Dow Jones futures will begin trading on Sunday night, along with S&P 500 futures and Nasdaq futures. A Federal Reserve meeting looms as investors look for a move toward lower interest rates.
X
Stock market gains were modest for the week, with major indexes reversing their gains since Wednesday. The S&P 500 hit a 2023 high on Friday, and the Nasdaq is right on top of it. Many stocks are attempting to exit, including some chip plays. A market rally appears poised, but bullish sentiment is already building.
Advanced Micro Devices (AMD) Last week, the new AI chips skyrocketed past the purchase point, making things difficult. Nvidia (NVDA) Huge and rapidly growing artificial intelligence accelerator market. Meanwhile, NVIDIA stock rallied toward a buy point, tripping up some early entries. arm holdings (arm) broke out of the IPO base on Friday. broadcom (AVGO) The buy point was pushed back following Friday’s results. taiwan semiconductor (TSM), makes chips for Nvidia, AMD, and Broadcom apple (AAPL) and a number of other companies (many from Arm chip designs) announced early entries on Friday.
meanwhile, tesla (TSLA) continues to trade solidly as it slowly moves towards an aggressive entry of its own.
Finally, the FDA has approved the first-ever gene editing therapy. Crispr Therapeutics (CRSP) and vertex pharmaceuticals (VRTX). But CRSP stock, which had soared over the past few weeks starting Friday morning, fell sharply following the announcement in a classic “selling the news” event.
The last Fed meeting of 2023 will be held Tuesday through Wednesday. No action is expected, but Fed Chairman Jerome Powell could signal that he and his policy makers are leaning toward cutting rates in 2024.
Signa (CI) has reportedly given up on merging with a rival. humana (ham). Instead, the health insurer increased its stock repurchase program by $10 billion on Sunday after CI stock fell on deal talk.
The video embedded in the article highlighted weekly market trends and analyzed Arm Holdings. microsoft (MSFT) and CRSP strain.
Added ARM stock IBD Leaderboard Joined NVIDIA on Friday. Nvidia stock is listed on his SwingTrader, IBD50. AMD was IBD’s “Stock of the Day” on Thursday.
Dow Jones futures today
Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, open at 6pm ET on Sunday.
Please note that overnight trades such as Dow futures do not necessarily translate into actual trades in the next regular stock market.
IBD experts analyze leading stocks and markets on IBD Live.
stock market rise
The stock market rebound started this week lower, but rebounded on Thursday, with major indexes ending the day with modest gains.
The Dow Jones Industrial Average rose 2 points in last week’s stock market trading. The S&P 500 index rose 0.2%. The Nasdaq Composite rose 0.7%, reversing gains after falling below a short-term low on Monday.
On Friday, the S&P 500 index hit a new 2023 high set in July, and the Nasdaq index hit its highest closing price this year. A definitive clearing of the recent range would signal that the market rally is starting to move even higher.
The small-cap Russell 2000 rose 1% and returned as the market widened.
While some heavyweight stocks soared last week, many others took the wheel or fell to major levels. Chips and software continued to perform well, while industrials, financials, and travel stocks also showed some strength.
The yield on the 10-year U.S. Treasury rose 2 basis points to 4.24%. The 10-year Treasury yield rose more than 11 basis points (bp) on Friday following the November jobs report. The yield on the two-year U.S. Treasury rose 16 basis points to 4.725%, about where it was on Friday.
Recently, the inverse correlation between US Treasury yields and stock prices has weakened. Investors are no longer worried about inflation or the Fed raising interest rates, and they don’t want the economy to slow too much. November employment statistics
U.S. crude oil futures fell 3.8% last week to $71.23 a barrel, despite rebounding 2.7% from multi-month lows on Friday.
There is one caveat. The CBOE Volatility Index (VIX) fell to its lowest level since January 2020 on Friday. When market fear levels are abnormally low, it is a sign of over-bullishness or complacency. This increases the risk of a market pullback. But it doesn’t have to happen right away, and it doesn’t have to be deep and long-lasting.
ETF
Among growth ETFs, iShares Expanded Technology Software Sector ETF (IGV) fell 0.9%, after five weeks of strong gains. VanEck Vectors Semiconductor ETF (SMH) rose 0.8%, but reversed sharply in the second half of the week. Nvidia, AMD, Broadcom, and TSM stock are all among his top five SMH holdings.
ARK Innovation ETF (Arkku) ARK Genomics ETF (arcg) fell 1.4%. Tesla stock is a major holding across Ark Invest’s ETFs. CRSP stock is also a top Cathie Wood stock.
SPDR S&P Metals & Mining ETF (XME) fell 4% last week as trends in coal, steel, copper and gold weakened. Global X US Infrastructure Development ETF (pave) rose 0.2%. US Global Jets ETF (jets) soared 6.5%. SPDR S&P Home Builders ETF (XHB) rose 3.5% to a record high. Energy Select SPDR ETF (XLE) fell 3.3%, while the Healthcare Select Sector SPDR Fund (XLV) rose 0.2%, with VRTX stock as a component. Industrial Select Sector SPDR Fund (XLI) rose 0.2%.
Financial Select SPDR ETF (XLF) fell 0.1%, and the SPDR S&P Regional Bank ETF (KRE) rose 3.2%.
Top 5 Chinese stocks to watch right now
Chip stocks near buy points
AMD stock rose 6.2% last week to 128.92. The stock cleared two buy points for Cup With Handle on Thursday at 122.11 on the daily chart and 125.37 on the weekly chart. AMD stock is up slightly from its entry at 122.11, but is still in a buy zone from 125.37. On Wednesday, AMD announced a new lineup of AI chips to compete with Nvidia. Microsoft, meta platform (meta) and oracle (ORCL) are early buyers as they seek to reduce their dependence on Nvidia GPUs.
Nvidia stock fell to its 50-day line at the beginning of the week, but rebounded on Thursday and Friday. The stock rose 1.6% to 475.01, above its 21-day moving average. NVDA stock is still within reach of regaining its active double-dip buy point at 476.09, but investors could take action Friday afternoon.
On Friday, Arm shares rose 7.7% to $67.23, outperforming the high-volume cup-with-handle IPO base of $64.92. The relative strength line hit an all-time high on the breakout. The British wireless chip design giant went public at 51 shares a share, reaching an intraday price of 69 shares on September 15, its second day of trading. Arm’s design is used by many chip manufacturers.
AVGO stock rose 1.5% on the week to 944.30, rebounding from Thursday’s 50-day/10-week line. On Friday, Broadcom stock rose above the still valid flat-based buy point of 923.67 in very heavy trading. The stock price also decisively broke through the 21-day line, breaking the short downward trend.
Late Thursday, Broadcom’s profit slightly beat expectations for the fourth quarter. The chip and software giant has raised its dividend by 14%, giving a positive outlook for fiscal 2024.
TSM stock rose 1.8% to 100.35 in a solid reversal last week. The buy point for the major chip foundry’s cup with handle is 100.70. The stock just broke out of the handle’s downtrend on Friday, suggesting an early entry. Taiwan Semiconductor Co. reported on Friday that sales in November decreased compared to the same month last year.
Timing the Market with IBD’s ETF Market Strategy
tesla stock
Tesla stock rose 2.1% to 243.84, marking its fourth consecutive week of gains. The EV giant has been trading solidly for the past few weeks, finding support at its 50-day line. According to MarketSmith analysis, the double bottom buy point for TSLA stock is 278.98. Investors could use a trendline break just below 250 or the November 29 high of 252.75 as an early entry.
At first glance, all active investors seem to be paying attention to Tesla’s stock price level. Too obvious?
what to do now
Stock market gains have been following a sideways pattern, but are very close to the 2023 high. Some of the major stocks are already pushing higher, while others are getting closer.
Hopefully, most investors have already invested heavily. You can also add exposure incrementally, perhaps by taking profits or cutting back on laggards to partially offset new purchases.
If the S&P 500 and Nasdaq break out of their 2023 highs, it could signal a new phase in the market bull run and strengthen the case for becoming more aggressive. Many modern setups can be triggered by this scenario.
Get ready. Work on your watchlist. While this article focused on Tesla and the five largest semiconductor stocks, leaders are emerging from a variety of sectors. So let’s cast a wide net.
Read The Big Picture every day to stay on top of market direction and key stocks and sectors.
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