Dow Jones futures will begin trading on Sunday night, with U.S. markets closed on Friday. Fed Chairman Jerome Powell seemed pleased with Friday's numbers, as the Fed's preferred inflation reports are largely consistent.
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Stock market gains were solid in a holiday-shortened week.Growth stocks, especially AI leaders Nvidia (NVDA), although it generally exceeded support, it declined slightly. The market showed strength in bouncing back and had solid breadth. Small-cap stocks led the way with big gains, with the Dow Jones and S&P 500 hitting record highs. The Nasdaq fell slightly as many tech giants exited the market.
Nvidia needs more time, but microsoft (MSFT), meta platform (meta) and cloud strike (CRWD) Technology leaders are exiting with a bullish stance.
Meanwhile, new AI chip IPO Astera Research Institute (ALAB) has fallen back from its all-time high on Tuesday. If trends in Nvidia stock and AI continue to pause, ALAB stock could lay the groundwork for a near-term IPO.
On the other hand, Chinese EV manufacturers Nioh (NIO), lee auto (LI) and XPeng (XPEV) is expected to report March and first quarter deliveries early Monday, April 1st. BYD (BYDDF) should report a strong March rally on Monday or Tuesday. tesla (TSLA) is likely to release its first quarter deliveries on Tuesday. Expectations for Tesla are low, with Nio and Li Auto in particular lowering their delivery targets in recent days.
Nvidia and META stocks are listed on the IBD Leaderboard. Microsoft stock is on the IBD Long-Term Leaders List. Nvidia, Meta Platforms, and CrowdStrike stocks are included in the IBD 50 list.
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PCE inflation
The PCE price index for February, released by the Commerce Department on Friday, rose 0.3% from January, slightly below the expected 0.4% rise. The PCE increase rate for January has been revised upward to 0.4%. The PCE inflation rate was 2.5% compared to the same month last year, slightly higher than January's 2.4%.
The Fed's top inflation measure, the core PCE price index, rose 0.3% from January, as expected, to an unrounded figure of 0.26%. January statistics have been revised to a 0.5% increase. Core PCE inflation was 2.8% year-on-year, meeting expectations and down from January's upwardly revised 2.9%.
In recent months, inflation has been found to be stagnant and the Federal Reserve has become less eager to cut interest rates.
However, a relatively positive PCE inflation report will likely keep the Fed's June rate cut in place. The probability that the Fed would cut rates in June was about 64% as of Thursday.
Fed Chairman Jerome Powell said Friday that he was “good” that there were no ugly surprises in the PCE data, adding that the report was “more or less what we expected.”
Investors won't get a chance to react until Dow Jones futures open for trading Sunday night, and the real test will come on Monday.
PCE inflation data were provided as part of the income and expenditure report. Personal income rose 0.3%, lower than the expected 0.4%. Consumer spending increased by 0.8%, while viewership increased by 0.5%.
Dow Jones futures today
Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, open at 6pm ET on Sunday.
There will be no trading in the US market on Friday due to the Good Friday holiday. European markets and Hong Kong were also closed on Friday and will remain closed on Easter Monday.
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 rose slightly to strongly over the week, with the exception of some growth spurts.
In weekly stock market trading, the Dow Jones Industrial Average rose 0.8%, setting a record closing price on Thursday. The S&P 500 rose 0.4%, fresh from an intraday high on Thursday. The Nasdaq Composite fell 0.3%, just below its all-time high. For the quarter, the Dow rose 5.6%, the S&P 500 rose 10.2% and the Nasdaq rose 9.1%.
The breadth of the market this week was impressive. The small-cap Russell 2000 rose 2.5% to a two-year high. Invesco S&P 500 Equal Weight ETF (RSP) rose 1.6% to a new all-time high. The First Trust Nasdaq 100 Equal Weight Index ETF (QQEW) rose 0.4% compared to the Nasdaq 100's decline of 0.5%.
The yield on the 10-year Treasury note fell 3 basis points on the week to 4.19%, below its 200-day line.
U.S. crude oil futures rose 3.15% to $83.15 a barrel last week, having soared 16.1% in the first quarter.
ETF
Among growth stock ETFs, the iShares Expanded Technology Software Sector ETF (IGV) fell 0.8% for the week. It owns a huge amount of Microsoft stock, and CrowdStrike also participates in IGV. The VanEck Vector Semiconductor ETF (SMH) fell 1.2%. But these are within weeks and have only given up some of the previous week's big gains.
Reflecting more speculative story stocks, the ARK Innovation ETF (ARKK) rose 1.3% and the ARK Genomics ETF (ARKG) rose 2.1% last week. Tesla stock is a major holding across Ark Invest's ETFs.
Industrial Select Sector SPDR Fund (XLI) rose 0.6%, Financial Select SPDR ETF (XLF) rose 1.7%, and SPDR S&P Home Builders ETF (XHB) rose 1.2%, all hitting all-time highs. .
The SPDR S&P Metals Mining ETF (XME) rose 4% last week. The U.S. Global Jets ETF (JETS) rose 3.3%, both to multi-month highs. Energy Select SPDR ETF (XLE) rose 2.15% to a new 52-week high. Healthcare Select Sector SPDR Fund (XLV) rose to 1.6%, just below its all-time high.
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nvidia stock
Nvidia stock fell 4.2% this week to 903.56, ending its 11-week winning streak at 92%. The stock has not tested its 21-day moving average and is trading within a three-week range. After such strong performance, it makes sense for Nvidia to consolidate for a while. New locations could come in the coming weeks, but NVDA stock could be stalled for an extended period of time, like for the next few months of 2023.
Many other AI stocks may be taking cues from Nvidia, especially around chips. It is constructive to build the foundation and extend the pause period for the moving averages to catch up.
Astera Institute stock
Astera Labs went public at age 36 and soared 72% when it went public on March 20th. AI chip IPO soared to 95.21 on Tuesday before reversing lower. ALAB stock continues to decline. For the week, the stock rose 5.9% to 74.15.
It's usually a good idea to wait for the IPO stock to gain its footing and do some consolidation over a few weeks. The IPO base is very short, at the earliest it can be two weeks, and in some cases unofficially a few days less. However, they often form over several weeks, depending on market conditions. IPO hubs deliver strong returns.
Astera Labs has experienced rapid revenue growth from a relatively low base. Although the company was in the red in 2023, it is expected to continue to see high profit growth in 2025, and is expected to turn profitable in 2024.
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Stocks near the purchase point
Microsoft stock has been declining for five consecutive sessions, but losses are small and trading volume is very low. The stock price is hovering just below the buy point of 420.82, but remains above the 21-day line. If there is a rebound, it will be manageable.
Meta stock fell 4.7% last week to 485.58 on poor volume. The stock price was slightly below the 21st line. The stock is retreating towards its rapidly rising 10-week line, which could put it roughly on par with Monday's meta. This will be the first real 10-week line test of 2024. A rebound from that level would be a buying opportunity. Meta stocks could also find new ground in the coming weeks.
CrowdStrike stock has fallen 2.1% over the past week to 320.59, with support near the 21-day and 10-week lines. The cybersecurity leader's consolidation has been chaotic, but investors could set a buy line near 338.45 or use Wednesday's high of 333.84 as an early entry.
In fact, many software stocks are hovering around support levels or potential entries.These include CrowdStrike peers cyberark software (CYBR) as well as cloudflare (Net), Monday.com (MNDY), ServiceNow (now) and hubspot (Hub).
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tesla stock
Tesla stock hit 10-week resistance last week, but rose 2.9% last week to 175.70. Bulls are betting that full self-driving will represent a significant improvement, with CEO Elon Musk requiring FSD test drives before new purchases and after service visits. But in the short term, analysts continue to lower Tesla's revenue and delivery forecasts. The main reason for this is generally weak demand for EVs. Competition continues to intensify in China, with smartphone maker Xiaomi making a big entry into the EV market on Thursday.
Tesla will announce first-quarter production and deliveries on Tuesday, April 2nd, and is scheduled to announce first-quarter earnings later that month.
what to do now
The stock market rally appears to be expanding and turning in a constructive direction. While this article has focused on tech stocks in general, investors can find viable or promising stocks in the housing, financials, healthcare, travel, and consumer sectors.
Eli Lilly (LLY), Medpace (MEDP), Uber Technologies (Uber), elf beauty (fairy), next tracker (NXT), XP (XP), royal caribbean (RCL), east west bancorp (EWBC), axon enterprise (Axon), On hold (Onon), M/I Homes (MHO) and Warren Buffett's berkshire hathaway (BRKB) are just a few.
Technology growth leaders such as Nvidia, Microsoft, and Meta are likely to consolidate over time.
So cast your wide net and add promising names to your watchlist. Use your long weekend to run screens and research specific targets.
Don't forget about defense. Last week, several leading stocks issued sell signals to recent buyers. Many stocks are rising and falling in seemingly bullish positions, but it wouldn't take much selling for things to start to deteriorate significantly.
Read The Big Picture every day to stay on top of market direction and key stocks and sectors.
Follow Ed Carson's thread @edcarson1971, X/Twitter. @IBD_ECarson For the latest stock market updates and more, visit Bluesky at @edcarson.bsky.social.
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