Dow Jones futures will open Monday evening, along with S&P 500 futures and Nasdaq futures. Tesla ( TSLA ) and Chinese EV makers such as Nio, Li Auto and BYD will report year-end and 2022 deliveries over the New Year holiday weekend.
Investors will be looking for a brighter stock market in 2023, especially for growth, after the “stay away” year. The Dow, S&P 500 and Nasdaq experienced their biggest annual declines in 14 years. The stock rally attempt continues, but it has a long way to go to prove itself.
The Dow Jones fell below its 50-day moving average on Friday. The S&P 500 and especially the Nasdaq have some distance to go to their 50-day lines, with several other major resistance areas along the way.
Celsius Holdings (CELH), Deere (DE), BioMarin Pharmaceutical (BMRN), Exxon Mobil (XOM) and Medpace (MEDP) are five stocks near buy points. This is a diverse list of possible areas of market leadership in the new year.
DE stock and Medpace are on the IBD Leaderboard. Celsius, MEDP shares are in the IBD 50. Deere and BMRN stocks are in the IBD Big Cap 20.
Deere was the IBD Stock of the Day on Friday.
However, whether these stocks work or not depends on the upward trend of the market. Currently, it is not. Investors should be very cautious.
In the video embedded in the article, recent market movements are discussed in depth and what investors should do in the stock market until 2023. The video also analyzed CELH stock, Deere and BioMarin.
China Home Delivery
Nio (NIO), Lee Auto (LI) and XPeng (XPEV) is set to report December, fourth-quarter and full-year EV deliveries on Sunday, January 1. Lee Auto said on Friday that deliveries of hybrid SUVs will exceed 20,000 in December, breaking November’s record of 15,034. Nio recently lowered its Q4 delivery guidance, citing Covid-related issues. Management had forecast December deliveries of 14,263-15,263 EVs, which would slightly exceed November’s record of 14,178. Xpeng should see shipments pick up after several month-to-month declines, but its model lineup is struggling.
BYD is likely to report December sales on December 3, before the US market opens on Tuesday. The EV and battery giant recently reported that Covid infections among workers have reduced production by at least 2,000 vehicles per day. BYD recently said that full-year deliveries of all-electric BEVs and plug-in hybrids should be around 1.88 million. That would imply December shipments of around 247,000-250,000, which would still be a record.
Nio shares have had a rough 2022, as have Li Auto, Xpeng and BYD, other EV makers and growth stocks in general. They all bottomed out in October or early November, but have pulled back in recent weeks.
Tesla Vs. BYD: Which EV giant is better to buy?
Tesla EV Deliveries
Tesla is expected to release fourth-quarter EV production and delivery figures on January 2. Analysts expect 4Q Tesla shipments to be 418,000, despite declining consensus in recent days amid further weakening China. Tesla offered big end-of-year incentives to boost sales, especially in China and the US. It didn’t make a big push in China, but it cleared inventory in the US
In 2023, Tesla will benefit from up to $7,500 in new U.S. tax credits, although year-end rebates of $7,500 for the Model 3 or Model Y — with the Model S and X added on Dec. 30 — could offset some of that demand. . . The $55,000 price cap on most Model Y vehicles could limit Tesla’s EV loan growth.
Meanwhile, China is ending EV subsidies. Coupled with a massive Covid wave, it could further reduce sales for EV makers out there, including Tesla. Tesla may need significant new price cuts in China, where competition from BYD, Nio, Li Auto, Xpeng and others continues to heat up.
Several countries in Europe are cutting or suspending EV subsidies, providing another headwind for Tesla as backlogs there ease.
Tesla stock has lost 65% in 2022, its worst annual decline ever. Shares fell 37% in December to their lowest level since September 2022. The electrical giant ended the week roughly flat, rebounding from midweek bear market lows. TSLA stock volume has been very high over the past few weeks.
Dow Jones Futures today
Dow Jones futures open at 6:00 PM ET on Monday, along with S&P 500 futures and Nasdaq 100 futures.
US stock and bond markets will be closed on Monday, January 2 for the New Year’s holiday.
On Tuesday, investors will receive the December ISM manufacturing index. Friday’s December jobs report looms large as the Federal Reserve looks for signs of a weakening job market.
Remember that an overnight move in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular trading session.
Join IBD’s experts as they analyze the stocks that made the most of the stock rally on IBD Live
Exchange ends 2022
The stock market went into correction on Wednesday, but a new rally attempt began on Thursday. Major indexes closed lower on Friday, closing a slightly negative week.
The Dow Jones Industrial Average fell 0.2% in stock trading last week. The S&P 500 index fell 0.1%. The Nasdaq composite fell 0.3%. The small-cap Russell 2000 lost some.
For the entire year, the Dow Jones lost 8.8%, the S&P 500 lost 19.4% and the Nasdaq lost 33.1%. It was their worst annual performance since 2008.
The 10-year Treasury yield rose 13 basis points last week to 3.88%, after rising 27 basis points the previous week. The 10-year yield ended 2021 at 1.51%.
U.S. crude oil futures rose 0.9% last week to $80.26 a barrel, the third straight weekly gain. Crude oil prices rose 6.7% for the year, but ended their peak above $130 a barrel.
Among rising ETFs, the iShares Expanded Tech-Software Sector ETF ( IGV ) fell 0.3%. VanEck Vectors Semiconductor ETF ( SMH ) rose 1%.
Reflecting more speculative story stocks, the ARK Innovation ETF ( ARKK ) rose 0.9% last week, but after hitting a new five-year low on Wednesday. ARK Genomics ETF ( ARKG ) fell 0.7%. TSLA stock is a core holding among Ark Invest’s ETFs. Cathie Wood’s Ark also has a small position in BYD stock.
The SPDR S&P Metals & Mining ETF ( XME ) fell 1.9% last week. The Global X US Infrastructure Development ETF ( PAVE ) lost 1.2%. The US Global Jets ETF ( JETS ) fell 0.9%. The SPDR S&P Homebuilders ETF ( XHB ) fell 0.8%. The Energy Select SPDR ETF (XLE) rose 0.5%, while the Financial Select SPDR ETF (XLF) rose 0.7%. The Healthcare Select Sector SPDR Fund ( XLV ) fell 0.2%.
Five Best China Stocks to Watch Now
Stock Market 2023: 5 Stocks to Watch
BioMar shares fell 0.8% to 103.49 last week, pulling back in the second half of December but holding support around its 21-day line. A strong rally from current levels may suggest an aggressive entry. But investors may want to wait for BMRN stock to make a new base or find support at the 10-week line. BioMar’s earnings are expected to triple in 2023.
Shares of Deere retreated to its 10-week moving average at 428.76, down 1.9% last week, now with a flat base on the weekly chart. The official buy point is 448.50. Investors can use the 10-week line bounce as an early entry for DE stock, perhaps after retracing the 21-day line.
CELH shares retreated from record highs in December, slipped over the past four weeks, but rebounded from their 50-day line on Friday to close at 104.04. If the Celsius stock clears the 21-day line decisively, it could offer an early entry with a move above the December 27 high of 109.31 as a special trigger.
XOM shares rose 1.5% last week to 110.30, just above the 50-day moving average. A move above the December 27 high of 110.47 would suggest an early entry. Exxon shares have a flat base with a buy point of 114.76, according to MarketSmith analysis.
MEDP shares rose modestly above their 50-day moving average on Thursday, breaking above a bearish trendline in recent consolidation. It offered early access within the consolidation. On Friday, Medpace shares fell back to their 50-day low, but closed well, as major indexes pulled back again.
Medpace’s move could still work, but it shows how difficult it is for the stock to move forward.
Stock market analysis
The stock market closed out a rough year last week, even with Thursday’s strong bounce.
Major indexes are off October market lows but well below December’s short-term highs. As the 2023 stock market begins, the rally attempt is technically underway, but it needs a follow-up day to confirm a new uptrend.
Even then, the market would face a number of technical hurdles with the S&P 500, Nasdaq and Russell 2000 just below their 50-day and 200-day lines. The Dow Jones, the relative leader of recent months, is above the 200-day level, although it has fallen below the 50-day line until the end of 2022.
Until the Fed’s endgame and clarity on the economy, the market may be in a volatile, sideways movement.
On Friday, January 6, the December business report will be important. A marked slowdown in hiring and wage growth will bolster expectations of a further slowdown in Fed interest rate hikes and raise hopes that peak rates are just around the corner. But strong or accelerating job and wage growth will likely trigger a big selloff.
Market Timing with IBD’s ETF Market Strategy
What to do now
It’s a “stay away” market in 2022, O’Neil Global Advisors portfolio manager Charles Harris said on Friday’s year-end IBD Live. There will be great opportunities ahead, including innovative companies and trends, but not yet.
A number of stocks are building nicely, including Deere, BioMarin and Medpace. The problem is that there have been a lot of stock setups over the past few months, but these setups have generally not panned out.
But investors must be engaged and ready to act. If there is a confirmed rally in early 2023, many stocks have the potential to quickly rally solidly or sharply.
So work on your watch lists, but enjoy the long weekend. Come back fresh in the new year in anticipation of the next bull market.
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.
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