Dow Jones futures edged lower after hours, along with S&P 500 futures and Nasdaq futures. Taiwan Semiconductor (TSM) reports early Thursday with retail sales headlining big economic reports before the open.
Uber Technologies (UBER) has considered a possible bid for travel website Expedia (EXPE), the Financial Times reported Wednesday night. Uber stock fell while Expedia jumped.
The stock market rally saw modest-to-solid gains on the major indexes Wednesday. The Dow Jones hit a record close while the small-cap Russell 2000 jumped to a two-year closing high.
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Small Caps Lead Another Bullish Up Session: CBOE, Waystar, PACS In Focus
Nuclear plays skyrocketed as Amazon.com (AMZN) became the latest tech titan to embrace nuclear power. But the stocks are extended.
Nvidia (NVDA) led AI chip plays higher, closing in range of a buy point. Taiwan Semi is between buy points. Broadcom stock is just below a handle entry.
Taiwan Semiconductor earnings, guidance and capital spending outlook will be key for TSM stock, Nvidia and the broad chip sector. Taiwan Semiconductor makes chips for Nvidia, Broadcom (AVGO), Apple (AAPL) and many others. It’s also one of the biggest buyers of chip equipment.
The stakes are higher in the wake of Dutch chip-equipment giant ASML (ASML), which announced a huge bookings shortfall and weak guidance on Tuesday. ASML stock dived that day and kept tumbling Wednesday, dragging down other chip-gear peers.
Nvidia stock is on IBD Leaderboard, SwingTrader and the IBD 50. Broadcom stock is on the IBD Big Cap 20.
Dow Jones Futures Today
Dow Jones futures lost a fraction vs. fair value. S&P 500 futures and Nasdaq 100 futures fell 0.1%.
At 8:30 a.m. ET, investors will get September retail sales, the October Philly Fed manufacturing index and weekly jobless claims. September industrial production (9:15 a.m.) and the October Housing Market Index (10 a.m.) will follow.
Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
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Stock Market Rally
The stock market rally had a healthy session, with small caps and certain sectors significantly outpacing the major indexes.
The Dow Jones Industrial Average climbed 0.8% in Wednesday’s stock market trading, with its best-ever close. The S&P 500 index rose 0.5%, near all-time highs. The Nasdaq composite advanced 0.3%. The small-cap Russell 2000 jumped 1.6%, just below 34-month intraday high set July 31 and the highest close since late 2021.
U.S. crude oil prices dipped 0.3% to $70.39 a barrel.
The 10-year Treasury yield fell 2 basis points to 4.015%, extending a recent pullback.
Bitcoin rose 1.2% to $67,742.75 as of 4 p.m. ET, up 8% so far this week.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF (FFTY) rose 0.8%. The iShares Expanded Tech-Software Sector ETF (IGV) fell 0.45%. The VanEck Vectors Semiconductor ETF (SMH) edged up 0.1%. Nvidia is the No. 1 holding with Taiwan Semiconductor stock and Broadcom key components. But ASML stock and chip-gear makers also have a notable weight.
ARK Innovation ETF (ARKK) advanced 0.85% and ARK Genomics ETF (ARKG) bounced 1%.
SPDR S&P Metals & Mining ETF (XME) rallied 2.1%. U.S. Global Jets ETF (JETS) ascended 4.1%. SPDR S&P Homebuilders ETF (XHB) stepped up 1.2%. The Energy Select SPDR ETF (XLE) gained 0.5% and the Health Care Select Sector SPDR Fund (XLV) advanced 0.3%.
The Industrial Select Sector SPDR Fund (XLI) climbed 0.8%. The Financial Select SPDR ETF (XLF) popped 1.2%.
Time The Market With IBD’s ETF Market Strategy
Nvidia Stock
Nvidia stock rose 3.1% to 135.72, rebounding from the 10-day moving average, though it was an inside session. Shares fell 4.7% on Tuesday, but closed just above a 131.26 buy point. It’s possible that Nvidia stock will forge a handle just below record highs, Currently, the all-time high of 140.76 is the ultimate buy point, but it’s already actionable from the 131.26 entry.
Taiwan Semi earnings could trigger big moves in Nvidia.
On Wednesday, billionaire investor Stanley Druckenmiller told CNBC that selling Nvidia stock was a mistake. The head of Duquesne Family Office sold 88% of its NVDA stake in Q2 and has fully exited, saying he thought the valuation was too high. He expects to “get involved” again.
“But right now, I’m licking my wounds from a bad sell there,” Druckenmiller said.
What To Do Now
The stock market rally is doing well, perhaps even better than the major indexes would indicate. A lot of stocks have been flashing buy signals and powering higher.
Nuclear stocks have been huge winners in recent days and weeks, but most of them are extended, often massively. When you see stocks jump 10%, 20%, even 50% in just a few days, it’s hard to not have FOMO. But don’t chase after extended stocks. The risks of a significant pullback are too high.
Pay attention to nuclear plays, looking for safer entries. But for now, most of these names are out of the buy zone containment field. Treat nuclear stocks as radioactive, for now, if you don’t already have a position.
There were some stocks that flashed buy signals Wednesday and are still in range, including United Therapeutics (UTHR), KB Home (KBH). Nvidia stock is still actionable.
This is why IBD bangs the drums on building up your watchlists and staying engaged. If you want catch the big winners, you have to have those names on your radar before they take off, then be ready to act when the time is right. Running your screens will also keep you in tune with leading stocks from across different sectors, helping you get a diverse mix of leaders.
Remember, if you’re already heavily invested, you don’t have to make a lot of moves. A lot of money is in the siting, even for active investors.
Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.
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