Dow Jones Futures: Stock Market Rally Has Yet To Do This

Dow Jones futures edged higher early Wednesday along with S&P 500 futures and Nasdaq futures. The stock market rally revived on Tuesday as the S&P 500 returned to the 4,000 mark.




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deer (FROM) reported better than expected earnings early Wednesday. DE shares jumped in premarket trading, signaling a move out of the buy zone.

Deere’s earnings and guidance are important to a variety of agricultural stocks, including CF industries (CF) and Archer Daniels Midland (ADM), as well as mechanical engineers such as Caterpillar (CAT).

Energy stocks continue to perform well. solar guide Enphase Energy (ENPH), coal producer Peabody energy (Btu), refiner CVR Energy (CVI), natural gas producer EQT Corp. (EQT) and LNG inventory Excel Energy (EE) are all nearby buy points.

EE stock broke out on Wednesday and Enphase returned to a buy zone. BTU shares, CVR Energy and EQT are actionable.

ENPH camp is on IBD Leaderboard. EQT stock is on swing trader. Deere stock is on the IBD 50. Peabody Energy is on Tuesdays IBD Stock of the Day.

Riots at the Apple iPhone factory

Riots broke out overnight at Apple’s largest iPhone factory in China as hundreds of workers clashed with security forces. Over 100,000 workers have been forced to live at Foxconn’s Zhengzhou campus for weeks due to Covid concerns, many of whom were reportedly unpaid during that time.

Protests are also growing elsewhere amid renewed lockdowns and tight restrictions across much of China as Covid cases rise.

Apple recently warned that Apple iPhone 14 Pro models would be in short supply due to the Foxconn factory in Zhengzhou.

Apple shares fell a fraction early Wednesday. AAPL was up 1.5% on Tuesday to 150.18 and found support near its 50-day moving average, but still below its 200-day moving average.

Dow Jones futures today

Dow Jones futures are up less than 0.1% from fair value. S&P 500 futures were up 0.1%. Nasdaq 100 futures were up 0.1%.

The 10-year government bond yield rose 1 basis point to 3.77%.

Crude oil futures fell 2%. US natural gas prices rose 7%. On Tuesday, Europe released details of a natural price cap that starts from January 1 for a year and is more than double the current level.

The Reserve Bank of New Zealand hiked interest rates by a record 75 basis points, as expected.

The Fed’s November minutes will be released on Wednesday.

Think about the night action in Dow futures and elsewhere not necessarily translated into actual trading in the next regular time stock market Meeting.


Join IBD experts as they analyze actionable stocks in the stock market rally on IBD Live


stock market rally

The stock market rally started mixed on Tuesday but rallied for broad-based gains and closed near session highs.

The Dow Jones Industrial Average rose 1.2% on Tuesday stock exchange trading. The S&P 500 Index and the Nasdaq Composite both rose nearly 1.4%. The small-cap Russell 2000 was up 1.1%.

The 10-year government bond yield fell 7 basis points to 3.76%. But the two-year Treasury yield, which is more closely linked to Fed policy, was roughly flat at 4.53%.

The dollar, after recovering in the previous three sessions, fell back on Wednesday. The greenback has fallen significantly since the end of September, especially from the beginning of November.

US crude prices rose 1.1% to $80.95 a barrel, continuing the recovery from Monday’s short-lived plunge. Gasoline futures rose 4.3%, good news for refiners. Natural gas futures edged higher after falling more than 2% on the day.

ETFs

among the The best ETFsthe innovator IBD 50 ETF (FFTY) rose 3.4%, helped by a range of energy and metals stocks. The iShares Expanded Tech Software Sector ETF (IGV) rose by 1.8%. The VanEck Vectors Semiconductor ETF (SMH) rose by 2.9%.

SPDR S&P Metals & Mining ETF (XME) gained 3.2% and the Global X US Infrastructure Development ETF (PAVE) pinned to 1.3%. SPDR S&P Homebuilders ETF (XHB) rebounded 1.9%. The Energy Select SPDR ETF (XL) rose by 3.1%. The SPDR Fund for Selected Healthcare Sectors (XLV) rose 0.9% to a seven-month high.

Stocks with more speculative stories reflect ARK Innovation (ARKK) returned 0.3% and ARK Genomics (ARKG) fell by 0.4%.


The five best Chinese stocks to watch right now


Energy stocks near buy points

Enphase shares rose 4% to 320.44 to close above 316.97 Cup with handle Buy point for the first time. However, the last three times ENPH stock has hit these areas, it has reversed to the downside. Enphase stocks tend to have large daily swings. So, investors could check if ENPH stock is falling back to its rapidly rising 21-day moving average.

A few other LNG stocks are showing strength Flex LNG (FLNG) break out and Chen energy (LNG) reclaim its 50-day line.

BTU stock rose 6.7% to 29.62, just below a handle buy point of 30.15 in a seven-month consolidation. Tuesday’s move broke the handle’s trendline and provided an early entry. However, BTU stock is 9.3% above its 21-day moving average and 17% above its 50-day moving average. The grip formed after strong gains by Peabody Energy.

CVR Energy shares are up 4.85% to 40.85, back above an old buy point of 39.81 that could still be considered valid. The CVI share also has a three weeks short Pattern with a 42.31 entry. A move above 41.31 could offer early entry into this tight pattern.

EQT shares rose almost 6% to 43.79, breaking out again above the 50-day moving average after recovering from the 200-day moving average on Monday. Stocks break a downward sloping trend line. The official purchase point is 52.07.

EE stock rose 9.6% to 30, breaching a buy point of 28.49 cups with handle in above-average volume MarketSmith Analysis. The move to a record close cleared many trades that had taken place since Excelerate Energy’s IPO in April. EE shares had shown early entries on Friday and Monday, despite trading below normal on those days. Excelerate is now slightly extended from the buy zone and well extended from the 21-day moving average.

Analysis of the market rally

The stock market rally continues to show constructive action and is trading in a tight range after a modest pullback and support last week. On Tuesday, the major indices rebounded from Monday’s losses.

The S&P 500 rebounded from its 10-day moving straight to the 4,000 mark while approaching its 200-day moving average. While not above the Nov. 15 intraday high, it was the index’s best close in more than two months.

The 50-day line is only The S&P 500 starts to rise.

The Russell 2000 is approaching its 200th anniversary. The S&P MidCap 400, which held its 200-day moving average last week, continued to make gains.

The leading Dow Jones surged above 34,000 for the first time in three months, just below the Aug. 16 peak. Laggard Nasdaq found support at its 21-day moving average, just above its 50-day moving average, but failed to recoup all of Monday’s losses.

All of these indices are working on handles, with the Dow creeping above them. Most stocks follow the movement of the major indices, so many stock grips form near buy points. A slightly longer pause, perhaps until major economic reports later next week, would see the moving averages start catching up.


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What now

Until the S&P 500 moves decisively above its 200-day moving average, investors might not want to gain much exposure right now. With the Thanksgiving holiday dampening trade and Fed-crucial economic data next week, the market rally could range in the near-term.

This could help stocks across a variety of sectors build grips and allow moving averages to gain ground. Investors should build their watch lists. It’s definitely time to look beyond traditional tech growth stocks, which are mostly lagging at the moment.

With many top performers deviating from moving averages like Excelerate Energy or BTU stocks, it’s even more important to look for early entries and act quickly.

Read The big picture every day 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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