watchlists. They will need change as the period of gains and recent market losses lifts some names and drags down others.
And stay engaged. You don’t have to stare at your screens while watching the market non -stop, but watch out so you don’t get caught.
Read The Big Picture daily to stay in sync 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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