Dow Jones futures fell slightly overnight, along with S&P 500 futures and Nasdaq futures. Investors will turn to the November jobs report on Friday morning.
A Tesla Semi truck delivery incident occurred Thursday night Tesla ( TSLA ) archrival BYD is set to release fast-growing EV sales numbers.
The stock market rallied on Thursday, with indexes mixed but fueling big gains on comments from Fed Chair Jerome Powell on Wednesday. Thursday’s PCE inflation report, the Fed’s favorite price gauge, showed smaller-than-expected monthly gains as headline and core inflation cooled slightly again.
Ulta Beauty ( ULTA ) headline earnings reports Thursday night. ULTA shares were little changed overnight after strong earnings and raised guidance. The beauty retailer’s shares have already hit record highs from buy points. Veeva Systems ( VEEV ) beat financial Q3 views, but Q4 guidance was slightly below the consensus midpoint. VEEV shares fell modestly in extended trade. Shares closed above the 200-day line, around the early entry.
Meanwhile, the Dow giant Caterpillar (CAT) continues to look strong, with CAT shares just below a buy point. Cyber security leader Palo Alto Networks (PANW) and Marriott International (MAR) also flashes with buy signals.
Boeing shares are available on SwingTrader. Caterpillar was the top IBD stock on Thursday.
Dow Jones Futures today
Dow Jones futures were down 0.2% at fair value. S&P 500 futures fell 0.3%. Nasdaq 100 futures fell 0.4%.
Dow futures, Treasury yields and more will change in the November jobs report, due at 8:30 a.m. ET.
Remember that an overnight move in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular trading session.
Economists expect the November jobs report to show nonfarm payrolls increased by 261,000 to 200,000 in October. Note the household survey showing that jobs fell by 328,000 in October. The unemployment rate based on the household survey is expected to remain stable at 3.7%, while the labor force participation rate is expected to reach 62.3%.
Other labor data this week pointed to a generally gradual slowdown. Initial jobless claims unexpectedly fell, but ongoing claims rose again. ADP reported a sharp slowdown in private sector hiring last month, while the October JOLTS survey showed a slight decline in jobs.
Tesla Semi Delivery Event
The Tesla Semi truck delivery event began shortly after 5 PT.
Tesla CEO Elon Musk will deliver some Tesla Semi EVs PepsiCo (PEP) on Thursday night. Speaking of delays, the Tesla Semi was first introduced six years ago and was supposed to go into production in 2020.
Musk says the Tesla Semi, which will use the same Plaid drivetrain as the high-end Model S, can travel 500 miles on a single charge. Investors will look for precise specifications on price, range and freight. This will be important as the Tesla Semi takes on the big rig EVs already on the market from Volvo. Nicola (DQLA), BYD (BYDDF) and more.
The other big question is what will happen to Tesla Semi production in the coming months. Musk did not clarify on this front.
Meanwhile, Tesla is offering $3,750 off the Model 3 and Model Y in the US this month. The idea is to encourage people to buy delivery now. On Jan. 1, a new $7,500 U.S. tax credit goes into effect, subject to certain price and income limits, prompting many potential buyers to wait. The tax breaks should apply to most Model 3 sedans and Model Y crossovers, although the government has yet to clarify.
Tesla shares closed at 194.70 on Thursday. On Wednesday, TSLA shares rose 7.7%, retracing their 21-day line, amid a big market rally and as Chinese EV stocks rose.
Tesla Vs. BYD: Which EV giant is better to buy?
Chinese EV giant BYD is expected to announce its November deliveries on Friday or Saturday, another record. BYD is expected to become China’s No. 1 car brand Volkswagen (VWAGY). VW Group is likely to remain No. 1, including Audi.
BYD shares fell 2.2% to 25.07, but are still above their 50-day line. BYDDF gained 9.9% on Wednesday, along with other Chinese EV stocks.
Join IBD’s experts as they analyze the stocks that made the most of the stock rally on IBD Live
Stock market rally
The stock rally saw a 30-minute dip on Thursday morning, but has gradually turned mixed after Wednesday’s big gains.
The Dow Jones Industrial Average fell 0.6% in Thursday’s trading. Salesforce.com (CRM) a big negative. The S&P 500 index fell 0.1%. The Nasdaq composite rose 0.1%. The small-cap Russell 2000 retreated 0.2%.
The price of crude oil in the United States increased by 0.8% to 81.22 dollars per barrel.
The 10-year Treasury yield fell 17 basis points to 3.53%, the lowest since late September. Following Fed Chair Powell’s comments and the PCE inflation report, markets are close to closing in on a 50 basis point Fed rate hike on Dec. 14, ending a four-meeting streak of 75 basis point moves. In addition, there is a 50-50 chance that the Fed will only raise interest rates by a quarter point in February.
The dollar, moving with income, fell to its lowest level in nearly three months.
Stocks Close to Buy Points
CAT shares fell 0.3% to 235.69. According to MarketSmith analysis, shares are suspended around the 238 buy point, which is still valid from a cup base through April. Investors may see 239.95 as another buy point, either as a high handle for the seven-month cup base, or as a traditional handle for a larger consolidation starting in June 2021.
Shares of cybersecurity firm Palo Alto Networks rose 5% to 178.40, bouncing above their 200-day line, retaking that key level for the first time since mid-September. It halted a major profit selloff in its peers after it bounced back from its 50-day line on Wednesday. CrowdStrike (CRWD). Investors may see PANW stock as having a large, double-bottom base with a buy point of 193.01. But stocks may already be on the move by clearing the 200-day line and the downtrend line from the April peak.
MAR shares fell 0.1% to 165.19, staying above the 164.99 hold buy point from the bottoming base since Aug. 16. Marriott shares rose 2.5% on heavy volume on Wednesday, bouncing back from their 200-day line.
Among the top ETFs, the iShares Expanded Tech-Software Sector ETF ( IGV ) rose 1.1%, even as large holding CRM shares sold off. VanEck Vectors Semiconductor ETF ( SMH ) fell 0.3%.
The SPDR S&P Metals & Mining ETF (XME) rose 0.8%, while the Global X US Infrastructure Development ETF (PAVE) gained 0.1%. US Global Jets ETF (JETS) fell 0.4%. The SPDR S&P Homebuilders ETF ( XHB ) rose 1.25%. The Energy Select SPDR ETF ( XLE ) was down 0.3%, while the Financial Select SPDR ETF ( XLF ) was down 0.6%. The Healthcare Select Sector SPDR Fund ( XLV ) advanced 0.3%
Reflecting more speculative story stocks, the ARK Innovation ETF ( ARKK ) rose 1.1%, while the ARK Genomics ETF ( ARKG ) rose 0.6%. Tesla stock is a major weighting in Ark Invest’s ETFs. Cathie Wood’s Ark also has a small position in BYD stock.
Five Best China Stocks to Watch Now
Market Rally Analysis
The stock market rally performed constructively on Thursday after making big gains on Wednesday.
The S&P 500 index rose above its 200-day moving average without retreating on the day after finally retaking that key level on Wednesday. The Russell 2000 also crossed the 200-day line. There is still work to be done for the Nasdaq to return to 200 days.
The Dow Jones gave up only a fraction of its gains on Wednesday, largely thanks to Salesforce. Several Dow Jones stocks are showing strength, including shares of Caterpillar, Boeing and UNH. It reflects broader strength in industry, finance, health services and more.
The October PCE inflation report was slightly better than expected. After a strong market rally against Fed Chair Jerome Powell on Wednesday – which, frankly, didn’t sound particularly dovish – it was only constructive to hold onto those gains on Thursday.
Friday’s jobs report is another hurdle. If employment data points to some slack in the labor market, that could provide a further tailwind for stocks. But a hot job market could lead to a big selloff.
Treasury yields and the dollar have fallen sharply over the past two days and over the past few weeks, providing a major tailwind for stocks. A rebound in incomes and the dollar will not be a surprise.
Remember that a market rally is a series of big one-day gains, followed by a sideways or sliding move. This has made it difficult for investors to make headway, even as the indices have rallied over the past few weeks.
Market Timing with IBD’s ETF Market Strategy
What to do now
With Wednesday’s big move, there were reasons to buy or hold. On Thursday, investors could have added some exposure, but the jobs report is a big question mark.
Friday’s market rally in the November jobs report could lead to a number of buying opportunities. But don’t be fooled by promising stocks ahead of big news. Instead, work on your watchlists so you’re ready to take action. But be prepared to reduce exposure if the market or your holdings head sharply south.
Read The Big Picture daily to stay in sync with market direction and leading stocks and sectors.
Follow Ed Carson on Twitter @IBD_ECarson for stock updates and more.
YOU MAY ALSO LIKE:
Why this IBD tool makes finding the best stocks easy
The best growth stocks to buy and track
IBD Digital: Discover IBD’s Premium Stock Lists, Tools and Analysis today